Update : Medi-Cal Medicare Part D Prescription Drug Program
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1 Santa Clara County Social Services Agency page 1 Date: 10/06/05 References: ACWDL # Cross-References: Clerical: Handbook Revision: N/A Yes Yes Medicare Part D Prescription Drug Program Background Medicare Part D is a new prescription drug coverage program for Medicare beneficiaries. Beginning January 1, 2006, Medi-care Part D will replace most Medi-Cal prescription drug coverage for individuals who are dually eligible (have both Medi-Cal and Medicare including SSI/SSP individuals) and those who are in a Medicare Savings Program (MSP) such as the Qualified Medicare Beneficiary (QMB), Specified Low-Income Medicare Beneficiary (SLMB) and the Qualifying Individual (QI-1) Programs. Anyone who is eligible for Medicare Part A and/or Part B is eligible for Part D. Policy Enrollment into Medicare Part D is mandatory for the following populations: Dually eligible individuals (have both Medi-Cal and Medicare) MSP-only individuals, and SSI/SSP individuals. To facilitate this requirement, the Department of Health Services (DHS) will automatically enroll all individuals listed above into a Prescription Drug Plan (PDP). Individuals can also enroll themselves directly into the PDP of their choice. Prescription Drug Plans As of October 2005, eighteen PDPs have been approved to operate in California. The initial enrollment period is between November 2005 through May Medicare beneficiaries who choose not to enroll when they first become eligible may have to pay a higher premium if they later decide to enroll in a plan. They will also need to wait until the annual general enrollment period (November 15 through December 31 of each year) to sign up for a plan. Each plan has its own distinct list of covered drugs called a formulary. For this reason, it is important that
2 page 2 Medicare beneficiaries select their PDP to ensure that their current prescriptions are covered. Each plan can design their benefit package and has the flexibility to offer supplemental benefits for a higher premium. Full-scope dual eligible and MSP individuals who do not select a plan will be automatically enrolled into a Prescription Drug Plan (PDP). Individuals with Medicare HMOs (e.g. Kaiser Senior Advantage, Secure Horizons, Health Net, etc.) will receive their prescription coverage through their respective plans. Individuals with traditional fee-for-service Medicare will be randomly assigned to a Prescription Drug Plan (PDP) if a plan is not selected. The PDP will notify them by mail once they are enrolled. Dual eligibles and MSPs may change plans at any time after the auto-enrollment if they are dissatisfied with the plan assigned to them. If enrolled... Between November 15, 2005 through December 31, 2005 Between January 1, 2006 and May 15, 2006 and on Effective Begin Date of Coverage January 1, 2006 The first day of the month after the month of enrollment. NOTE: After May 15, 2006, the annual general enrollment period will be from November 15 through December 31 of each year. Medicare Beneficiaries with Other Health Coverage (OHC) Persons who have OHC (through employers, retirement plans or unions) that covers prescription drugs can decide whether to continue their existing drug coverage or enroll in a Medicare PDP. Their OHC insurance companies will notify them prior to January 1, 2006 whether their current drug coverage is at least as good as Medicare PDP coverage. Covered individuals can also contact their OHC carriers to get the needed drug comparison. As long as the current OHC plan is at least as good as what is offered by Medicare PDP, he or she will not be subject to the penalty of a higher premium if s/he decides to join the Medicare PDP later. Otherwise, they need to enroll in a Medicare PDP when first eligible to avoid paying a higher premium later on (after the initial enrollment period). Costs The new Part D has a premium of around $37, annual deductible of $250 and copays/coinsurances. [Refer to Costs, page 16-69]. Low Income Subsidy (LIS) Extra Help The LIS provides assistance for the costs of premiums, deductibles and copays. Persons with limited income (below 150% FPL) and resources (single - less than $11,500; couple - $23,000) can get help in paying the costs by applying for the LIS assistance.
