**INTRODUCTION**

The U.S. Department of Health and Human Services Office on Disability
(OD) convened a regularly scheduled Quarterly Constituent Input Meeting
on May 24, 2005, in the Deputy Secretary's Conference Room in the Hubert
H. Humphrey Building, Washington, D.C. Over 40 constituent organizations
and HHS agencies and offices were represented, either in person or by
conference call.[^1] These quarterly meetings give representatives from
the national disability organizations (representing 54 million Americans
with disabilities of all kinds) opportunity to be heard by HHS on key
topics of concern both to the Federal government and to persons with
disabilities.

A recommendation made at the February 22, 2005 Constituent Input meeting
-- further education about MMA Drug Benefit[^2] program -- was the
springboard for the May 24, 2005 meeting. As a result of that
recommendation, the May 2005 constituent input meeting focused on that
specific topic, providing participants the knowledge and information
they need to help better educate the disability constituencies

nationwide about this important program change.

The May 24, 2005, Constituent Input Meeting provided significant
exchange among CMS Administrator Dr. Mark McClellan and senior CMS
outreach staff, and disability constituency representatives about
Medicare prescription drug benefit (also referred to as "Medicare Rx" in
this document) outreach campaign plans.

The meeting was designed to provide an important opportunity for
representatives of disability constituency organizations to brainstorm,
to ask and receive answers to Medicare Rx-related questions, to share
recommendations, and to identify opportunities to coordinate Medicare
prescription drug outreach plans.

Office on Disability Director Margaret Giannini, MD, FAAP, opened the
meeting by welcoming those in attendance. She explained the ground-rules
for the meeting. Each participant was given time to raise issues
important to their constituencies. They were asked to state at least one
issue, and then to provide at least one recommendation that responds to
the issue raised. If time permitted, the participant had the option of
raising other issues.

During the course of the meeting, participants heard from Secretary Mike
Leavitt's Chief-of-Staff, Richard McKeown. He described the importance
of implementation of the Medicare Modernization Act (MMA), including the
Medicare Prescription Drug Benefit Program, to the Secretary's 500-day
plan that is guiding the Departments work and priorities. He noted how
the Medicare population has been growing as the "baby-boom" generation
moves through mid-life. In particular, he observed how the partnerships
developed between CMS and the disability community can help achieve the
kind of transformation of the healthcare system and the modernization of
Medicare and Medicaid envisioned in the 500-day plan. Mr. McKeown stated
that Secretary Leavitt has placed an emphasis on promoting high-quality
community-based, consumer-centered/self-directed care that is both
financially sustainable and flexible enough to meet individual needs.

Mr. McKeown noted that a forum such as the Office on Disability's
quarterly Constituent Input Meetings, provides a wonderful opportunity
for exchange and recommendations of an important, often less-heard
segment of the population.

**MEETING SUMMARY**

The following provides a summary of the questions of the disability
constituency organization representatives who attended the meeting and
shares the observations, comments and suggestions made by CMS
Administrator McClellan and his staff as well as constituent responses
and recommendations.

A detailed, structured set of questions and answers regarding the
Medicare prescription drug benefit (also referred to in this document as
"Medicare Rx"), developed by CMS with input from the Office on
Disability, in further response to questions posed at the meeting are
found at Appendix B and at www.cms.hhs.gov/partnerships. \[Please note
that both sets of questions have been combined into one at this
website.\]

**[Constituency/CMS Exchange]{.smallcaps}**

Dr. Giannini posed an opening question related to the Medicare
prescription drug benefit and then recognized each of the constituency
group representatives who posed questions or made suggestions for
collaborative work to "help get the word out" about Medicare
prescription drug plan registration.

Particular attention was given to the population of "dual eligibles" who
are covered by both Medicaid and Medicare. Under MMA, for the purposes
of the prescription drug coverage benefit only, persons with dual
eligibility will be transferred automatically from Medicaid to a
Medicare prescription drug plan effective January 1, 2006. In
mid-October 2005, CMS will send a letter to people who are "dual know
and let them know into which plan they will be enrolled
*[if]{.underline}* they do not enroll in one on their own. It would be
best if the beneficiary selected one because there is no guarantee that
the plan randomly selected by Medicare will meet an individual's
particular needs.

***What are "special needs" prescription plans?***

Special needs prescription plans are designed to ensure that persons
with disabilities -- and others -- have the health services they need.
This extends far beyond prescription needs to help prevent illnesses and
secondary conditions. Special needs plans try to prevent the
complications of chronic disease and disabilities. In fact, prevention
-- not just screening, but early intervention that is provided to help
reduce the incidence of secondary illnesses -- is becoming an increased
focus of both Medicare and Medicaid.

While not identical to special need plans, Medicare Advantage Plans, for
example, are benefit packages specifically designed for persons with
chronic illness who are at highest risk for high need for and use of
services (e.g., heard disease, diabetes, HIV/AIDS). Through this
program, CMS is able to assess and meet the needs of persons at greatest
risk for losing community-based services for institutional care
(including persons with dual eligibility). By adopting this approach
that focuses on individuals with the highest risk, CMS can help
beneficiaries avoid clinically unnecessary institutionalization or acute
care hospitalization *and* receive better care in terms of quality,
continuity and coordination, and cost.

Over 60 Medicare Advantage Plans will be in place in FY 2006; CMS hopes
to double or triple the number in the next three years. And CMS will be
assessing these programs; it wants to know from the disability community
how the programs are doing. The intent is to promote high quality care
and that means measuring how well the programs are doing what they are
intended to do.

***What is the geographic distribution of special needs plans? What is
being done for rural areas? What is being done to ensure that care for
children and youth with disabilities is continued under special needs
plans.***

Special need plans, effective for 2004 and 2005, exist in at least 21
states, the District of Columbia, and the territory of Puerto Rico. In
2006, at least one special needs plan will be in place in most of the
states.

At the present time, special needs plans are primarily found in urban
areas, such as in California and Texas. While rural areas have not been
as involved in establishing special needs plans, the situation *is*
improving, particularly when PPOs are used. In fact, special needs plans
are offered by Medicare Advantage Organizations that cover both rural
and urban areas. In 2006, still more coverage for rural areas will be
provided.

