Don’t Be Late! Medicare Part D Penalty

Within the alphabet soup that is Medicare, there are important deadlines of which to be Medicare Part D Penaltyaware.  If you are late to enroll you may be forced to pay a Medicare Part D penalty.

Medicare Part D is the prescription drug benefit of Medicare.  Like all of Medicare, there are specific and limited times that you can enroll in the program.  It is important to understand these enrollment periods, so you can avoid late enrollment penalties.

When can you enroll in Medicare Part D?

The Initial Enrollment Periods for Medicare include:

  • You’re newly eligible for Medicare because you turn 65. You get a 7-month period to pick your plans, which starts 3 months before the month you turn 65, includes the month you turn 65, and ends 3 months after the month you turn 65.
  • You’re newly eligible for Medicare because you’re disabled and under 65.
  • You’re already eligible for Medicare because of a disability, and you turn 65.
  • You HAVE Medicare Part A coverage, and you get Medicare Part B for the first time by enrolling during the Part B General Enrollment Period (January 1–March 31).

The Penalty

You may owe a late enrollment penalty if at any time after your Initial Enrollment Period is over, there’s a period of 63 or more days in a row when you don’t have Part D or other creditable prescription drug coverage. Creditable prescription drug coverage is coverage (for example, from an employer or union) that’s expected to pay, on average, at least as much as Medicare’s standard prescription drug coverage.

The late enrollment penalty is an amount that’s added to your Part D premium each month. If you have a penalty, you may have to pay it each month for as long as you have Medicare drug coverage!  The Part D late enrollment penalty is calculated as 1% of the national base beneficiary premium for each full, uncovered month that you didn’t have Part D or creditable coverage.

For example, if there was a period of 14 months that you did not have Part D or creditable prescription drug coverage, this is how the penalty is calculated:

14 months x 1% = .14

.14 x $35.63 (2017 base beneficiary premium) = $4.98

$4.98 rounded to the nearest $.10 = $5

$5.00 would be added to your monthly Part D premium for as long as you have Medicare Part D (which is usually for the rest of your life).  So each year you would be paying an additional $60 in Part D penalties. Over 20 years that would be $1,200 in completely avoidable penalties.

For more information about Medicare, read our Quick Guide to Medicare, or watch our webinar on “Making Sense of the Medicare Maze.”

For more information on the Part D Late Enrollment Penalty, visit  or

Understanding Medicare Part D – Prescription Drug Coverage

Medicare is a government health insurance program for eligible individuals. To be Medicare Part Deligible you must be: 65+ years old; have collected SSDI benefits for more than 24 months; or have been diagnosed with end stage renal disease (ESRD) or ALS. There are currently about 56 million Americans enrolled in Medicare.

Medicare coverage is broken up into “parts:”

  • Part A: Hospital Insurance – includes hospital care, skilled nursing facilities, nursing homes, hospice, and home health services.
  • Part B: Medical Insurance – includes services from doctors, preventive care, outpatient care, lab tests, mental health care, ambulance services, and durable medical equipment.
  • Part D: Prescription Drug Plan (PDP) – different plans to choose from depending on where you live, with different premiums and formularies.
  • Part C: Advantage Plans. Part C is an alternative to Parts A & B and it includes the benefits and services covered under Parts A & B, and usually Part D. You can select a PPO or HMO plan that is run by a Medicare approved private insurance company.

For more information about Medicare, read our Quick Guide to Medicare, or watch our webinar on “Making Sense of the Medicare Maze.”

Medicare Part D is optional, but if you are taking prescription medication and do not have Part D, you may have to pay for medications out-of-pocket. If you decide later that you want Part D, but didn’t sign up when you were first eligible, you pay have to pay a late enrollment penalty.

How much you pay for Medicare Part D and out-of-pocket prescription drug costs depends on a number of factors, like which Part D plan you choose, how many prescriptions you take and how often, whether your pharmacy is in your plan’s network, whether your prescription drugs are on your Medicare Part D plan’s formulary, and more. To find which Medicare Part D plans are available where you live, click here.

