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Leslie Norwalk
Deputy Administrator for the Centers for Medicare & Medicaid Services (CMS)

April 14, 2006

Leslie Norwalk
Good afternoon, this is Leslie Norwalk, the Deputy Administrator of the Center for Medicare & Medicaid Services (CMS), the agency that oversees the Medicare program. I am pleased to be answering your questions today about the new Medicare prescription drug coverage.

Over forty years ago, Medicare was created to guarantee health care for seniors and people with disabilities. Since then, millions of Americans have appreciated the dependable health care coverage that Medicare has provided for treatment from doctors and hospitals when they get sick.

Since January 1, Medicare has offered voluntary prescription drug coverage to ALL Medicare beneficiaries (even those who have won the lottery!). Finally, seniors and people with disabilities are going to get help with up-to-date, life-enhancing prescription medicines. So far, 29.6 million people are benefiting from this coverage. While we’re happy so many have signed up, we realize there is more work to be done between now and May 15th.

It’s very straightforward to sign up for the new benefit, all you need to do is call 1-800 MEDICARE, and have a list of your prescriptions and your Medicare card on hand.

People with Medicare are selecting plans that best meet their needs. According to a recent Washington Post-ABC News poll, 75 percent of people with Medicare found it was to sign up and nearly two-thirds said the new program saved them money.

Joe, from Missoula writes:
Ms. Norwalk - What exactly has changed in Medicare? I heard the President speak about new options and benefits, but not sure what he means. Can you sum it?

Leslie Norwalk
Medicare always has provided coverage for doctor visits, hospital stays and life-saving surgeries. But now, Medicare is working to keep people healthy by covering new preventive screenings and offering prescription drug coverage.

Medicare prescription drug coverage is insurance that covers brand-name and generic drugs at participating pharmacies in your areas. Under the program, private companies offer drug plans that you have the option of joining. It’s a voluntary program that can help you save money on the prescriptions you need.

When you get Medicare prescription drug coverage, you pay part of the costs, and Medicare pays part of the costs. People with limited income and resources may qualify for extra help that can lower or even eliminate out-of-pocket costs for this coverage.

Each plan must meet a standard of coverage set by Medicare. However, plans can vary on which pharmacies they use, which drugs they cover and how much they charge. But all plans are required to cover all medically necessary treatments. Additionally, all plans cover nearly all of the drugs that are used to treat cancer, seizure disorders, HIV/AIDs, as well drugs taken after a transplant, anti-psychotics and anti-depressants. This is true regardless of the monthly premium.

If you call 1-800-MEDICARE with a list of your prescriptions and your Medicare card number in hard, our customer service representatives will help you find the plan that’s best for you. It’s that simple. Customer service representatives are available 24 hours a day, 7 days a week. If you sign up in April, your coverage will begin on May 1st.

Denise, from Baltimore County writes:
How are you going to get to or are getting to the Seniors that are located on the lower eastern shore or southern maryland who live in the rural areas. For example: the ones who live down the road a by the big oak tree, past the old barn that use to belong to Mr. White. A lot of seniors aren't able to get out to the local churches, senior centers, and don't have relatives, close friends, or computer access. How are you going to get to those folks?

Leslie Norwalk
The Centers for Medicare & Medicaid Services (CMS) has been working to reach seniors in rural areas through three main avenues including our Mobile Office Tour, local partnerships and 1-800- MEDICARE. The CMS Medicare Mobile Enrollment Center, which is a fully furnished office with internet connectivity and computer hardware, provides technical support at enrollment events and is used to help seniors in remote areas enroll. This Mobile Office Tour has traveled over 450,000 miles across the United States, conducting outreach and enrollment events in communities across the country. Of the more than 400 stops that the Medicare Mobile Enrollment Center has made, over 65% have been in rural areas. Most recently, the Mobile Office has visited rural areas in Missouri, Kansas, Montana, Wisconsin, South Dakota, and New England. Other destinations are currently being scheduled. The Medicare Mobile Enrollment Center will continue to visit rural areas and saturate rural media markets throughout the enrollment period.

CMS has also established more than 200 grassroots networks nationwide to encourage outreach collaboration between various stakeholders, including: the Social Security Administration (SSA), State Health Insurance Assistance Programs (SHIPs); Area Agencies on Aging (AAA), AARP, Medicare Today, local and state level health officials, and local non-profit groups. CMS conducted nearly 900 in-person training sessions, trained over 4,000 partners and participated in thousands and thousands of partner events since January 1, 2006. In addition:

  • 400,000 copies of training videos, training CDs, toolkits, resource kits and job aids have been distributed through the ten CMS regional offices located throughout the country.
  • 6 Medicare cable shows have been developed to educate beneficiaries. Copies of these cable shows have been distributed to thousands of pharmacists, to senior centers, and to over 200 local cable stations of which approximately 80% broadcast to predominantly rural areas.
  • CMS continues to work closely with the United States Department of Agriculture (USDA) to train Rural Development employees who in turn have been educating rural communities and reaching seniors in remote parts of the country.