Special needs plans were enacted by Congress for Medicare Advantage
individuals who are institutionalized, entitled to medical assistance
under a state plan under Title XIX, or experiencing a severe or
disabling condition (or conditions) who would benefit from enrollment in
a specialized Medicare Advantage plan. Enactment of special needs plans
should not have an adverse impact on children and youth with
disabilities. To the extent that children and youth meet the eligibility
criteria for the Medicare Advantage plan offering the special needs
plan, they could join the Medicare Advantage Plan.

***Exactly what will the Medicare prescription drug plans consist of?***

Medicare prescription drug coverage is insurance provided by private
companies that have been approved by Medicare. Medicare Rx plans will
cover both brand name and generic drugs. Plans must cover all types of
drugs required by Medicare, but each plan may have rules about what
drugs are covered in different drug categories. These are listed on the
plan "formulary".

***When will information about specific formularies be made
available?***

Approval of formularies is being undertaken at this time. CMS has been
assessing medications that people are currently are using across six
categories -- including those for the treatment of mental illnesses and
HIV. However, specific formulary information, including pricing and
additional information, will be finalized and posted to the CMS website
around October 13, 2005. The site will include an interactive program to
help beneficiaries choose an individualized Medicare Rx plan based on
the medications and pharmacies that beneficiaries already are using.

In the next few weeks, information about the low-income subsidy for
Medicare prescription drugs will be sent out by the Social Security
Administration (SSA) encouraging the 5-7 million people who SSA believes
qualify for this benefit based on their past earning history to sign up
for the program. The program is for individuals at 135% of poverty level
or lower and will provide medications at a nominal cost.

CMS has over 60,000 local events being undertaken to help promote the
low-income assistance program under the Medicare prescription drug
benefit; the message is to join a plan now, or be enrolled automatically
if one is not chosen by December 31, 2005.

A separate letter will be sent by CMS to all persons who are dually
eligible for enrollment in the Medicare prescription drug benefit, a
substantial number of these individuals are persons with disabilities.
They will not need to do anything to sign up. The letter will alert them
that the low income subsidy will become available on January 1, 2006.

CMS appreciates the significant work being done by disability leaders to
reach out to disability constituencies to inform beneficiaries. CMS will
be making a major push in the fall to bring all persons eligible into
the program and welcomes the ongoing collaboration of the disability and
provider organizations to achieve broad-based education.

***How are CMS and other relevant agencies and informing disability and
other affected constituencies and organizations at the state and local
level about the Medicare prescription drug benefit?***

The Social Security Administration has made funding available to
underwrite a broad range of local events. CMS is working to build in a
Medicare prescription drug benefit component as a subset of an upcoming
National Governors Association meeting on mental health needs. CMS also
would be happy to "piggyback" on meetings being convened by disability
constituency and provider organizations. CMS is collaborating with Area
Agencies on Aging, Housing and Urban Development centers and Department
of Transportation grantees for programs for seniors and persons with
disabilities as well. Regional CMS offices are prepared to work with
organizations at the regional, state, and local levels to "get the word
out" through existing resources and planned events and meetings. In
fact, to the extent possible, CMS will send representatives to national
and regional constituency and provider meetings to speak about the
Medicare Rx benefits and the issues of concern to providers and/or
beneficiaries. A list of regional contacts was made available (see
Appendix B)

***A great deal of information has been made available by CMS on the
Internet. What steps are being taken to educate those who may not be
able to access the internet?***

Persons are able to receive information about the Medicare Rx benefit
both in face-to-face counseling or by phone. By calling 1-800-Medicare,
persons can receive information by phone. Information also is available
through State Health Insurance Programs (SHIPs) that can provide
personalized counseling both in-person and by phone. Area Agencies on
Aging and public libraries also help provide information.

It is equally important that organizations concerned about the issues
help in the educational process. In fact, because many beneficiaries
have informal caregivers, caregiver organizations, too, should become
engaged.

***Will states be required to ensure continuity of drug benefits to dual
eligible participants? And will the continuity of drug benefits for
persons who are dual-eligible be ongoing or time-restricted?***

When it comes to persons with dual eligibility, CMS work groups are in
place in all states to help persons with dual eligibility make the
transition to Medicare Rx plans. Abby Block is the lead for this
particular formulary-related transition. Most of the issues related to
continuity of medication will be addressed at the state level, since CMS
is not making any rulings related specifically to the use of particular
medications.

The goal of CMS, however, is to ensure that if persons were covered for
treatment with particular medications, they continue to be covered.
Clearly, CMS does not want to jeopardize the health of those persons on
specific drug regiments (e.g., persons with HIV/AIDS). A letter has been
sent to State Medicaid agencies to ask that they make available a 90-day
transition supply of medications for dually-eligible persons who will be
transitioning to Part D.

All Medicare prescription drug benefit plans must offer a basic or
standard package of prescription drugs. A standard plan may not cover
benzodiazepines. However, if a plan offers more than standard coverage,
it may elect to cover this type of drug. The premium for these plans
will most often be higher than for standard plans.

More information about the formularies and the six classes of
medications is available for providers at the CMS website
\<partners.cms.gov\>. New information on the drug benefit is available
to help train providers on a CD available from CMS as well.

***What is CMS's "Reach" program and how does it work?***

The REACH (Regional Education about Choices in Health) program is a
national education and publicity campaign implemented at the local level
by CMS's Regional Offices and their partners. The REACH campaign works
through partnerships to increase awareness of the Medicare program and
resources among hard to reach populations. It provides a list-serv and
other information to partner organizations, and provides experts to help
educate about the Rx benefit at the community level. Contacts have been
identified in every regional office; these individuals can help identify
the best local information available. CMS is providing information to
the Office on Disability to help disability organizations -- including
behavioral health care programs -- "get the word" out about Medicare
prescription drug coverage, particularly for persons who are dually
eligible. (See Appendix B for this information)

***How is CMS reaching Spanish-speaking communities to educate them
about the Medicare prescription drug benefits? What efforts are being
made to educate other non-English-speaking populations?***

CMS is coordinating outreach programs to Hispanic populations, utilizing
persons with specialized expertise. CMS will provide a list of the most
relevant "preferred terminology" regarding Medicare Rx coverage in
Spanish to the National Alliance for Hispanic Health. CMS is working to
undertake special mailings to Asian American and other non-English
speaking populations who may be affected by the prescription drug
benefit changes, with material in Russian, Korean, and Vietnamese.
Materials in other languages also may be developed.