Part D premiums generally range from $10-$100 per month (depending on the plans available in your area and on the specific plan you choose). The maximum deductible—the amount you must pay out-of-pocket before Medicare will contribute to your prescription costs—in 2017 is $400. After paying your deductible, then Medicare will pay 75% of your prescription drug costs and you will pay 25%, up to a total of $3,700.

What many refer to as the “donut hole” in Medicare Part D coverage is a gap in coverage when you have spent a certain total amount on covered prescriptions. In 2017, once you and your plan have spent $3,700 on covered drugs, you’re in the coverage gap. This amount may change each year. Also, people with Medicare who get Extra Help paying Part D costs won’t enter the coverage gap. For more information and examples of the coverage gap, visit Medicare.

Even with Part D coverage, prescription drugs can be expensive. Depending on your income level, you may qualify for financial assistance to help pay for your prescriptions drugs. A Low-Income Subsidy provides Medicare beneficiaries with assistance in paying their Part D monthly premium, annual deductible, coinsurance, and copayments. Some people may be eligible for Extra Help, a program aimed for those who do not automatically qualify for a Low-Income Subsidy. You may be entitled to Extra Help if you are entitled to Medicare and get full coverage from a state Medicaid program, you are enrolled in a Medicare Savings Program, or you get SSI disability benefits. The Medicare Savings Program pays for the Medicare Part A and the Medicare Part B premiums. It also pays Medicare cost-sharing expenses, including deductibles, coinsurance, and copayments.

For more information on how to reduce your prescription drug costs, visit the following link. Examples include switching to lower-cost medication if approved by your health care team, or switching to mail-order programs from your plan.

You can also visit to find other financial assistance resources.

For help with Medicare and making plan choices, you can visit or call 1-800-MEDICARE. You can also speak to a local counselor through the State Health Insurance Assistance Program. Click here, then pick your state from the drop down menu on the right, under “Find someone to talk to,” and it will provide the local contact information.

Post Election Update: Changes to Medicare

Established in 1965, Medicare now covers nearly 48 million seniors and an additional 9 Changes to Medicaremillion people with disabilities. For information about Medicare, read our previous blogs or our Quick Guide to Medicare. Congressional leaders have indicated that there are changes to Medicare on the way.

Medicare’s benefits can be accessed in two ways. Through traditional Medicare, services are covered as fee for service.  Meaning that you can get medical care from any provider that accepts Medicare coverage.  Alternatively, Medicare Advantage is a way to get Medicare coverage through a managed care plan (HMO or PPO). These managed care plans are offered by private health insurance companies and have specific networks of providers that are covered by the plan.

Throughout the contentious election season, President-elect Donald Trump, promised to preserve Medicare as is.  However since the election, key Republican leaders have proposed changes to Medicare.

For example, U.S. Congressman Tom Price, a noted conservative who was recently nominated to be the next U.S. Secretary of Health and Human Services (HHS), has proposed, among other changes, moving Medicare to a voucher system. This would mean giving each individual a voucher worth a certain amount of money to go and buy private health insurance coverage.  There are a number of potential challenges with this approach for consumers:

  1. If the ACA is repealed, many of the consumer protections will no longer be available
  2. It is unclear if the amount of the voucher will be enough to actually buy coverage. If it isn’t then individuals will have to pay more for their health insurance than they were paying under Medicare
  3. It is unclear what the individual health insurance market will look like and what plan options will be available
  4. It is unclear if those options will provide equal coverage to Medicare
  5. As seniors and people with disabilities often have higher medical expenses, they may be charged more for their coverage and plans may be too expensive for people to buy

Congressman Price’s nomination to lead HHS, which has control over Medicare, has caused many to question the validity of President-elect Trump’s campaign promise to protect Medicare.

Speaker of the House Paul Ryan has also championed a voucher system, which he calls “premium support.”  In his 2016 proposal entitled “A Better Way,” Ryan makes several recommendations. Under his plan, the Medicare eligibility age would be raised from 65 to 67 by 2020.  Then in 2024, “Medicare beneficiaries would be given a choice of private plans competing alongside the traditional Medicare program on a newly created Medicare Exchange.” Increasing subsidies for Medicare Advantage and allowing private insurers to offer a variety of coverage levels is suggested as well.  Unfortunately, consumers who choose plans with more comprehensive coverage and flexibility may be required to pay the difference.