Beneficiaries can get the help they need by calling 1-800-MEDICARE with a list of their prescriptions and their Medicare card number in hand. Medicare’s customer service representatives will help them find the plan that’s best for them based on their current drug needs and pharmacy preferences. It’s that simple. Customer service representatives are available 24 hours a day, 7 days a week. If they sign up in April, your coverage will begin on May 1st.

Finally, through 1-800-MEDICARE seniors in rural areas all across the country are able to get the latest information on the drug benefit and learn about what resources are available and closest to them. Beneficiaries who want face-to-face help – even when they live in rural areas – can call 1-800-MEDICARE and ask for information for the local SHIP (state health insurance assistance program). The SHIP can arrange for help in person, for beneficiaries who need it.

Wayne, from St. Helena, CA writes:
Why do we allow the general negative hype about the Medicare prescription program to continue unchallanged? My 85 year old mother was frightened by the reports about how diffecult and confusing it was to sign-up. When I finally visited the Medicare web page, I was amazed at how easy it was to navigate and find all the information I needed. She chose to sign-up for her choice by telephone but we could have done so on the Medicare web page just as easily. This is clearly a good program for seniors and Medicare has made it accessible

Leslie Norwalk
I agree, we think seniors can think for themselves. Your mother isn’t alone; here are a few examples of seniors who had a trouble-free experience enrolling and are enjoying savings on their prescription drug costs.

Sheila Hill: "So I calculated that for a three-month supply of two brand-name drugs, I only pay $88 plus premiums totaling $57.06. My three-month supply now costs me $145.06 instead of $492.27 from Canada. Annually, that comes to $580.24, saving me $1,388.84 per year, or $115.74 per month. What a deal! So, I signed up. The entire process from inquiry to sign-up took less than 20 minutes total. Medicare was knowledgeable, asked me specific questions, and then came up with the best choice." (Sheila Hill, Op-Ed, "Medicare Part D Sign-Up Was Simple," [Fort Lauderdale, FL] Sun-Sentinel, 3/19/06)

Jim Nelson, 79: "I'm really happy with it, and I don't know why people are not signing up already." (Melanie Markley, "Some Warm To Drug Program," The Houston Chronicle, 3/30/06)

People are reviewing their choices and selecting plans with different features. A vast majority of beneficiaries, nearly 85 percent, have selected a plan different than the one standard plan that Congress designed. About 80 percent of beneficiaries selected a plan with NO deductible. I know a number of you are concerned about the so-called coverage gap or donut hole. There are a number of plans available that have no gap in coverage. About 25 percent of enrollees chose such a plan, and many beneficiaries picked a plan with premiums under $20 a month.

The important thing is that beneficiaries weighed their options and selected a plan. I know that the process can seem overwhelming, but there is help available. Our customer service representatives are available around the clock to help you sort through your choices and enroll you in a plan. They’ll walk you through the process. There are some things to keep in mind when thinking about the plan that’s best for you: cost, coverage, convenience, and peace of mind. Some of these factors might be more significant to you than others depending on your situation and drug needs.

We have worked diligently to ensure the new Medicare prescription drug program enrollment process is as seamless as possible for people with Medicare. That is why we have 6,000 customer service representatives at 1-800-Medicare available 24 hours a day, 7 days a week to answer questions about what plan is right for them, based on the drugs they take, and the pharmacy they use.

Moreover, we've worked closely with the states and 14,000 partners to provide face-to-face help for people who want to narrow down the options to choose an insurance plan that makes the most sense for them. We also have a website,, for people who are comfortable with surfing the web for additional information. Drug Plan Compare does the math and compares the plans in California, for example, on the basis of the drugs that a beneficiary takes and includes any premiums, co-payments or deductibles that a beneficiary would be asked to pay. These are all important tools to help beneficiaries in whatever way they find most comfortable, over the phone, in person or on the web.

Kim, from Kentucky writes:
Hi Leslie, I am trying to help my mom sign up for the Prescription Drug Plan, and I was wondering if states vary in the type of coverage that is offered? Also, do companies like Aetna and AARP help with the Prescription Plan and if so, how? Thank You

Leslie Norwalk
Different prescription drug plans offer slightly different coverage. For example, in Kentucky, there are 25 plans with no deductible, one plan with a premium that is only $12.30, and 6 more with premiums under $25, and 7 plans that offer coverage in the gap.