***What kinds of outreach, education and assistance in workload
management is being undertaken by CMS to help physicians groups work
with their patients to help them choose the best plans for them?***

Meeting participants suggested it might be of benefit to CMS to drill
down to sub-specialty provider groups that have expertise with persons
with disabilities. The provision of CME for physician training about the
Medicare prescription drug benefits may also be of help. CMS noted that
materials are available to providers to help them better educate their
patients with disabilities about Medicare prescription drug benefits;
the CMS clearinghouse has pamphlets that can be distributed at the local
provider level; some materials can made available at the 4^th^ grade
reading level.

***If CMS anticipates that 80% of all dual-eligible individuals are to
be enrolled in the Medicare prescription drug benefit program in
January, how will the remaining 20% be reached to ensure that no one
"falls through the cracks"? And what about individuals who are outside
the Medicare/Medicaid system** **today who should not be? How can they
be reached?***

All dually eligible individuals will be enrolled in the Medicare
prescription drug benefit program automatically in a plan selected at
random by Medicare *unless they select a plan for themselves*. However,
such individuals would be advised to review the range of drug plan
options available to them between now and January 1, 2006, and choose
the plan that best meets their needs for such things as continuous
coverage of current medications. Further, CMS has sent letters to State
Medicaid agencies to encourage states to ensure that dually eligible
individuals can receive a 90-day transition supply of their clinically
prescribed medications as the changeover to the Medicare prescription
drug benefit program takes place.

When it come to the question of persons who are currently outside the
Medicare/Medicaid system who should not be, CMS has been working to
overcome this problem and will continue to do so.

***What is the "prescribing exception" provision of the Medicare Part D
prescription drug program?***

All Medicare Rx plans must have an exception process for enrollees to
request a drug that is not on the covered drug list, or that the
enrollee thinks should be covered at a lower co-payment. The enrollee
should contact the plan and ask for an exception. Mostly likely, they
will have to provide written information from their doctor about why
only a specific drug (in a class or category) will benefit them and why
others may be harmful to their health. If the plan denies the exception,
the enrollee can go through the plan's appeal process.

***What efforts are being made to make information about the Medicare
Part D prescription drug program more readily accessible on the CMS
website?***

In late September 2005, the CMS website \[cms.hhs.gov\] website will be
redesigned. All the current content will be migrated into a management
tool called *Stellant.* Under this new design, there will be a section
called "Prescription Drug Plan Center" which will contain all types of
information about the MMA, Prescription Drug coverage and preventive
benefits. The section will be accessible by every page of the website
and should be easy to navigate.

**NEXT STEPS**

The input provided at this meeting is helping CMS and the Office on
Disability better understand the range of questions and issues that need
to be addressed in public forums related to the Medicare Rx drug
program. It has helped build alliances between CMS and both disability
consumer and provider constituencies to help inform the public affected
by this significant change in coverage, particularly for persons with
dual Medicaid/Medicare eligibility.

The dialogue needs to continue beyond the Office on Disability's
quarterly constituency input meetings. To that end, a range of CMS
points of contact for outreach have been identified and will be shared
with meeting participants (See Appendix B). The overarching goal is to
promote partnerships between CMS and disability constituency
organizations at the National, state and local levels to help ensure
that everyone who may be affected by the Medicare Rx program's
implementation on January 1, 2006 is well-educated about the program and
has the tools and knowledge that will ensure that persons with
disabilities have the ability to choose their prescription drug coverage
in a way that can foster ongoing self-determination and independence in
the community.

\###

*Electronic copies of this report and its appendices as well as reports
from other Constituent Input meetings are available on the Office on
Disability website at [www.hhs.gov/od/](http://www.hhs.gov/od/)*

**Appendix A**

[Office on Disability]{.underline}

Department of Health and Human Services

# Constituency Expert Input Meeting

# Participating Constituent Organizations and Federal Agencies

May 24, 2005

**[Constituency Organizations]{.underline}**

American Academy of Pediatrics

American Association of Homes and Services for the Aging

American Association of People with Disabilities

American Council of the Blind

American Health Care Association

American Physical Therapy Association

American Speech-Language-Hearing Association

The ARC and United Cerebral Palsy

Autism Society of America

Brain Injury Association of America

Child Welfare League of America

Consortium for Citizens with Disabilities

Epilepsy Foundation

Family Voices

Iona Senior Services -- Voice of the Retarded

National Adult Day Services Association

National Alliance for Caregiving

National Alliance for Hispanic Health

National Asian Pacific Center on Aging

National Association for State Directors of Developmental Disabilities
Services

National Association of Protection and Advocacy Systems

National Association of State Mental Health Program Directors

National Center for Assisted Living

National Council for Independent Living

National Council on Aging -- Access to Benefits Program

National Council of Community Behavioral Healthcare

National Mental Health Association

National Multiple Sclerosis Society

**[Federal Participants]{.underline}**

Administration on Aging -- DHHS

Administration for Developmental Disabilities, Agency for Children &
Families-- DHHS

Centers for Medicare and Medicaid Services -- DHHS

Office on Disability -- DHHS

Office of the Assistant Secretary for Planning and Evaluation \-- DHHS

President's Committee on Persons with Intellectual Disabilities - DHHS

**Appendix B**

**CENTERS FOR MEDICARE AND MEDICAID SERVICES**

**QUESTIONS AND ANSWERS ON THE MEDICARE DRUG BENEFIT PROGRAM**

**Group 1**

**Basic Information**

**[What is Medicare Prescription Drug Coverage?]{.underline}**

Medicare prescription drug coverage is insurance provided by private
companies that have been approved by Medicare. Starting January 1, 2006,
new Medicare prescription drug coverage will be available to everyone
with Medicare. This drug coverage may help lower prescription drug costs
and help protect against higher costs in the future.

You can get Medicare prescription drug coverage in the following ways:

-   Through Medicare Advantage Plans or other Medicare Health Plans that
    are offering coverage for prescription drugs.

-   Through Medicare Prescription Drug Plans, which add coverage to the
    Original Medicare Plan, and some Medicare Cost Plans and Medicare
    Private Fee-for-Service Plans.