Some economists say that a privatized Medicare Advantage would be more efficient and enhance benefits to consumers while decreasing the cost to taxpayers.  Other experts say that Medicare would not automatically be more efficient if privatized. They argue that Medicare already efficient and the projected savings privatized Medicare Advantage was supposed to provide have not materialized.

Additionally, both Price’s and Ryan’s proposals leave out important details.  For instance, how much money would be given to individuals to purchase insurance? Would benefits be guaranteed?  How would the quality of coverage be monitored and ensured?  Would subsidies increase in proportion to the rising cost of healthcare?

Exactly what, if any, changes will be implemented is still unclear.  Not every member of Congress who is committed to repealing the Affordable Care Act, also thinks that making changes to Medicare should be their top priority.  Those who do want to make changes to Medicare have different opinions on how to do so.

One thing is certain: these proposed changes have caused considerable anxiety for Medicare recipients and their advocates. Triage Cancer will continue to follow this issue and share information as we receive it. Stay tuned to our blog and newsletter for the latest information.

Important News Regarding Changes to Medicare

medicaredotgovThe new year will bring changes to Medicare.  Click here to see what Medicare will cost in 2017.

Also, if you recently became eligible for Medicare, but thought it would be less expensive to keep your Marketplace coverage because you get financial assistance to pay for your Marketplace coverage, then the rest of this message is for you. 

When you became eligible for Medicare Part A (the hospital portion of Medicare that is usually premium-free), you also became ineligible for Marketplace financial assistance. So that means you will be on the hook for the full price of the Marketplace plan. This also means that you probably missed the open enrollment period for Medicare Part B (the other part of Medicare coverage that has a premium). And, it means that if you do try to get Medicare Part B now, you will pay a late enrollment penalty for the rest of your life.  But . . .

For a limited time, you can apply for “equitable relief” that will give you a Special Enrollment Period to enroll in Part B. It also means that they won’t apply a late enrollment penalty, but you must apply by MARCH 31, 2017!

Some of you in this situation may have been notified of this program by mail. But it you weren’t notified, or lost the notice, or even feel you received misinformation about qualifying for financial assistance, you should contact the Social Security Administration (800-772-1213) to apply for the “equitable relief.”

Your application should include:

  • Any information or documentation you have on how you learned that the financial assistance would not apply and/or why you thought you could continue financial assistance.
  • Any letters (including the notice mentioned above), emails, notes from conversations
  • Or any other relevant information

And more good news – you don’t need to show that your confusion was caused by any particular source to qualify for this relief. You can just be confused.  We know health insurance is confusing!

To learn more about Making Sense of the Medicare Mazewatch our recorded webinar.

Buying Supplemental Insurance Can Be Hard For Younger Medicare Beneficiaries

by, Kasier Health News

Danny Thompson’s kidneys have failed and he needs a transplant but in some ways, he’s lucky: Both of his sons want to give him one of theirs, and his Medicare coverage will take care of most of his expenses.

Yet the 53-year-old Californian is facing another daunting obstacle: He doesn’t have the money for his share of the medical bills and follow-up drugs, and he can’t buy supplemental insurance to help cover his costs.

“It’s frustrating to be in the shape I’m in,” said Thompson, who depends on dialysis instead of his kidneys to cleanse his blood. “My plan is to get a transplant so I can go back to work.”

Almost one in four Medicare beneficiaries has such a policy, known as Medigap, which is sold by private insurance companies. It can help pay for costs Medicare doesn’t cover, including the 20 percent coinsurance required for medical expenses, including certain drugs, plus deductibles and co-payments. Those expenses have no out-of-pocket limit for beneficiaries.

Federal law requires companies to sell Medigap plans to any Medicare beneficiary aged 65 or older within six months of signing up for Part B, which covers doctor visits and other outpatient services. If they sign up during this guaranteed open enrollment, they cannot be charged higher premiums due to their medical conditions.

But Congress left it to states to determine whether Medigap plans are sold to the more than 9 million people younger than 65 years old who qualify for Medicare because of a disability.

