Public Employee Press

Call union before signing up for Medicare Part D

Retirees have until Dec. 31 to sign up for coverage by a Medicare drug plan in 2007.

But anyone who is considering enrolling in a Medicare Part D plan, including city employees who expect to retire by the end of the year, should contact the DC 37 Health and Security Plan before making a decision. Call the plan’s Inquiry Unit at 212-815-1234 if you have questions.

The open enrollment period for Medicare Part D plans is from Nov. 15 to Dec. 31.

In November, the DC 37 Health and Security Plan sent out a notice to members and retirees about Medicare and the union’s prescription drug benefit.

By law, employer and union health plans with drug benefits are required to inform their participants that the coverage they provide is at least as good or better than the Part D benefit. The notification is known as a “letter of creditable coverage.”

Retirees and members close to retiring should keep the DC 37 Health and Security’s “letter of creditable coverage” on file at home in order to avoid a possible penalty for not signing up for a Medicare Part D plan.

Under the rules for Medicare Part D, anyone who enrolls in a Medicare Advantage or independent drug plan after allowing for a gap in coverage for 63 days is subject to a 1 percent per month penalty on their monthly premium for each month that they went without coverage. The DC 37 letter provides proof of coverage by the union plan.

One of the drawbacks of Medicare Part D is the infamous “donut hole,” the annual gap in coverage where participants must pay 100 percent of the cost of their medications. In 2007, the gap affects expenditures from $2,400 to $5,451. When retirees covered by Medicare D hit the gap, the DC 37 prescription drug benefit will cover them, but only if they contact the union.

In October, Congressional Democrats charged that a government publication sent to Medicare beneficiaries was biased in favor of the private insurance plans that offer the government health benefit.

When the law creating the Part D program was established in 2003, critics charged that it was a Trojan horse for privatization of the government program. The law favors private companies, for instance, by providing subsidies to plans that offer the prescription drug benefit.

“The 2007 handbook strongly favors health-maintenance organizations, preferred provider organizations and other private Medicare Advantage plans over the traditional Medicare fee-for-service program,” the Democrats wrote in a letter to Michael O. Leavitt, the secretary of health and human services, in October.