You can choose and join the Medicare drug plan that works for you. You
will have to pay a monthly premium. All drug plans must provide coverage
that is at least as good as standard Medicare prescription drug
coverage. Some plans might offer more coverage and additional drugs for
higher monthly premiums. If you decide not to join a Medicare drug plan
when you are first eligible, you may have to pay a penalty if you decide
to join later.

If you have limited income and resources, you may qualify for extra
help. Most people who qualify for this extra help will pay no premiums,
no deductibles, and no more than \$5 for each prescription. The amount
of extra help depends on your income and resources. If you qualify, you
will need to join a plan to get drug coverage. If you apply and qualify,
and don't join a plan, Medicare will enroll you in one by May 15, 2006
to make sure you get this important coverage.

**[What if I already have prescription drug coverage?]{.underline}**

If you already have prescription drug coverage, you should talk to your
plan, benefits administrator, or insurer before making any changes. You
will be notified about any changes in your current coverage so you can
decide if you should join a Medicare drug plan.

**[Should I join a Medicare drug plan even if I don't take many
prescription drugs?]{.underline}**

You should still consider joining a Medicare drug plan in 2006. As we
age, most people need prescription drugs to stay healthy. For most
people, joining now means you will pay the lowest possible monthly
premium. If you don't join a plan by May 15, 2006, and you don't
currently have a drug plan that, on average, covers at least as much as
standard Medicare prescription drug coverage, you will have to wait
until November 15, 2006 to join. When you do join, your premium cost
will go up at least 1% per month for every month that you wait to join.
Like other insurance, you must pay this penalty as long as you have
Medicare prescription drug coverage. If you join by December 31, 2006,
your coverage will begin January 1, 2007.

**[Where can I get more information about Medicare prescription drug
coverage?]{.underline}**

For more information on Medicare prescription drug coverage, read the
"Medicare & You 2006" handbook mailed to you in October 2005. It will
list the specific plans available in your area. After October 2005, if
you need help:

-   Visit www.medicare.gov on the web and get personalized information.

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-   Call 1-800-MEDICARE (1-800-633-4227). TTY users should call
    1-877-486-2048. Have your Medicare card, a list of drugs you use,
    and the name of the pharmacy you use ready when you call.

-   Get a free copy of the booklet "Your Guide to Medicare Prescription
    Drug Coverage," (CMS Pub. No. 11109) on www.medicare.gov or by
    calling 1-800-MEDICARE.

-   Call your State Health Insurance Assistance Program for free
    personalized health insurance counseling.

-   Check for local events for help joining. Contact your local office
    on aging. For the telephone number, visit www.eldercare.gov on the
    web.

**Important Dates**

**[When can I join a Medicare drug plan?]{.underline}**

The first time to join is November 15, 2005--May 15, 2006. In most
cases, if you don't join by May 15, 2006, and you don't currently have a
drug plan that, on average, covers at least as much as standard Medicare
prescription drug coverage, you will have to wait until November 15,
2006 to join. When you do join, your premium cost will go up at least 1%
per month for every month that you wait to join. Like other insurance,
you must pay this penalty as long as you have Medicare prescription drug
coverage. If you join by December 31, 2006, your coverage will begin
January 1, 2007.

**[When can I join if I miss the May 15, 2006 deadline?]{.underline}**

You will be able to join November 15--December 31 of each year. Your
coverage would begin January 1 of the following year. If you choose not
to join when you are first eligible and later change your mind, you may
pay a penalty.

**Costs and Coverage**

**[What are the out-of-pocket costs for Medicare prescription drug
coverage?]{.underline}**

When you get Medicare prescription drug coverage, you pay part of the
costs and Medicare pays part of the costs. You pay a premium each month
to join the drug plan. If you have Medicare Part B, you also pay your
monthly Part B premium. If you belong to a Medicare Advantage Plan or
Medicare Cost Plan, the monthly premium you pay to the plan may increase
if you add prescription drug coverage.

Your costs will vary depending on which plan you choose. Your plan must,
at a minimum, provide a standard level of coverage as shown below. Some
plans offer more coverage or lower premiums.

*Standard Coverage* (the minimum coverage drug plans must provide):

If you join in 2006, for covered drugs you will pay:

-   A monthly premium (varies depending on the plan you choose, but
    estimated at about \$37 in 2006)

-   The first \$250 per year for your prescriptions. This is called your
    deductible.

After you pay the \$250 yearly deductible, here's how the costs work:

-   You pay 25% of your yearly drug costs from \$250 to \$2,250, and
    your plan pays the other 75% of these costs, then

-   You pay 100% of your next \$2,850 in drug costs, then

-   You pay 5% of your drug costs (or a small copayment) for the rest of
    the calendar year after you have spent \$3,600 out-of-pocket. Your
    plan pays the rest.

**[What does a Medicare drug plan cover?]{.underline}**

Medicare drug plans will cover generic and brand-name drugs. Plans may
have rules about what drugs are covered in different drug categories to
be sure people with different medical conditions can get the treatment
they need.

Most plans will have a formulary, which is a list of drugs covered by
the plan. This list must always meet Medicare's requirements, but it can
change when plans get new information. Your plan must let you know at
least 60 days before a drug you use is removed from the list or if the
costs are changing. If your doctor thinks you need a drug that isn't on
the list, or if one of your drugs is being removed from the list, you or
your doctor can apply for an exception or appeal the decision.

**[Will my drugs be covered?]{.underline}**

Medicare Prescription Drug Plans must include at least two drugs in
every drug category. The plans must also do the following:

-   Make sure you have convenient access to retail pharmacies;

-   Have a process for you to get drugs that are not on the list of
    covered drugs (formulary) when it is medically necessary; and

-   Provide useful information to you, such as how formularies and
    medication management programs work, information on saving money
    with generic drugs, and grievance and appeal processes.

Make a list of all the your current medications, including name, dose
size (for example- 2 pills, 300mg in each pill), dosage frequency (for
example- 2 times a day) and monthly costs of your current prescriptions.
You can use this information to compare the list of drugs (also called a
formulary) that are covered under each plan. You can get the list of
drugs a plan covers by calling the plan, visiting the plan's website, or
visiting www.medicare.gov on the web. This information will be available
in October from the plans and on October 13 at medicare.gov on the web.

