The Daily Record

Medicare Drug Plan Divides Seniors As Monday Enrollment Deadline Nears

Seniors, counselors coping with confusion amid the controversy

Daily Record — Sunday, May 14, 2006


As Monday's deadline looms for senior citizens to enroll for Medicare Part D, passions still are running high about the new prescription drug plans. They please some, enrage others.

Eleanor Moravec of Rockaway Township is one who loves the program, even though it has exhausted her. She is a volunteer counselor with the State Health Insurance Assistance Program, or SHIP, which means she has helped lots of seniors, one on one, at various sites in Morris County to narrow down which programs are best for them.

"I have some burnout right now," she said. "It's been a lot of work. I'm happy I was able to do it but I'm ready for the deadline. We're all going to hang in there and help as many people as we can get signed up for May 15."

People like her, who signed up early, already are reaping cost savings, she says. Her Boniva prescription, for example, retails for $98.60. Her Medicare Part D carrier negotiated a price of $64, which she paid until she reached her $250 deductible. Last Tuesday, for the first time, she paid $17.99.

Many seniors on no drugs, or just one, have signed up with the Humana Standard Plan, which costs $4.43 a month, only to avoid paying a late enrollment penalty fee, which could be hefty. Those who do not enroll by Monday – and do not have creditable coverage, as determined by Medicare – face a penalty of 1 percent per month for every month they wait to join.

The penalty stays with them for the rest of their lives.

Rudy Fernandez, who sold his Boonton home and moved to a Parsippany apartment this month to cut his living expenses – which include drug costs – decided to sign up with Humana. But that is not because he went to a SHIP counselor and studied his options. He did not go online, either. Instead he heard from a friend that some third party was happy with the company.

"I signed up earlier this month in the mail," said the 75-year-old Fernandez. "I sent my check in and the form and now I'm just sitting here waiting for the mail to come through before the 15th. At least I'm in the ball game."

But not all seniors are.

873,000 covered

There are 1.2 million Medicare beneficiaries in New Jersey. To date, 873,000 of them have enrolled in Medicare D coverage or are otherwise covered for drugs through Medicare Advantage plans or private or federal retiree benefit plans, according to the Centers for Medicare & Medicaid Services.

Nationwide, there are 42 million Medicare beneficiaries, and 37 million have enrolled in Medicare D or are otherwise covered.

Statistics show that some 327,000 eligible Medicare beneficiaries in the Garden State – 5 million nationwide – have yet to enroll. Why haven't they? Some say the answer lies in the complexity of the plans.

Throughout the nation, seniors are choosing from among more than 1,300 private plans, said Mike Olender, health care organizer of New Jersey Citizen Action, a watchdog coalition. In New Jersey, there are 44 plans from which to choose. New Jersey Citizen Action has been holding events statewide and is calling for an extension of the Monday deadline, contending that it is unfair.

"The Government Accountability Office released a study that concluded many people who man the Medicare hotline were not correct or complete in answering people's questions about Part D," Olender said.

A GAO report released this month – entitled "Communications to Beneficiaries on the Prescription Drug Benefit Could Be Improved" – states that one-third of callers to the Medicare helpline did not receive accurate, complete information. Further, the study found that those who tried to use the Medicare Web site gave it low scores for user-friendliness.

Given both findings, New Jersey Citizen Action says nothing can justify penalizing seniors for the rest of their lives because they are still too confused to file at all.

"It's unnecessary and mean," Olender said. "Why hit them with that?"

U.S. Sens. Frank Lautenberg and Robert Menendez, both D-N.J., also have called for an extension of the deadline.

Rep. Rodney P. Frelinghuysen, R-Harding, said part of the complexity of Medicare Part D is about market competition. When 44 private plans compete for consumers' dollars, as they are in New Jersey, things get complex. In itself, though, that competition has yielded savings.

"The average monthly premium in New Jersey is $25,"Frelinghuysen said. "Initially, people thought it might be as high as $37. The premiums have come down because there's real competition in the marketplace. You talk to the seniors here and they'll tell you the competition was initially confusing because they had to 'sort it out.' A lot of people have been sorting it out and doing pretty well with the plans they're choosing."

For a typical American senior who previously did not have coverage, the average savings is $1,100 a year, according to U.S. Health and Human Services Department estimates.

Unfair to the poor

But New Jersey Citizen Action has another reason for wanting Monday's deadline extended. The group claims that the deadline is unfair to the poorest of the poor seniors – namely, the dual-eligibles, who are very low-income seniors or disabled people enrolled in both Medicare and Medicaid. They number some 140,000 in New Jersey, according to state figures.

New Jersey Citizen Action points to findings of a national Families USA study released on Tuesday. Families USA, a health care advocacy organization, reports that in 25 states and Washington, D.C., four out of five of these low-income seniors eligible for special subsidies under Medicare Part D are not receiving them.

That is not news in New Jersey, where very low-income seniors -- some previously covered under Medicaid – were turned away from their pharmacies as far back as January because of myriad processing problems with their new Medicare Part D coverage. The state stepped in to pay for medications for this population, which lives at or below the poverty line, covering 40,000 prescriptions a day at a daily cost of some $1.3 million.

The problem generated talks between Gov. Jon S. Corzine and Michael Leavitt, secretary of the U.S. Department of Health and Human Services, to work out a reimbursement plan for New Jersey.

"New Jersey cannot afford to continue at this pace," Corzine wrote to Leavitt in January.

If any part of the population is experiencing difficulty, New Jersey Citizen Action contends, the deadline should be extended. The Bush administration has said in media reports that an extension would be unfair to those who already have enrolled in a Medicare Part D plan.

Top Top | NJCA Homepage | NJCA in the News