On January 1, 2006 Medicare began to offer coverage for prescription drugs to people who qualify for Medicare. Medicare prescription drug coverage is insurance that covers both brand-name and generic prescription drugs at participating pharmacies in your area. Everyone with Medicare is eligible for this coverage, regardless of income and resources, health status, or current prescription expenses.

Coverage is offered through private prescription drug plans, sometimes referred to as Medicare Part D. To receive this coverage, people on Medicare must enroll in a plan no later than May 15, 2006. If a person has creditable coverage (coverage deemed as good as or better than Medicare Part D), they do not have to apply for Medicare drug coverage. Beneficiaries without creditable coverage and who fail to enroll by May 15, 2006 will incur a lifetime penalty in the form of higher premiums if they choose to enroll at a later date.

Your decision about Medicare prescription drug coverage depends on the kind of health care coverage you have now. There are two ways to get Medicare prescription drug coverage. You can join a Medicare prescription drug plan or you can join a Medicare Advantage Plan or other Medicare Health Plans that offer drug coverage.

Like other insurance, if you join, you will pay a monthly premium which varies by plan (averaging $32 per month in FSR's home state of Illinois) and a yearly deductible (no more than $250 in 2006). You will also pay a part of the cost of your prescriptions, including a co-payment or coinsurance. Costs will vary depending on which drug plan you choose. Some plans may offer more coverage and additional drugs for a higher monthly premium.

If you have limited income and resources, and you qualify for extra help, you may not have to pay a premium or deductible. This extra help is available through application to the Social Security Administration. The extra help may also be referred to as the low-income subsidy (LIS). The LIS will reduce or eliminate monthly premiums, deductibles, and co-insurance payments. Some groups automatically qualify and are not required to apply. Those automatically eligible include people with Medicare and Medicaid (dual-eligibles), people who receive SSI and people who are enrolled in some state medical savings programs.

If the beneficiary is currently enrolled in Medicaid and also qualifies for Medicare, they will receive their prescription drug benefits through Medicare in calendar year 2006 and beyond. Medicaid will continue to cover the person’s other health care needs.

Medicare beneficiaries should examine what drugs are available in each Medicare prescription drug plan prior to enrolling. Assistance in choosing a plan that best meets their needs is available at many locations in local communities. A person can also call state agency assistance hotlines to receive more information about where to receive assistance with enrollment.

State Health Insurance Assistance Program (SHIP)
The State Health Insurance Assistance Program (SHIP) has counselors in every State and several Territories that are available to provide free one-on-one help with your Medicare questions or problems. A list of contacts by state is available on the Medicare Web site at: http://www.medicare.gov/contacts/static/allStateContacts.asp.

Social Security Administration
There is extra help for people with limited income and resources. Almost 1 in 3 people with Medicare will qualify for extra help and Medicare will pay for almost all of their prescription drug costs. You can apply or get more information about the extra help by calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778) or visiting www.socialsecurity.gov.