**Effect on Current Drug Coverage**

**[What do I need to know if I have prescription drug coverage from a
former or current employer or union?]{.underline}**

Medicare will help employers or unions continue to provide retiree drug
coverage that meets Medicare's standards. Your (or your spouse's) former
or current employer or union will send you information about how your
current coverage compares to the Medicare standard prescription drug
coverage by November 14, 2005. This information is important because it
can affect the decision you will need to make this fall about if and
when you sign up for Medicare prescription drug coverage.

If your (or your spouse's) employer or union has determined that your
current coverage, on average, is at least as good as the Medicare
standard prescription drug coverage (called creditable prescription drug
coverage):

-   You can keep it as long as it is still offered by your employer or
    union; and

-   You won't have to pay a penalty if your employer or union stops
    offering prescription drug coverage as long as you join a Medicare
    drug plan within 63 days after the coverage ends -- even if you join
    after May 15, 2006.

If your (or your spouse's) employer or union has determined that your
current coverage, on average, is not at least as good as standard
Medicare prescription drug coverage, if you want to join a drug plan,
you must join by May 15, 2006 to avoid a penalty.

Caution: If you drop your employer or union coverage, you may not be
able to get it back. You also may not be able to drop your employer or
union drug coverage without also dropping your employer or union health
coverage.

If your employer or union plan is not as good as Medicare prescription
drug coverage, find out about your options from your benefits
administrator. You may be able to

-   Keep your current employer or union drug plan and join a Medicare
    drug plan to give you more complete prescription drug coverage.

-   Only keep your current employer or union drug plan. But, if you join
    a Medicare drug plan after May 15, 2006, you will have to pay a
    penalty.

-   Drop your current coverage and return to the Original Medicare Plan
    and join a Medicare Prescription Drug Plan, or join a Medicare
    Advantage Plan or other Medicare Health Plan that covers
    prescription drugs. See the caution above.

**[What do I need to know if I have a Medicare Advantage Plan (like an
HMO, PPO, or PFFS Plan) or other Medicare Health Plan?]{.underline}**

Medicare is working with your Medicare Advantage Plan or other Medicare
Health Plan to help them provide even more coverage or lower costs. If
you currently have prescription drug coverage from your plan, you will
get a notice from your Medicare Advantage Plan or other Medicare Health
Plan about your prescription drug choices. Read any materials you get
from your plan carefully.

If you don't have prescription drug coverage, and want to add it, you
can

-   Check with your current health plan to see if they will offer a
    prescription drug option in 2006. If they will, you will usually be
    required to get your drug coverage from your current health plan if
    you decide to stay in the plan, *or*

-   Switch to another Medicare Advantage Plan or other Medicare Health
    Plan in your area that offers prescription drug coverage, or

-   Switch to the Original Medicare Plan and join a Medicare
    Prescription Drug Plan.

If you stay in your current plan that isn't offering drug coverage in
2006, you will have to pay a penalty if you want to switch to a plan
that offers prescription drug coverage later.

**[What do I need to know if I have a Medigap (Medicare Supplement
Insurance) policy that covers prescription drugs and I have the Original
Medicare Plan (Medicare Part A and Part B)?]{.underline}**

Medigap policies are changing. You won't be able to buy new Medigap
policies that cover prescription drugs after January 1, 2006. This fall
you will get a detailed notice in the mail from your Medigap insurance
company describing your choices for prescription drug coverage. Read the
notice carefully before making any decisions.

You must join a new plan that provides Medicare prescription drug
coverage to have Medicare help pay for drugs. This will reduce your
premium costs because Medicare pays most of the premium for Medicare
drug plans. You can first join a Medicare Prescription Drug Plan from
November 15, 2005 -- May 15, 2006.

Most prescription drug coverage offered by Medigap policies, on average,
is not at least as good as Medicare prescription drug coverage. This
means, in most cases, if you keep Medigap prescription coverage, and
don't join a Medicare drug plan by May 15, 2006, you will have to pay a
penalty if you choose to join later. Your next chance to join will be
November 15 -- December 31 of each year. Your coverage would begin
January 1 of the following year.

Contact your Medigap insurance company before you make any changes to
your prescription drug coverage. If you have your Medigap policy from a
current or former employer or union, call your benefits administrator.

**[What do I need to know if I have drug coverage from TRICARE, the
Department of Veteran's Affairs (VA), or the Federal Employee Health
Benefits Program (FEHB)?]{.underline}**

As long as you still qualify, your TRICARE, VA, or FEHB prescription
drug coverage is not changing. You should contact your benefits
administrator or FEHB insurer for information about your TRICARE, VA, or
FEHB coverage before making any changes. It will almost always be to
your advantage to keep your current coverage without any changes. If you
lose your TRICARE, VA, or FEHB coverage and you join a Medicare drug
plan after May 15, 2006, in most cases, you won't have to pay a penalty,
as long as you join within 63 days of losing TRICARE, VA, or FEHB
coverage.

**[What do I need to know if I have full coverage from my state Medicaid
program?]{.underline}**

Your Medicaid [prescription drug coverage]{.underline} is changing.
Medicare, not Medicaid, will start paying for your prescription drugs
beginning January 1, 2006. Medicaid will still cover other care that
Medicare doesn't cover.

The last day that your state Medicaid program will pay for your
prescription drugs is December 31, 2005. You will have continuous
Medicare prescription drug coverage and, in most cases, will pay a small
amount out of your own pocket. Medicare pays for almost all of the cost
of your drugs if you join a Medicare Prescription Drug Plan or a
Medicare Advantage Plan or other Medicare Health Plan with Medicare
prescription drug coverage.

Compare coverage and choose a plan. You can join a drug plan starting
November 15, 2005. Medicare will let you know the plan it has picked for
you in October 2005, but you can still compare plans and choose another
plan by December 31, 2005. If you have not joined a drug plan by
December 31, 2005, Medicare will enroll you in the plan it has picked to
make sure you don't miss a day of coverage. If you decide you want
another plan, you can switch to another plan at any time without a
penalty.

If you have Medicare and full coverage from Medicaid, and live in an
institution (like a nursing home), you will pay nothing for your covered
prescription drugs.