3 page 3 Dually eligible full -scope Medi-Cal eligibles (have both Medicare and Medi-Cal including those on SSI/SSP) and those who are MSP eligibles do not need to apply for the subsidy as they automatically qualify and will be approved for LIS assistance. Once approved for LIS, they do not have to pay premiums or deductibles and will have low copays between $1-$5 for prescriptions up to $5,100. There is no copay for prescriptions over $5,100. For institutionalized (in LTC) individuals, there is no copay at all. [Refer to Low Income Subsidy (LIS) Assistance, page 16-69] for chart illustrations. Individuals who do not automatically qualify for LIS must apply. Dually eligible beneficiaries with a SOC are eligible for LIS beginning in the first month they meet their SOC. Once approved, LIS eligibility continues through the end of the calendar year. It is not contingent on maintaining eligibility and is not subject to change if there are changes in their income or asset levels. Responsible Agency The Department of Health Services (DHS) or Social Security Administration (SSA) are responsible for the LIS eligibility determination, redeterminations and appeals of denials. Information Referral/ Resources To ensure that clients are referred to the appropriate agency, the following chart is provided: Name Area of Expertise Phone Number/ Website Center for Medicaid Services (CMS) Part D enrollment/questions (800) MEDICARE Social Security Administration LIS Applications (800) or local Social Security office Health Insurance and Client Advocacy Program (HICAP) Help/guidance on PDP selection (800) Important Dates The chart below summarizes the different mailings, outreach efforts and deadlines relating to the Part D Prescription Drug Program. DATE May August 2005 DESCRIPTION SSA sent out informing letters to those who have limited income/resources and who may potentially qualify for LIS (including those who automatically qualify for LIS). July 1, 2005 SSA began accepting LIS applications by telephone (800)
4 page 4 DATE October 2005 DESCRIPTION CMS will mail out the Medicare and You handbook to all Medicare beneficiaries with drug plan information. Prescription Drug Plan (PDP) information will be available on and will be helpful for Medicare beneficiaries to compare different plans. November 15, 2005 Full-scope dual eligibles who have not selected their plan will be auto-enrolled into a PDP. After that date, they may change their PDP to better suit their needs. Medicare beneficiaries may start enrolling themselves in a PDP. December 2005 January 1, 2006 May 15, 2006 DHS will systematically send a 10-day NOA to discontinue drug benefits to all dually eligible and MSP only individuals. There are no appeal rights because this is an overall change in Federal law. Medi-Cal will no longer provide prescription coverage for dually and MSP only eligibles. The new Part D Prescription Drug Program begins. MSP only eligibles who have not selected their plans will be auto-enrolled in a plan and coverage begins June 1, Implementation The following are effective immediately upon receipt of this Update unless noted otherwise. Intake Offices Effective Immediately Intake offices must ensure availability of pre-assembled packets in their respective lobbies to be handed out or sent by mail to those who want an LIS application. Each packet must include the following: LIS Cover Page A Medi-Cal mail-in application QMB/SLMB/QI-1 application, and LIS application. Effective 12/01/05 All Medi-Cal adult or QMB/SLMB/QI-1 intake packets must include an LIS application. Note: LIS applications are not required on Continuing RD packets. All Offices If an individual completes and provides an LIS application (in person or by mail) regardless whether or not the individual submits a Medi-Cal or MSP application, all completed LIS applications must be forwarded to SSA by batch using the self-addressed envelope included with each LIS application.
5 page 5 Each District Office must determine a process for designating a basket for batching purposes. A photocopy of an LIS application is not acceptable. Only original LIS application form must be used. If an individual insists upon an LIS eligibility determination by the State or refuses to have his/her LIS application forwarded to SSA, it must be forwarded in batch to: DHS/MEB Attn. MMA Analyst 1501 Capitol Avenue, MS 4607 Post Office Box Sacramento, CA Eligibility Staff Individuals who want to apply for LIS are to be provided assistance. Assistance means (as needed) reading and explaining the LIS application, helping the client in completing the original hard copy LIS application or internet-based application, providing SSA s telephone number (800) where applications can be completed by phone. Refer Medicare beneficiaries to the appropriate agency (refer to the chart above). EW Supervisors Eligibility Supervisors must review this Update with their units at their next unit meeting but no later than October 21, Process Flow In alignment with the current NBM process, the chart below provides the process flow. Stage Who Task/Steps 1 Client Requests an LIS application by walking into an intake office or by phone. 2 CST/OS2 Gives or mails an LIS packet to the client Asks the client if s/he also wants to apply for Medi-Cal or QMB/SLMB/QI-1 Programs. If the client does not want to apply for Medi-Cal... If the client wants to apply for Medi-Cal... No further action is required. Proceed with the New Business Model (NBM) process 1.0 (Reception) and 2.0 (Registration). If the client prefers mail-in application, NBM process 3.6 (Medi-Cal Phone/Mail-In Application) applies. Note: If the client needs assistance in completing the LIS application, refer the individual to the office-designated staff who handles Part D/LIS inquiries.
6 page 6 CalWIN System Copays, coinsurances and deductibles can be used as out-of-pocket medical expenses to reduce the SOC and are entered in the [Collect Medical Expense Detail] window. The Medicare Part D premium is an other health coverage income deduction and is entered in the [Collect Health Care Coverage Detail] window. Since Part D is not subject to a state buy-in, no entries are required in the [Collect Medicare Expense Detail] or [Collect Individual Benefit Detail] windows. Forms LIS Applications An initial supply of LIS applications (including pre-addressed, postage-paid return envelope) has been sent to all District Offices during the week of September 30, LIS applications come with a pre-addressed, postage-paid return envelope. Photocopies of LIS applications are not acceptable. Only original LIS application must be used. Hard copy LIS applications are only available in English and Spanish. All other languages are available from the SSA website at and must be completed and submitted to SSA online. Posters Posters relating to the new Prescription Drug Plan have been sent to all District Offices during the week of September 30, LIS Packet Cover Page An initial supply of the English and Spanish LIS cover page entitled We Can Help You Pay Your Medical Expenses and Medicare Costs have been sent to intake offices during the week of September 30, Other Programs This Update only affects the Medi-Cal Program. Clerical See Implementation and Forms above. KATHERINE BUCKOVETZ, DIRECTOR Department of Employment and Benefit Services Contact Person(s): Janette Anastacio, Medi-Cal Program Coordinator, (408)
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