ARE YOU OVERPAYING FOR PART D COVERAGE?

Posted: October 10, 2019, 1:24PM

In 2019, one million Medicare beneficiaries with the Low Income Subsidy (LIS or Extra Help) paid an average of approximately $24 / month for Part D premiums. They could have saved money had they been enrolled in a 'benchmark' plan.

People who qualify for the full Medicare Part D LIS do not pay premiums if they enroll in plans with "benchmark" prescription drug premiums. Benchmark plans have premiums at or below a cut-off in each region, which is set yearly by Centers for Medicare and Medicaid Services. LIS recipients who are enrolled in a Prescription Drug PLan or Medicare Advantage plan wiht Part D premiums above the CMS cut-off must pay the difference between the benchmark premium and the premium charged by the plan.

Choosers (LIS recipients who pick a plan at any point in their Medicare eligibility) who were auto-enrolled in a benchmark plan by CMS are automatically moved to a different plan if their plan's costs are above the benchmark in any subsequent year.

LIS recipients who pick a plan at any point in their Medicare eligibility are not moved automatically if their plan's costs are above the benchmark. If these LIS recipients do not affirmatively choose a new benchmark plan, they will have to paythe difference betweent he benchmark premium and the premium charged bytheir current Prescription Drug Plan.

Choosers receive a notice in early November on tan paper informing them of their new premium and offering them a list of plans available with no premium liability. This notice goes to any chooser who will pay a premium for the first time or whose premium will go up. Choosers do not receive the tan notice if they are already paying paying a premium and that premium stays the same or goes down.

For assistance, talk to your State Health Insurance Assistance Program (SHIP) counselor. Assistance is also available through 1 800 Medicare or the Medicare.gov website.

Source: National Center on Law & Elder Rights, "Your Low-Income Clients May be Overpaying for Part D Prescription Drug Coverage", Georgia Burke (Justice in Aging), October 2019.