**[What do I need to know if I have the Original Medicare Plan (Medicare
Part A and Part B) and I don't have prescription drug
coverage?]{.underline}**

To have Medicare help pay for your drugs, you must join a plan that
provides Medicare prescription drug coverage. You can choose and join
the plan that meets your needs. If you don't use a lot of prescription
drugs now, you should still consider joining. As we age, most people
need prescription drugs to stay healthy. For most people, joining now
means you won't have to pay a penalty if you choose to join later. Your
premium will be higher if you wait to join after May 15, 2006 because of
the penalty.

You can first join a drug plan from November 15, 2005 -- May 15, 2006.
In most cases, if you don't join during this period, your next chance to
join will be November 15, 2006 - December 31, 2006 and you will have to
pay a penalty. This means you pay a higher monthly premium for as long
as you have Medicare prescription drug coverage.

**[What do I need to know if I have a Medigap (Medicare Supplement
Insurance) policy that doesn't cover prescription drugs and I have the
Original Medicare Plan (Medicare Part A and Part B)?]{.underline}**

To have Medicare help pay for your drugs, you must join a plan that
provides Medicare prescription drug coverage. You can choose and join
the plan that meets your needs. If you don't use a lot of prescription
drugs now, you should still consider joining. As we age, most people
need prescription drugs to stay healthy. For most people, joining now
means you won't have to pay a penalty if you choose to join later. Your
premium will be higher if you wait to join after May 15, 2006 because of
the penalty.

You can first join a drug plan from November 15, 2005 -- May 15, 2006.
In most cases, if you don't join during this period, your next chance to
join will be November 15, 2006 - December 31, 2006 and you will have to
pay a penalty. This means you pay a higher monthly premium for as long
as you have Medicare prescription drug coverage.

Contact your Medigap insurer for information about your policy. If you
have your Medigap policy from a current or former employer or union,
call your benefits administrator.

**Information for people with limited income and resources**

People with limited income and resources may qualify for extra help
paying for Medicare prescription drug costs. The amount of extra help
you get is based on your income and resources. You may qualify if your
income is less than \$14,355 or \$19,245 for a married couple living
together, and your resources are less than \$11,500 if you are single or
\$23,000 if you are married and living with your spouse. \[Income levels
are for 2005, resource and cost-sharing amounts are for 2006, and will
increase each year. The size of your family can also affect whether you
qualify based on income. If you live in Alaska or Hawaii, income levels
are higher.\]

**[How do I know if I qualify for extra help?]{.underline}**

You may automatically qualify for extra help. You may get a letter from
Medicare saying that you automatically qualify for extra help and don't
have to fill out the application from the Social Security Administration
(SSA).

You automatically qualify for extra help and don't need to apply if you:

-   Have Medicare and full coverage from a state Medicaid program that
    currently pays for your prescriptions. You should join a plan that
    meets your needs by December 31, 2005 because Medicaid will no
    longer pay for prescription drugs. If you don't, Medicare will
    enroll you in a plan effective January 1, 2006 so you don't miss a
    day of coverage. You can drop the plan or switch to another any
    time.

-   Get help from your state Medicaid program paying your Medicare
    premiums (belong to a Medicare Savings Program). You should join a
    plan that meets your needs by December 31, 2005. If you haven't
    signed up by May 15, 2006, Medicare will enroll you in a plan
    effective June 1, 2006 so you don't have to pay a penalty. You can
    drop the plan or switch to another any time.

-   Get Supplemental Security Income. You should join a plan that meets
    your needs by December 31, 2005. If you haven't signed up by May 15,
    2006, Medicare will enroll you in a plan effective June 1, 2006 so
    you don't have to pay a penalty. If Medicare enrolled you in a
    prescription drug plan, you can switch to another plan one time
    before December 31, 2006.

You may apply and qualify for extra help.

If you didn't automatically qualify, the Social Security Administration
(SSA) sent people with certain incomes an application for this extra
help. If you got this application, fill it out and send it back to SSA
as soon as possible. If you didn't get an application but think you may
qualify, call 1-800-772-1213, visit www.socialsecurity.gov on the web,
or apply at your State Medical Assistance office. You can also visit the
website to get more information. After you fill out the application from
SSA, SSA will mail you a letter telling you if you qualify for extra
help in two to three weeks.

**Group 2**

**Basic Information**

**[Is there information and help available to compare Medicare drug
plans?]{.underline}**

-   Look for information about plans in your area in the "Medicare & You
    2006" handbook, which you will get in the mail in October;

-   Visit www.medicare.gov on the web. Starting in October, you can look
    under the "Search Tools" option for detailed information about the
    plans available in your area; or

-   Call 1-800-MEDICARE (1-800-633-4227). TTY users should call
    1-877-486-2048.

**[When and how often can I switch my Medicare drug plan?]{.underline}**

Generally if you join a Medicare Prescription Drug Plan, you can only
change plans under certain circumstances. You can choose to switch your
current plan from November 15 through December 31 of every year.

Enrollment is generally for the calendar year. In certain cases, such as
if you move or enter a nursing home, you can switch your plan at other
times.

If you have both Medicare and Medicaid, you can change plans at any
time.

**[Who can help me to find out more information about how this coverage
will work for me?]{.underline}**

For personalized assistance, you can call your State Health Insurance
Assistance Program (see your copy of the "Medicare & You 2006" handbook
for their telephone number). The handbook will be available to you
beginning in October 2005. You can also visit www.medicare.gov on the
web or call 1-800 MEDICARE (1-800-633-4227). TTY users should call
1-877-486-2048. Look for information about events in your local
newspaper or listen for information on the radio. You can also get
personalized counseling by calling your local office on aging. For the
telephone number, visit www.eldercare.gov on the web.

**[Is this Medicare prescription drug coverage better than what I have
now?]{.underline}**

If you already have prescription drug coverage through a Medicare
private health plan or other insurance, check with your current plan to
see if this coverage is changing. Your plan or insurer will notify you
in the fall of 2005 to let you know if your coverage pays, on average,
at least as much as standard Medicare prescription drug coverage or if
it is changing.

**[What happens if I choose not to join a Medicare drug plan by May 15,
2006? Can I join later?]{.underline}**

If you don't join a plan by May 15, 2006, and you don't currently have a
drug plan that, on average, covers at least as much as standard Medicare
prescription drug coverage, you will have to wait until November 15,
2006 to join. When you do join, your premium cost will go up at least 1%
per month for every month that you wait to join. Like other insurance,
you will have to pay this penalty as long as you have Medicare
prescription drug coverage.