People with Medicare are reviewing their choices and selecting plans with different features. Our customer service representatives are available around the clock to help you and your mom sort through her choices and enroll in a plan. They’ll walk you through the process. There are some things to keep in mind when thinking about the plan that’s best for her: cost, coverage, convenience, and peace of mind.

Cost: Plans may have a monthly premium, deductible or copayments, and may set a limit on what they will pay. So compare monthly premiums and determine copayments and yearly deductible. Plans will also discount the price of the drugs they cover. With Medicare’s new drug coverage, a typical person with Medicare, who has no prescription drug coverage today, will save about 50% on prescription drug costs.

Coverage: Medicare prescription drug coverage is insurance that covers both brand-name and generic prescription drugs at participating pharmacies in your area. Each plan has to provide access to medically necessary prescription drugs. Compare plans on how they meet your mom’s needs.

Convenience: Prescription drug plans contract with local pharmacies. Look for conveniently located pharmacies that participate in the Medicare prescription drug program. Also note that some plans offer prescriptions through the mail.

Peace of mind: Even if your mother does not take a lot of prescription drugs now, it’s still good to consider joining. As we age, most people need prescription drugs to stay healthy. Signing up for Medicare prescription drug coverage today can help protect her savings from high prescription drug costs often associated with major health problems such as heart disease and cancer. Should yearly out-of-pocket drug costs exceed $3,600, Medicare will pay up to 95% of the bill.

Some of these factors might be more significant to you than others depending on your situation and drug needs. But the most important thing to remember when you and your mom start looking for a plan is how easy it is. As I stated previously, it’s easy, all you need to do is call 1-800 MEDICARE, have a list of your mom’s prescriptions and her Medicare card on hand. Medicare “does the math,” and can tell you what plans are the least expensive for your mom. We can also tell you specific information about AARP and Aetna, and other companies that offer the drug benefit in Kentucky. We’ll help you find the right plan for your mom.

Cliff, from Brimfield, Ohio writes:
Adm. Norwalk: How many people have participated in the new drug program? And did the Administration have a projected number they expected to participate? Thank You and Happy Easter

Leslie Norwalk
Out of the 42 million people with Medicare, about 29.6 million are receiving help with the prescription drug costs thanks to the new Medicare prescription drug program. We have already reached our projected enrollment of 28 to 30 million people.

About 7.7 million people have enrolled in a stand-alone Medicare prescription drug plan. That means they opted to keep their Medicare A and B coverage they way it has always been while adding the new drug coverage – or Part D – to their benefit package.

An additional 5.7 million people are enrolled in a Medicare Advantage plan. These are health plans that cover doctor and hospital care as well as prescriptions. These plans usually provide lower costs if you use the doctors and hospitals that participate in the plans’ network. Many also provide extra benefits, like dental coverage or reduced premiums for their enrollees.

Medicare now provides drug coverage to people who used to get their drugs from Medicaid. Medicare has worked with the States to switch more than 5.7 million people from Medicaid to the new Medicare program where they will have no premiums, no deductibles, and no gap in coverage and pay very little or nothing for almost all their prescriptions.

Medicare also is helping employers or unions that offer retiree drug coverage. Provided the coverage offered meets Medicare’s standard, employers and unions can receive a subsidy from the government for continuing to provide coverage. About 6.8 million people are benefiting from this subsidy.

An additional 3.5 million people get their drug coverage through the military’s TriCare program or the Federal Employee’s Health Benefit Plan.

Finally, many other beneficiaries (not counted in the 29.6 million) have what we call “Creditable Coverage.” That means that they have drug coverage that is as good as, or better, than Medicare coverage. There are 3.2 million beneficiaries that receive prescriptions through the Veterans’ Administration. If they are happy with this coverage, they don’t need to make a change. In addition, 2 million beneficiaries are working and receive drug coverage through their current employers. They may sign up for the drug benefit when they retire, but don’t need to do anything now. A half a million other beneficiaries have retiree drug coverage through their former employer or union, but their employer or union has not applied for a Medicare retiree drug subsidy.

Thus, of the 42 million beneficiaries, over 35 million have Medicare drug coverage, or drug coverage that is as good as or better than Medicare’s. That means that we are spending the next month reaching out to the remaining 7 million beneficiaries, so they can decide what works for them before May 15th.

Remember, if you call 1-800-MEDICARE with a list of your prescriptions and your Medicare card number in hard, our customer service representatives will help you find the plan that’s best for you. It’s that simple. Customer service representatives are available 24 hours a day, 7 days a week.

Tony, from Phoenix, AZ writes:
I am employed, 65 yrs old. My wife is retired, 66 yrs. old and on Mecicare. She is presently on Medicare, part A and is currently covered by my employer's insurance. Should she still enroll in the Prescription drug coverage plan?

