Public Employee Press

Retirees may change Medicare drug plan Nov.15-Dec. 31

From Nov. 15 to Dec. 31, retirees covered by the Medicare prescription drug plan can choose a new provider.

But DC 37 urges retirees to use the enrollment period to “come home” to the union’s plan and avoid paying unnecessary premiums and deductibles for Medicare Part D coverage, unless they are covered by a Medicare Advantage health plan that includes a mandatory drug benefit.

“Our benefit is as good as or better than what the private providers of the Medicare drug benefit are marketing,” said Cynthia Chin-Marshall, acting administrator of the DC 37 Health and Security Plan. “Generally, our out-of-pocket expenses are lower and our coverage is more comprehensive.”

For retirees who enroll in a Medicare drug plan, the DC 37 prescription drug benefit becomes their secondary provider. That means the DC 37 Health and Security Plan picks up their drug coverage when they hit Part D’s infamous coverage gap and would have to pay the full cost of their drugs. This gap, or “donut hole,” left drug costs from $2,400 to $3,850 uncovered in 2007. It will rise to $2,510 to $4,050 in 2008. Catastrophic coverage kicks in once participants reach the high end of the gap.

The transition to DC 37 coverage for retirees who reach the gap occurs smoothly for the more than 6,000 individuals enrolled in the HIP VIP Medicare Advantage plan, which requires participants to use its drug benefit. Because of its longstanding relationship with HIP, the DC 37 Health and Security Plan was able to set up an automatic notification procedure, enabling the plan to reinstate coverage.

The coverage gap is a potential problem for retirees in other Medicare Advantage plans or drug plans who may be unaware that they must contact DC 37 to activate their union coverage.

Plan officials also warn retirees to be very wary when they receive marketing material from Medicare Part D providers and to contact the union plan’s Inquiry Unit (212-815-1234) before deciding to switch.

Medicare Part D plans have annual deductibles and monthly premiums and generally have higher co-pays. The DC 37 plan has no deductible or monthly premium; it has an annual limit of $100,000.

In some instances, DC 37 retirees might be better off in Medicare Part D programs for people whose income is below the poverty line, which in 2006 was $10,294 for an individual and $13,167 for a family of two. The plans for people with incomes below the poverty line don’t have deductibles and co-pays.