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PEP Nov. 2006
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Public Employee Press

Retirees may switch drug and health plans in November

Union plan plugs the Medicare donut hole

Many retirees are being inundated with information about Medicare Part D plans because November is the open enrollment period for the one-year-old government-funded drug benefit.

This November is also a “reopener” period when retirees are allowed to switch their city health care plan.

Last year, when the federal government launched the Medicare Part D drug benefit, thousands of DC 37 retirees opted for plans offered by insurance companies or were automatically covered for medications by their Medicare Advantage plan, such as HIP VIP.

Deciding to tap into the massive federal funding for the new benefit, many Medicare Advantage plans added prescription drugs to their overall coverage. That made employer or union plans, like DC 37’s prescription benefit, secondary for retirees in Medicare Advantage health plans.

Retirees who are happy with their current plans should probably sit tight.

The DC 37 Health and Security Plan urges anyone contemplating a change to call its Health Insurance and Pension Unit at 212-815-1200.

Generally, the DC 37 benefit offers a better deal, with lower co-pays, more comprehensive coverage (see accompanying box), and no deductible, while Part D has a $265 deductible for 2007.

And Medicare Part D has the infamous “donut hole,” the annual gap in coverage where participants must pay 100 percent of the cost of their prescriptions. In 2007, the gap affects expenditures from $2,400 to $5,451.

When retirees in Medicare D hit the gap or their plan’s annual maximum, the DC 37 prescription drug benefit will cover them, but only if they contact the union. Last year, DC 37 worked with HIP to ensure that retirees affected by the annual maximum were automatically enrolled in the union benefit. But union officials fear many retirees in other Medicare Advantage or independent plans may go without gap coverage if they are unaware that they must contact DC 37 to be reinstated in the union benefit
plan.

Changes in enrollment in the city’s health plans and Medicare Part D plans are effective Jan. 1, 2007.
Information about the health plans offered by the city is available at “Health Benefits Program” on the Web page of the Office of Labor Relations, which can be accessed by going to www.nyc.gov and clicking “Labor Relations” in the list of agencies.

Retirees may also find out about the city’s health plans by visiting or calling the Health Benefits Program, which is on the third floor at 40 Rector St. in Manhattan. The phone number is 212- 513-0470.

— Gregory N. Heires

Prescription drug plan comparison
 DC 37 Health
and Security Plan
Medicare Part D (2007)
RetireeSpouse
Who’s covered?Member, spouse and eligible dependentsMedicare eligible retiree onlyMedicare eligible spouse only
Monthly premium$0$30 to $35$30 to $50
Annual deductible$0$265 for retiree$265 for spouse
Prescription drug costs between $1 and $265$ 5 generics
$15 preferred
$35 non-preferred
No coverage. Retiree pays full
cost until $265 deductible is met.
No coverage.
Spouse pays full cost until $265 deductible is met.
Prescription drug costs between $265 and $2,400Same co-pays as aboveRetiree pays 25%
of cost, Medicare pays 75%
Spouse pays 25%
of cost, Medicare pays 75%
Prescription drug costs between $2,400 and $5,451Same co-pays as aboveNo coverage (gap)No coverage (gap)
Prescription drug costs over $5,451Same co-pays as above up to $100,000 annual limitRetiree pays 5%
of cost, Medicare pays 95%
Spouse pays 5%
of cost, Medicare pays 95%

 

 

 

 
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