If you join after May 15, 2006, the next open enrollment period is
November 15, 2006 to December 31, 2006. However, coverage for people who
enroll during this period will not take effect until January 1, 2007.

**[Is there someone to help me choose a Medicare prescription drug
plan?]{.underline}**

Talk to a family member, friend, or other caregiver to help you decide
what drug coverage meets your needs. You may also

-   Visit www. medicare.gov and select the "Search Tools" option to get
    personalized information that can help you compare plans.

-   Call 1-800 MEDICARE (1-800-633-4227). TTY users should call
    1-877-486-2048.

-   Call Your State Health Insurance Assistance Program (the telephone
    number will be in your copy of the "Medicare & You 2006" handbook).

-   Look for information about events in your local newspaper or listen
    for information on the radio.

-   Call your local office on aging. For the telephone number, visit
    www.eldercare.gov on the web.

**[Do I have to join a Medicare drug plan?]{.underline}**

No. Joining a Medicare drug plan is your choice.

**[How do I join a Medicare Prescription Drug Plan?]{.underline}**

You can join a Medicare Prescription Drug Plan in the following ways:

-   [By paper application]{.underline}. Contact the company offering the
    drug plan you choose and ask for an application. Once you fill out
    the form, mail or fax it back to the company.

-   [On the plan's website.]{.underline} Visit the drug plan company's
    website. You may be able to join online.

-   [On Medicare's website]{.underline}. You will also be able to join a
    drug plan at www.medicare.gov on the web using Medicare's online
    enrollment center.

-   [By calling 1-800-MEDICARE]{.underline}. You can join a drug plan by
    calling 1-800-MEDICARE (1-800-633-4227) and talking to a Medicare
    customer service representative. TTY users should call
    1-877-486-2048.

**[How do I pay for the coverage? Can it be deducted from my Social
Security or my retirement check?]{.underline}**

In general, there are three ways you can pay your Medicare drug plan
premiums:

-   You can give permission to the company that offers the Medicare drug
    plan you choose to deduct the premium automatically from your bank
    account, or

-   You can have your premium deducted every month from your Social
    Security benefits, similar to your premiums for Medicare Part B, or

-   You can pay the prescription drug plan directly for your premium by
    mailing them a check or money order each month.

**Cost and Coverage**

**[What is a formulary?]{.underline}**

A formulary is a list of specific drugs a Medicare drug plan will cover.
Plans must cover all types of drugs required by Medicare, but within
each type it can limit which specific drugs it will cover. It may also
charge different cost-sharing amounts for different drugs within a type
of drug.

**[Will my Medicare Prescription Drug Plan need to notify me if its list
of covered drugs (formulary) changes? Can this affect the
cost?]{.underline}**

Most plans will have a formulary, which is a list of drugs covered by
the plan. This list must always meet Medicare's requirements, but it can
change when plans get new information. Your plan must let you know at
least 60 days before a drug you use is removed from the list or if the
costs are changing.

**[Will some drugs still be covered under Part B?]{.underline}**

Yes. Medicare Part B will still cover drugs that it covers now (like
some cancer drugs) that are usually given out by a doctor in his or her
office. Drugs that are not covered under Part A or Part B will, in most
cases, be covered under Medicare prescription drug coverage.

**[Will Medicare drug plans cover drugs that treat mental
illness?]{.underline}**

Yes. Medicare drug plans will include drugs in all disease categories.
They must also have an appeals and exceptions process. That process must
include ways to help people who have trouble handling the process
themselves.

**[Will the drugs covered by Medicare drug plans meet the needs of both
seniors and people with disabilities?]{.underline}**

Yes. Medicare drug plans must cover drugs and/or categories of drugs
that are commonly used by seniors and people with disabilities.

**[Are Medicare drug plans allowed to cover benzodiazepines (like
sleeping pills)?]{.underline}**

A Medicare drug plan is required to offer standard prescription drug
coverage, and may choose to offer additional coverage. A standard plan
can't cover benzodiazepines. However, a Medicare drug plan may cover
benzodiazepines if it offers more than standard coverage. The premium
for these plans will most often be higher than for standard plans.

**[Are any drug categories not included in Medicare prescription drug
coverage?]{.underline}**

Yes. Certain drugs are excluded, which means they can't be provided as
part of standard Medicare prescription drug coverage. Some examples of
excluded drugs include benzodiazepines, barbiturates, drugs for weight
loss or gain, and drugs for relief of colds. However, except for
non-prescription over-the-counter drugs, a plan can choose to cover
excluded drugs if the plan offers more than standard coverage.
Non-prescription drugs can't be included. However, under certain
circumstances, they may be provided at no cost.

**[What if I need a drug that isn't on the formulary or is covered at a
higher cost?]{.underline}**

If you need a drug that is not on the covered drug list, or that is on
the list but you think it should be covered for a lower copayment, you
can do the following:

-   Contact the plan and ask for an exception. You will probably have to
    provide information from your doctor about why you need the drug
    your plan won't cover.

-   If your plan denies the exception, you can appeal. Your plan must
    give you information on how to appeal.

**[What happens if a drug covered by my Medicare drug plan is found to
be unsafe?]{.underline}**

If a drug is found to be unsafe, it will no longer be covered. You will
get a written notice from your plan of why the drug is no longer
covered, a list of other drugs that are the same type that may be used
in its place, and the expected cost. Talk to your doctor about what drug
you should take.

**[What happens if a drug I take stops being covered for a reason other
than safety?]{.underline}**

If a drug is no longer covered by your Medicare drug plan for non-safety
reasons, or if it is covered at a higher cost, your plan must let you
know 60 days before the change. If you don't get a 60-day notice, the
plan must let you get a 60-day supply when you get your next refill for
the previous cost.

**Effect on Current Drug Coverage**

**[How do I know if I have "full Medicaid coverage?"]{.underline}**

If Medicaid covers both your health care and your prescription drugs,
you have "full" Medicaid benefits.