In 20 states and the District of Columbia, home to more than 2 million disabled Medicare beneficiaries, insurers are not required to sell Medigap policies to customers under 65. In other states, insurers cannot reject applicants if they enroll when they first join Medicare. Companies in some states, including Virginia, can still charge higher premiums to younger beneficiaries or those with kidney disease, often making policies unaffordable.

In California, Massachusetts and Vermont. insurers are required to sell Medigap policies to anyone with Medicare, except to people like Thompson who are under 65 and have end stage renal disease.

“If it was the reverse — if you were discriminating against somebody because they were 65 or older as opposed to younger — people would be outraged,” said Bonnie Burns, policy specialist for the consumer group California Health Advocates and a member of the National Association of Insurance Commissioners’ Medigap committee.

The federal health law provides no relief for these younger Medicare beneficiaries. One of its most popular provisions prohibits discrimination by insurance companies in the non-Medicare market based on pre-existing conditions or age, but the law is silent on Medigap.

Thompson, who lives in Menlo Park, near San Francisco, said 12 Medigap insurers have turned him down. Buying a health plan through Covered California, the state’s health insurance exchange, is not an option since he has primary insurance through Medicare. “That is for people who don’t have insurance, and I have insurance,” he said. “But it is as if I don’t.”

The transplant costs are substantial, and Thompson said he does not have the resources to cover his share. Kidney transplant patients can expect the preparation, surgery, tests and treatment for the first year to run more than $262,000, according to the American Kidney Fund. The immunosuppressant drugs, which patients will need for the rest of lives to ensure their body does not reject the new kidney, cost another $2,000 to $4,000 a month.

No Hospital Mandate

Hospitals and doctors are not required to provide care for Medicare patients unless it’s a medical emergency, a Medicare official said.

Joe Baker, president of the Medicare Rights Center, said that they can turn away Medicare patients for any number of reasons, including inability to pay their share of the bills or because providers are not taking new patients.

“Medicare beneficiaries under 65 with end stage renal disease get an organ transplant if they agree to pay their share of the costs Medicare doesn’t cover,” said Lisa Kim, a spokeswoman for Stanford Hospital, where Thompson has sought treatment.

To help Thompson find financial assistance, a Stanford social worker referred him to Christina Dimas-Kahn, who heads the San Mateo County office of the California Department of Aging’s Health Insurance Counseling and Advocacy Program (HICAP). She said he is one of several clients with end stage renal disease that HICAP counselors have tried to help in the past few years, “But people with the disease don’t have whole lot of options if they are under 65,” she said.

Danny Thompson, 53, needs a kidney transplant and both of his sons want to give him one of theirs (Heidi de Marco/KHN).

Thompson needs a kidney transplant and both of his sons want to give him one of theirs. (Heidi de Marco/KHN)

Thompson recently learned that he could qualify for Medi-Cal, California’s Medicaid program for low-income people, which Dimas-Kahn said would cover his transplant expenses. But Thompson said that coverage would kick in only after he paid a $2,500 deductible every month, which he cannot afford.

If Thompson divorced his wife of 30 years, her income wouldn’t be counted along with his Social Security disability benefits and it’s possible he wouldn’t have to pay the deductible. That’s not a good alternative, he said. “We made vows — rich or poor, in sickness or in health — you stay married.”

‘Crazy Patchwork’ Of Regulations

Another solution could be moving to another state, such as Delaware. That’s where Heather Block, a politically savvy project manager for federal and international organizations, took on her state legislature after she was diagnosed with advanced breast cancer.

“I considered myself lucky when I became eligible for Medicare but that 20 percent co-pay with no out-of-pocket maximum is exorbitant for anyone let alone someone with a serious illness,” she said.

Block could get Medicare before turning 65 because she qualified for disability benefits, but she couldn’t get Medigap coverage. Two years ago, she spearheaded a successful campaign to change state law, forcing insurers to sell Medigap policies to anyone when they first enroll in Medicare regardless of age, without basing rates on their health conditions.

“It is insane that we have to go through this crazy patchwork of state regulations,” said Block, whose monthly charges for cancer drugs alone range as high as $9,800. Without Medigap, medical bills would eventually deplete her savings.

