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Medicare Discount Card Update: Prices Vary, Confusion Reigns

  • May 3rd, 2004

Starting Monday, May 3, Medicare beneficiaries can sign up for one of the many Medicare discount cards being offered in their area. Surveys show that millions of beneficiaries are not yet aware of the new benefit, and confusion is reigning among many of those who have. Recently ElderLawAnswers published an article that explains the discount card program. To read it, click here.

Since that article first appeared, the Centers for Medicare and Medicaid Services (CMS), which administers the Medicare program, has taken a few steps to make it easier for Medicare beneficiaries to sign up for the cards and to compare them.

First, CMS has decided to issue a standard enrollment form. Previously, beneficiaries could sign up only by using one of the forms supplied by the card sellers. The standard form will make it easier for community-based organizations, health professionals, and consumer groups to assist beneficiaries with the enrollment process. (However, the card-sponsor forms may still be used to enroll.) The standard form is available on the Medicare Web site, www.medicare.gov

Second, Medicare will allow state pharmacy assistance programs, in certain circumstances, to enroll low-income Medicare beneficiaries in the card program. States that have the authority to act as an "authorized representative" of a beneficiary (as defined by state law) will be permitted to enroll beneficiaries in drug cards on the beneficiary's behalf. This step will make it easier for low-income beneficiaries in states with pharmacy assistance programs to get $600 in additional help.

Third, consumers can now compare the drug prices offered by different card sponsors on the Medicare Web site. The site revealed wide variation in prices for scores of prescription drugs listed. In some cases, the prices available with the new Medicare cards were higher than those charged by online pharmacies or Canadian drugstores, or prices available to federal employees. However, after the prices were put up on the site, sponsors of drug discount cards claimed many of the prices were wildly inaccurate.

The Medicare Rights Center, a consumer advocacy group, recently tested the site and found it "incomplete, imprecise and at times misleading." For example, the site fails to disclose drug discount options other than the Medicare-approved drug discount cards, or whether buying a Medicare-approved drug discount card will affect other drug coverage a beneficiary might have. "[T]he site does not warn people that choosing a Medicare-approved card might impede access to other coverage," the Center says.

Beware Drug Card Fraud

At least 17 states have already reported scams involving the new cards. Con artists are selling fake discount cards, often in order to obtain private information from beneficiaries that could be used to file false claims.

CMS is warning Medicare beneficiaries and their family members to be cautious when approached to buy a drug discount card. If a card provider pressures you into making a quick decision, that's a tip-off that it's a scam. Medicare beneficiaries may sign up for the cards at any time until the card program ends and the Medicare prescription drug benefit begins January 1, 2006. (In fact, it's a wise move to take your time so you can select the card that will save you the most on your prescriptions.) In addition, any card that costs more than $30 a year is bogus.

Look for the Medicare-approved seal on the card authenticating that it is a 'Medicare-approved' card (although this is no guarantee, since scam artists may be copying the seal).

In addition, CMS says that beneficiaries should NEVER share personal information such as their bank account number, Social Security number or health insurance card number (or Medicare number) with any individual who calls or comes to the door claiming to sell ANY Medicare-related product. If fraud is suspected, the beneficiary should call 1-800-MEDICARE, the OIG Fraud Hotline at 1-800-447-8477 or a local law enforcement agency (such as the police).

Confusion Reigns

Meanwhile, questions of whether to use the legitimate cards and, if so, which one to choose are proving hard enough for many older Americans to answer.

"Far from embracing the discount cards, many seniors are reacting with befuddlement, skepticism or hostility," says the Seattle Times, which ran a particularly informative group of articles on the cards. "Details of the discount program are so bewildering, or unavailable, that most seniors have yet to figure out whether they'd benefit at all, insurance experts and seniors say."

In an amusing column on the new Medicare benefit in the Hartford Courant, Jim Shea writes: "The discount card company you join is under no restriction to maintain the price that enticed you to join in the first place. In fact, it doesn't even have to guarantee it will continue to carry the drugs you need. In private business this practice is known as bait and switch. In Republican-controlled Washington these days, it is known as a benefit."

For a New York Times article comparing the discount card drug prices found on the Medicare Web site, go to: http://www.nytimes.com/2004/04/30/politics/30DRUG.html

For a Times article on inaccurate drug prices on the Web site, go to: http://www.nytimes.com/2004/05/01/politics/01DRUG.html(Free registration required and articles may no longer be available free of charge.)

Local Elder Law Attorneys in Ashburn, VA

Loretta Williams

Hale Ball Carlson Baumgartner Murphy PLC
Fairfax, VA

Mindy Felinton

Felinton Elder Law & Estate Planning Centers
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Ron Landsman

Ron M. Landsman, P.A.
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Last Modified: 05/03/2004

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