**[I have both Medicare and full Medicaid coverage. Do I need to apply
for extra help to pay for Medicare prescription drug
coverage?]{.underline}**

No. Since you have both Medicare and full Medicaid coverage, you
automatically qualify for extra help and you don't need to apply.
Starting January 1, 2006, Medicare will cover your prescription drugs
instead of Medicaid, so you will need to be in a Medicare drug plan to
get your drug coverage. Between November 15, 2005 and December 31, 2005,
you can choose any drug plan that meets your needs. If you don't choose
a plan during this time, Medicare will enroll you in a plan effective
January 1, 2006 so you don't miss a day of coverage. In October,
Medicare will send you a letter to let you know what plan you'll be in
if you don't join one before December 31.

**[What if I don't want the plan that Medicare chooses for
me?]{.underline}**

If you don't want the plan that Medicare chooses, you can switch any
time to another plan that you prefer. Just call the new plan to find out
how to join. When you join the new plan your coverage under the old plan
will end automatically.

You can call 1-800-MEDICARE (1-800-633-4227) if you don't want Medicare
prescription drug coverage and you don't want Medicare to enroll you in
a plan. However, if you choose to do this, you could be left with no
prescription drug coverage as of January 1, 2006 because after that date
Medicaid will not pay for any drugs that would be covered under a
Medicare drug plan.

**[How often can I change plans?]{.underline}**

If you have Medicare and full Medicaid coverage, you can change plans at
any time. The change will be effective at the beginning of the next
month.

**[What if the prescription I take is not covered by my Medicare drug
plan? Will Medicaid still pay for it?]{.underline}**

If Medicare covers a prescription drug, Medicaid will not pay for it.
However, Medicare drug plans don't have to cover every drug that's
included in Medicare prescription drug coverage. They only have to cover
every type of drug. You should review what drugs are covered by the
Medicare drug plans available in your area and try to join one that
covers the same prescriptions you take now. If the plan doesn't cover
your exact prescriptions, it's required to have a transition period
where your current drugs may be covered for a certain length of time
while you work with your doctor to find an alternative prescription drug
to take that is covered by the plan. If your doctor believes you need to
take your current prescription drug and should not switch to a covered
prescription drug, you or your doctor can contact your plan and ask it
to give you an "exception" which means the plan agrees to pay for your
current drug. If the plan refuses to give you an exception, you can
appeal the plan's decision.

However, if you are currently stabilized on certain specific
prescription drugs (like drugs for depression, cancer or HIV/AIDS), you
don't have to switch to a different prescription drug. Please talk to
your doctor or pharmacist to see if your prescription drugs qualify.

When you join, the Medicare drug plan will send you information about
its appeal procedures. Read the information carefully and call your plan
if you have any questions.

**[What if Medicare doesn't cover my prescription at all? Will Medicaid
still pay for it?]{.underline}**

Some state Medicaid programs may choose to cover some or all of the few
prescriptions not covered by Medicare prescription drug coverage.
Contact your State Medical Assistance Office for more information.

**[If my prescription drugs are now paid for by my state Medicaid
program, can my state make me join a certain Medicare drug
plan?]{.underline}**

No. State Medicaid programs may provide you with information about
certain plans, but they can't make you join a specific plan.

**[If my prescription drugs are now paid for by my state Medicaid
program, will Medicaid still pay for drugs I take that aren't covered by
Medicare prescription drug coverage (such as sleeping pills or
prescription vitamins)?]{.underline}**

If the State covers that kind of drug for people who get Medicaid but
don't have Medicare, then Medicaid must still cover that drug for you.
You need to check with your state Medicaid program to see if it will
cover a drug not covered by Medicare.

**[If my drugs are now covered by my state Medicaid program, and I live
in a nursing home or other institution, will I need to join a Medicare
drug plan?]{.underline}**

Yes. Medicaid will no longer cover prescription drugs covered by
Medicare prescription drug coverage as of January 1, 2006. If you don't
join a Medicare drug plan by December 31, 2005, Medicare will
automatically enroll you in a Medicare drug plan. Your Medicare drug
coverage will start January 1, 2006. However, you can choose and join a
different plan at any time.

**[Do State Pharmacy Assistance Programs (SPAPs) have to work with all
Medicare drug plans offered in their states?]{.underline}**

Yes. SPAPs must provide assistance to people eligible for Medicare
prescription drug coverage regardless of which Medicare drug plan they
join.

**Information for People who have Limited Incomes and Resources**

**[If I am not certain whether or not I qualify, should I apply for
extra help?]{.underline}**

Yes, because there is no risk or cost to apply. And, if you qualify, you
will get extra help paying for the annual deductible, premiums, and
copayments for Medicare prescription drug coverage.

**[What information do I need to apply for the extra
help?]{.underline}**

You will need your Social Security number and financial information for
you and your spouse (if married and living together), including
information on deposits in bank accounts, income from pensions,
investments or annuities, and face value of life insurance policies to
complete the application. However, you should apply even if you think
you don't have all of this information.

**[How often do I need to apply for the extra help?]{.underline}**

Your eligibility will be reviewed every year to see if you still qualify
for extra help. If you do qualify, you don't need to reapply because the
review will be sent to you automatically. However, if, in any year we
tell you that you don't qualify, but you think you do, you will have to
reapply.

**[How much will my prescriptions cost me if I qualify for the extra
help?]{.underline}**

The amount of extra help you get is based on your income and resources.
If you automatically qualify for extra help, you will have continuous
drug coverage and only pay a small copayment for each prescription (up
to \$5). Look on pages 57-58 of your "Medicare & You 2006" handbook for
your costs if you apply and qualify for extra help.

**[Where can I get help with my application?]{.underline}**

A family member, friend, or a local volunteer counselor might be able to
help you with the application. You can also call the Social Security
Administration at 1-800-772-1213 (TTY users should call 1-800-325-0778),
or visit www.socialsecurity.gov on the web for more information.

[^1]: The participant list is attached at Appendix A

[^2]: The Medicare Prescription Drug, Improvement and Modernization Act
    of 2003 (Pub. L. 108-173), known, for short as the Medicare
    Modernization Act, or MMA, was signed into law by President Bush on
    December 8, 2003.  This landmark legislation provides seniors and
    individuals with disabilities with a prescription drug benefit, more
    choices, and better benefits under Medicare. Part D of that Act
    focuses on prescription drug benefits.