Prospects for a nationwide solution are dim because expanding Medigap coverage could lead to these beneficiaries with disabilities receiving more care and raising costs for the Medicare program. Congress is looking for strategies to curb Medicare spending, not increase it, Burns said.

The health insurance industry’s trade association opposes expanding Medigap to include all Medicare beneficiaries younger than 65 with end stage renal kidney disease. Since treatment for those patients can be so expensive, adding them could increase Medigap premiums for everyone, said Cindy Goff, a vice president at America’s Health Insurance Plans. She pointed to Medicare statistics that show when the program covers patients over 65 with end-stage renal disease, their care averages nearly nine times more than other Medicare beneficiaries.

Older adults are “super price-sensitive” and raising premiums “would basically price them out of being able to get the Medigap protection they want,” said Goff.

“The insurance company knows that these patients coming through the door are going to use services,” said LaVarne Burton, president of the American Kidney Fund. “In most instances, if they don’t get treatment, they will die.”

This post originally appeared at Kaiser Health News on February 3, 2016.

Medicare Open Enrollment: October 15-December 7

Do you have Medicare?

The Open Enrollment Period to make changes to your Medicare coverage began on Triage Cancer Medicare Maze WebinarOctober 15 and will end on December 7!

As there will be changes to how much it costs for Medicare Part B and Part D plans, it can be worth your while to shop around and make sure you have coverage that works for you. Any changes you make to your Medicare coverage will take effect January 1.

Here’s a quick refresher on what exactly you get from your Medicare plan:

  • Part A: Covers inpatient care in a hospital or other similar setting
  • Part B: Covers outpatient care like doctor visits, blood tests, imaging tests, and durable medical equipment. Medicare Part A/B is referred to as Original Medicare and can be used with any provider who accepts Medicare. In 2016, the projected cost for Medicare Part B is $159.30 per month. However, there is currently an effort underway to get Congress to reduce the Part B premium cost for 2016. If you cannot afford the Part B premium, you can apply for help here.
  • Part D: Covers prescription drugs and plans vary where you live. Plan costs will be based on the plan you choose. The Medicare Part D Plan deductible will jump to $360 in 2016, from $320 in 2015.
  • Part C: Also called Medicare Advantage plans, they offer Medicare coverage under Parts A, B, and D, through a managed care plans (HMO or PPO). Plans vary based on where you live, but must provide the minimum coverage required by Medicare. Part C plans can be less expensive, but have limited provider choices.

If you already have a Medicare Part D plan, be sure to review its current prescription drug coverage for any major changes to the prescriptions you take. If you are looking to enroll in a new or different Part D plan, compare your options here.

If you or a loved one is managing the costs of care due to cancer, understanding your Medicare options is especially important. Prescriptions used to help manage pain and nausea or to treat cancer can be costly and enrolling in the right prescription drug coverage is important. As you may have seen in the news, drug prices have been on the rise, and this includes drugs that are being used to treat cancer.

Something to be aware of as you look for Medicare coverage is the presence of fraud or scams. Here are some tips to avoid being a victim of fraud:

  1. Remember you do NOT have to change your plan if it still meets your needs.
  2. Beware of free prizes, trips, or other gifts offered in exchange for enrolling in a plan.
  3. Never give out your Medicare or Social Security number to someone unless you are certain of their credentials. (Rule of thumb: don’t give out personal information to someone who calls YOU, vs. someone that YOU call).

As you start looking for the right Medicare and Medigap plans that are right for you, you may have questions. The Centers for Medicare & Medicaid Services and are reliable resources to help answer any questions you may have.

Don’t be afraid to ask for help. Your family and friends may be able to help you make coverage decisions. Your health care team can also provide you with useful information about the prescription drugs or treatments that you may need now or in the future, so that you can make sure that you pick a plan that covers those things.

There are also community organizations who are available to help you navigate your Medicare choices, called State Health Insurance Assistance Programs. Click here to find the program where you live.

It never hurts to shop around, even just to get piece of mind that the plan that you already have is the best one for you.

Still have questions? Watch our webinar on Making Sense of the Medicare Maze: