Print - Part D - LIS Bene Notices

CMA Weekly Alert
September 4, 2008

IT'S TIME FOR THOSE PART D "EXTRA HELP" NOTICES:
WHAT LOW-INCOME MEDICARE BENEFICIARIES SHOULD EXPECT AND DO

Each fall, the Social Security Administration (SSA) and the Centers for Medicare & Medicaid Services (CMS) notify certain individuals, who are receiving "Extra Help" (also called the Low-Income Subsidy or LIS) paying for their Part D drugs, of their status with respect to that benefit for the following year as well as their status with respect to their Part D plan.

Five categories of Extra Help recipients will get notices related to their status between now and the end of 2008:

Those for whom SSA has undertaken a redetermination of eligibility based on their having applied for, and been awarded, Extra Help through SSA
Those who were "deemed" eligible for Extra Help because they receive another benefit but who have lost their "deemed" status
Those whose co-payment will change in January 2009
those who have chosen a Part D plan that will no longer be a "benchmark", plan starting in January 2009 (benchmark plans have been designated by Medicare to meet certain coverage requirements and have a monthly premium amount that is fully subsidized by Extra Help)
Those who were assigned to a Part D plan that is leaving Part D or will no longer be a benchmark plan in January 2009

SSA Redeterminations

This year, according to SSA, about 253,000 beneficiaries will get notices called "SSA Review of Your Eligibility for Extra Help," which people should have started receiving as early as Tuesday, September 2. SSA is required by law to undertake a redetermination of eligibility within a year of an individual's first receipt of Extra Help, and periodically after that time.

The cover letter, which together with the redetermination form is available at http://www.ssa.gov/prescriptionhelp/SSA-1026B-OCR-SM-INST.pdf, informs recipients that they must return the form (in the included postage pre-paid envelope) within 30 days or they will lose their Extra Help beginning January 1, 2009. It also directs them to call Social Security, if they have questions, at 1-800-772-1213. SSA will begin mailing Redetermination Decisions letters in November.

Individuals whose Extra Help is reduced or terminated have the right to appeal, including a right, enacted into law in 2008 but retroactive to 2003, to take their appeal to Federal Court. According to SSA, only 14% of those whose eligibility was redetermined last year were terminated from the program, about 20% of those individuals appealed and 88% of those who appealed where found eligible through the appeal. Thus, it is important for beneficiaries to return the forms on time and it is valuable to appeal if found ineligible

Loss of Deemed Status

In mid-September, CMS will mail a GREY "Loss of Deemed Status" letter to those individuals who will lose Extra Help in January because they no longer qualify for the program through which their Extra Help eligibility was deemed. Those programs are Medicaid; the Medicare Savings Programs called Qualified Medicare Beneficiary (QMB), Specified Low-Income Medicare Beneficiary (SLMB) and Qualified Individual (QI); and Supplemental Security Income (SSI). Because eligibility rules for Extra Help are, in many instances, more generous than those of the programs through which individuals can be deemed eligible, these letters will include an application for Extra Help to be submitted to SSA. Individuals receiving this letter and the application should complete the application unless they are certain that they have re-qualified for the program through which they were deemed.

Change in Extra Help Co-payment

Because Extra Help co-payments increase every year, except for individuals residing in institutions, nearly all Extra Help recipients should receive this ORANGE letter from CMS to be mailed in early October. Recipients of this letter should keep it for their records; unless they dispute its contents and wish to appeal, they need take no action.

People who Chose Non-benchmark Plans

In late October or early November, CMS will mail a TAN letter to those recipients of Extra Help who chose their own plan for 2008 and whose plan will not be a benchmark plan in 2009. Recipients are advised that they might want to review plan choices and chose a different plan that will be a benchmark plan in 2009. A list of 2009 benchmark plans is included with the letter. If they do not choose a benchmark plan, they will be liable for, and pay out-of-pocket, a portion of their plan's premium.

Reassignment of Those Auto-enrolled in Benchmark Plans

Also in late October or early November, CMS will mail BLUE letters to 1.3 million beneficiaries receiving Extra Help - about one in seven of all such recipients - whose plan is either leaving the Medicare program or charging a premium above the benchmark. These letters will inform beneficiaries that they will be reassigned to new benchmark plans if they do not choose their own plan by December 31, 2008. Beneficiaries choosing their own plan can sign up for a plan until December 31 and its effective date will be January 1.

The later people sign up in the enrollment period, however, the more likely they are to experience delays in getting plan documents and having their enrollment appear in the relevant databases that will allow them to get drugs with their subsidy. While plans are required to reimburse enrollees for any costs they incur that should have been borne by the plan, such reimbursements can be difficult and time consuming to secure. It is wise, therefore, to enroll in a plan as early as possible; open enrollment begins November 15, 2008.

CMS's reassignment process does not take into account an individual's prescription drug usage, the formulary of the new plan or the utilization management tools used by the new plan. Individuals who are reassigned are advised to look at the plan to which they have been assigned to see if it meets their needs and to compare it to other plans available in their area. Plan information is available at www.medicare.gov in early to mid-October.

Beneficiaries needing assistance in deciphering any of these notices should contact their local State Health Insurance Assistance Program whose location can be found at www.shiptalk.org or http://www.hapnetwork.org/ship-locator.

For CMS's Guide to LIS Mailings from CMS, Social Security and Plans - Summer and Fall 2008, go to http://www.cms.gov/LimitedIncomeandResources/Downloads/2008Mailings.pdf