Prescription Drug Part D

Why Offer Part D?

• 30 million individuals will turn 65 over the next decade
  • By the year 2010, a baby Boomer will age into retirement every 9 to 10 seconds!!
  • People living beyond 85 will double in the next 20 years
• 42.6 million individuals are eligible
  • Most of them receive care through the traditional fee-for-service program
• 4.3 million eligible individuals did not enroll last year
• 51% of pre-beneficiary seniors between 64.5 and 65.5 years old say they will definitely stay with their current insurer when they reach the age for Medicare benefits
• 11% of 36 million enrolled members might switch
• Medicare Part D compliments many of your other product lines!

Prescription Drug Coverage

Medicare Mandated Prescription Drug Coverage

Premiums	Deductible	Coinsurance	Initial Coverage	Coverage Gap	Catastrophic Coverage
The monthly charge to participate in the plan (varies by service area)	The amount member pays before the coverage starts is $275 maximum for 2008 (varies by plan)	The amount the insurance splits with member During the initial coverage period, insurance pays 75% and member pays 25% During the catastrophic coverage period, insurance pays 95% and member pays 5%	The plan coverage starts with the first prescription after the member has paid the deductible When the total drug costs exceed $2,510 the member enters the coverage gap	Period in which member pays 100% of the prescription drug costs Begins when member has reached $2,510 in shared costs and ends when a member has reached $4,050 in true out-of-pocket costs	The period when the insurance covers a member's drug costs almost fully The catastrophic coverage period for 2008 begins once the member pays $4,050 in true out-of-pocket costs during the year (January 1 initiates a new cycle starting with the deductible)

What if I Can't Afford a Prescription Drug Plan?

• People with limited income and resources may qualify for extra help with prescription drug plan expenses. Extra help includes:
  • Lower or no monthly premiums
  • Lower or no copays or coinsurance
  • No coverage gap
• You could qualify for extra help if
  • You are single with an income of less than $15,315 per year
  • You are married, and living with your spouse, with an income of less than $20,535 per year
• You could automatically qualify, and don't need to apply for extra help if:
  • You receive both Medicare and Medicaid (ie., you are dual eligible) benefits and meet certain income requirements, and/or
  • You receive both Medicare and Supplemental Security Income (SSI) benefits and meet certain income requirements

Low Income Subsidy (LIS) Eligibility

Eligibility Requirements	Benefit Summary
Full-benefit "Dual Eligibles" Individuals who are eligible for both Medicare and Medicaid	No monthly premium No deductible Minimal cost sharing No penalty for late enrollment in 2007
Individuals with Incomes below 135% of the Federal Poverty Level (FPL) Assets that do not exceed FPL-defined levels	No monthly premium Deductibles vary by assets Minimal cost sharing
Individuals with Incomes between 135% and 150% of the FPL Assets that do not exceed FPL-defined levels	Sliding scale premiums Lower deductible Reduced cost sharing