Medicare drug plans grow

Marylanders' choices expand to 56 for 2nd sign-up beginning Nov. 15

September 30, 2006|By M. William Salganik | M. William Salganik,Sun reporter

The second sign-up period for Medicare prescription coverage is approaching - and there are even more choices this time.

Marylanders will have 56 plans to choose from for next year, up from 47 this year, according to information released yesterday by the federal Centers for Medicare and Medicaid Services. Each plan has a different monthly premium, different deductibles and co-payments and a different list of participating pharmacies, and each can set its own list of medications that it will cover.

The prelude to the Jan. 1 launch of the prescription program - the biggest new entitlement since Medicare was created in 1965 - was beset by complaints about the complexity of sifting through what some saw as a bewildering array of options. Many people were unsure if they needed to sign up - those who already had equivalent coverage didn't need to - and worried about a penalty in future premiums if they missed the deadline.

During the first weeks, there were reports of seniors being overcharged or not getting coverage at all because of computer foul-ups.

Maryland's choice of 56 plans was fairly typical. Almost all states will have between 50 and 60 as new insurers enter the program and some regional plans expand to more states, according to an analysis by Avalere Health, a Washington consulting firm.

Federal officials and an insurance trade group said the increased number of plans for next year represented an improvement in the program.

"As a result of robust competition and smart choices by seniors, plans are adding drugs, removing options that were not popular and providing more options with enhanced coverage," said Dr. Mark McClellan, administrator of the Medicare and Medicaid centers.

"Private plans are exceeding expectations by offering low premiums and expanding benefits," said Karen Ignagni, president and CEO of America's Health Insurance Plans, a trade association.

But one critic of the program said the increased number of choices will only add to the complications.

"The incredible confusion that persisted in the past year about the Medicare drug program is about to get worse," predicted Ron Pollack, executive director of Families USA, a consumer group. "There will be more plans to choose from - and those plans will continue to be different from one another. And, instead of a six-month enrollment period, there will only be a 1 1/2 -month period this year."

For next year, enrollees who are satisfied with their current plans do not need to do anything during this year's sign-up period, beginning Nov. 15. Each should receive a letter outlining any changes in premiums, co-payments and covered drugs. Those who want to switch are free to sign up for any other plan. The new coverage begins Jan. 1.

Monthly premiums will go up for some plans, particularly those that were lowest-priced for this year. The lowest-cost plan in Maryland this year, Humana Standard, is doubling its premium, from $6.44 to $13.

But premiums will go down for others. Overall, the median premium (half are higher, half are lower) will be $33.40 for next year, down from $36.01 this year, according to Avalere Health.

More plans will offer some type of coverage in the so-called doughnut hole. Most plans this year had no coverage of drug spending between $2,250 and $5,100. For next year, 13 Maryland plans are offering doughnut hole coverage of generic drugs, and two offer coverage of generics and some brand-name drugs; most of these have premiums between $40 and $50 a month. One has complete doughnut hole coverage, but a monthly premium of $103.20.

Though the enrollment period runs from Nov. 15 to Dec. 31, Medicare officials urged people to sign up by Dec. 8 so the applications can be processed and computers updated for coverage to begin Jan. 1. In addition to those over 65, younger people with disabilities that qualify them for Medicare are eligible.

Yesterday's announcement listed participating insurers and premiums, but didn't have information on co-payments and lists of covered drugs. The Centers for Medicare and Medicaid Services said that information would be available in mid-October.

In all this year, 10.4 million nationally and 183,796 in Maryland enrolled in stand-alone prescription insurance plans. Others chose prescription coverage through Medicare HMOs and other complete health plans.

To see a list of participating Maryland plans and their premiums for next year, go to, click on "Medicare Prescription Drug Plans by State for 2007," then click on Maryland.

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