Leslie Norwalk
If she is covered under your insurance, and your employer has determined that their coverage is at least as good as Medicare's prescription drug coverage, she does not need to sign up until that coverage changes. At that time, she will be able to choose a drug plan with no late enrollment fees. She should have received a notice from your employer letting her know whether or not her coverage is at least as good as Medicare's. If she hasn’t, you can ask your employer. Finally, if you have additional questions, just call 1-800-Medicare, and they can walk you through the process.

Carter, from Chattanooga, TN writes:
I am eligible for the new Medicare part D program. However, it is still far cheaper for me to get my drugs in Canada even with the benefit. Why?

Leslie Norwalk
I understand that a number of seniors have relied on Canadian pharmacies for their prescriptions. However, our experience has shown that people with Medicare can save a considerable amount of money by enrolling in a Medicare drug plan. A recent AARP review found that people who choose the least expensive Medicare drug plan in their area that covers all their drugs could pay less this year than getting those same drugs from Canada.

I know that a number of websites tout the savings available from Canadian pharmacies. But some of these websites are based on the basic Medicare drug benefit that Congress designed in 2003. They do not consider the much better deals that many Medicare drug plans are actually offering this year.

I did some shopping myself to compare prices between those available at and the cheapest prescription drug plan available in zip code 45419, which is in the Dayton Ohio area. There’s quite a difference. I compared prices for Lipitor, Actonel, Advair, Celebrex, Diovan, Evista, Flomax, Fosamax, Glyburide/Metformin, Nexium, Norvasc, Plavix, Premarin, Prevacid, Singulair, Synthroid, and Zocor.

For Lipitor, I found a price of $164.15 for a ninety 10mg tablets on a popular Canadian pharmacy website. I could get the same drugs for $48.43 from the Medicare prescription drug plan.

I compared the annual price for all of these drugs on the Canadian website ($19,229) with the annual price for all of these drugs in the least expensive plan in Ohio ($4401.69) – saving nearly $15,000 using the Medicare Prescription Drug plan. Of course, no beneficiary will take all of these drugs, but the Medicare Prescription Drug program is likely to save you money, no matter where you live or what drugs you take.

And the Medicare Prescription Drug program will provide something that the Canadian pharmacies cannot: catastrophic coverage. If you need help with very high drug costs, only the Medicare Prescription Drug program will cover 95% of your costs after you spend $3600. You also should know that spending on drugs from Canada does not count toward the $3,600 out-of-pocket spending limit that triggers the very low-cost catastrophic coverage offered by the Medicare drug plans.

There are other drawbacks to relying on Canada pharmacies, even ones that are safe and reputable. It's still illegal under American law. Sometimes, deliveries are intercepted by U.S. authorities. By enrolling in a Medicare plan, you will have the peace of mind that you can get your medicines from your local pharmacies when you need them.

By calling 1-800-MEDICARE with a list of your prescriptions and your Medicare number, our customer service representatives will help you find and enroll in a drug plan that best meets your needs. It’s that simple and you are likely to find considerable savings like many others have.

tyler, from maine writes:
what is the medicare plan for senior citizens?

Leslie Norwalk
Medicare is a health insurance program for people age 65 or older, people under age 65 with certain disabilities, and people of all ages with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant).

Medicare has Part A (Hospital Insurance), Part B (Medical Insurance), and Part D (Prescription Drug Coverage).

Starting January 1, 2006, Medicare provides dependable prescription drug coverage that will make it easier for everyone with Medicare to pay for the drugs they need to stay healthy.

Medicare Part A (Hospital Insurance) helps cover your inpatient care in hospitals, including critical access hospitals, and skilled nursing facilities (not custodial or long-term care). It also helps cover hospice care and some home health care. You must meet certain conditions to get these benefits. Medicare Part B (Medical Insurance) helps cover your doctors’ services and outpatient care. It also covers some other medical services that Part A doesn’t cover, such as some of the services of physical and occupational therapists, and some home health care. Part B helps pay for these covered services and supplies when they are medically necessary. Medicare Part C is known as the “Medicare Advantage Program.” And Medicare Part D is the prescription drug coverage that has been the main topic of today’s discussion.

The Medicare and You Handbook describes each of these in greater detail. If you do not have this handbook, call 1-800-MEDICARE and ask that one be sent to you.

Leslie Norwalk
Thank you for your questions, and remember, you can always call 1-800-MEDICARE to get the information you need about the new Medicare prescription drug benefit, twenty-four hours a day, 7 days a week. Customer service representatives can answer your questions as well as give you the locations of counselors in your areas that can help you in-person on a one to one basis. We also have lots of information available on our website: Just remember, all you need is a list of your prescriptions and your Medicare card. Like I said before, it’s that simple.

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