Medicare approves prescription drug plansMedicare formally approved the drug plans that will offer coverage under its upcoming prescription drug benefit today.
Prescription drug plans will be available to seniors in every state, with between 11 and 20 organizations offering plans in each region, according to the Department of Health and Human Services. Every state but Alaska will have at least one prescription drug plan with a premium of less than $20 a month.
HHS has said the average monthly premium will be around $32.
Mark McClellan, administrator of the Center for Medicare and Medicaid Services (CMS) within HHS, told The Wall Street Journal that these options are lower priced than expected due to competition among plans participating in the federal program.
Nine organizations will offer drug coverage nationwide, HHS said. Coverage will be available as a standalone benefit, or beneficiaries can select a Medicare Advantage plan, a privately administered version to be available in 44 states. In every state, at least five prescription drug plans will offer coverage with no premium to beneficiaries who qualify based on income.
All plans are required to provide coverage at least as good as Medicare's standard coverage, which pays about 75 percent of drug costs after a $250 deductible, up to $2,250, HHS said. Medicare, which also provides coverage against very high expenses, would pay more than half of a typical beneficiary's drug costs, or more than $1,100, according to department figures.
Part D of the 2003 Medicare Modernization Act provides prescription drug coverage to the program's 40 million beneficiaries.
Private companies that offer Medicare-approved plans can start marketing them on October 1, the same time HHS expects to release a handbook to help people with Medicare make coverage decisions. Seniors can start enrolling November 15 for coverage, which begins January 1, and will have until May 15 to sign up without penalty.
The nine plans approved to offer nationwide coverage are Aetna Life Insurance, Connecticut General Life Insurance, Medco Containment Life Insurance, MemberHealth, PacifiCare Life and Health Insurance, SilverScript Insurance Company, UniCare, United Health Care Insurance Plan and WellCare Health Plan.