AFT retirees help mark 70th anniversary of
Social Security

Aug. 14 marked the 70th anniversary of the signing of the Social Security Act by President Franklin Delano Roosevelt. Retirees used the occasion to celebrate and to highlight the fight to save the program from President George Bush’s plan to establish private accounts using Social Security’s cash surplus. AFT retirees from Florida, Wisconsin and other states attended events held nationwide, including activities sponsored by Americans United to Protect Social Security, a coalition of labor, senior, community and activist organizations, that is  backed by the AFT.

In New York, more than 500 active and retired members of the New York State United Teachers (NYSUT), the United Federation of Teachers and the New York State Alliance for Retired Americans gathered at the historic Hyde Park, N.Y., home of President Roosevelt on Aug.13, to highlight the union’s campaign to protect Social Security.

“Social Security is the most successful program in the history of our nation,” said AFT vice president and NYSUT vice president Kathleen Donahue. “For 70 years, tens of millions of Americans—seniors, children whose parents are deceased, and disabled Americans—have relied on Social Security. We need to repair the problems without wrecking the program.”

AFT vice president and NYSUT executive vice president Alan Lubin and New York Alliance president Fred Nauman were also in attendance.

In Washington, D.C., opponents of privatization, joined by FDR’s grandson James Roosevelt Jr., rallied in front of the FDR memorial on Aug. 14. “Americans deserve to look forward to a retirement of financial stability rather than relying on a system of risky private accounts that raid the Social Security Trust Fund. Unfortunately, many in Washington have forgotten these basic principles,” Roosevelt told the crowd.

In the meantime, proponents of the White House plan to privatize Social Security are still moving forward. Rep. Jim McCrery (R-La.) has introduced a bill, H.R. 3304, that would use the temporary surplus in Social Security payroll taxes to pay for private accounts. These new accounts would last a little more than 10 years, when the surplus runs out. Privatization proponents are expected to push to make the accounts permanent once the surplus is exhausted.

Understanding the new Medicare prescription drug coverage

By now, most Americans are aware that Medicare’s new prescription drug plan, typically referred to as Medicare Part D, will start Jan. 1, 2006. To help you evaluate your choices and learn how this new program may affect you, the AFT has compiled answers to frequently asked questions.

It helps to understand that the Part D prescription drug program will work differently than Medicare; drug benefits won’t be provided directly by Medicare. Instead, to get Part D coverage, you must choose a plan from a private company or entity that has been approved by Medicare to offer a Part D plan in your area.

To be eligible for coverage, you generally must be covered by Medicare Part A and/or Part B. You are eligible for Part A and B if you are over age 65 and if you or your spouse worked and paid Medicare taxes for at least 10 years. You also are eligible if you have received Social Security disability benefits for two or more years, or if you have end-stage renal disease, a type of kidney disease.

Even if you don’t have Social Security coverage, you are eligible for Part D if you have purchased Part A or Part B benefits. You will pay a separate premium for the Medicare Part D coverage. The monthly premium for standard coverage will be about $32 in 2006 or $384 for the year, but the cost will vary by geographic location. In many situations, you will not need both Part D and drug coverage under a health plan. You should choose one or the other if possible.

Finally, if you decide Part D is right for you, you need to contact Medicare. Enrollment is not automatic. For more information on the new Medicare prescription drug plan, visit www.medicarerights.org/aboutmrcframeset.html.

FREQUENTLY ASKED QUESTIONS

What information do I need to compare prescription drug plans?

You should make a list of the names of the drugs you now take and the dosage, your monthly premium for coverage, your co-pays or co-insurance amounts, the actual cost of the drug and how many times you refill the prescription each year.

What should I consider when I compare prescription drug plans?

You should make sure the pharmacy you use is in the plan you are considering and that the drugs you take are covered. If there is a formulary (list of covered drugs), see if the drugs you take are on the formulary because that usually will reduce your costs. Then compare the Part D plans you are considering and your plan’s premiums, deductibles, co-pays and co-insurance amounts.

What about other prescription drug coverage I have?

If you already have coverage through your former employer, your state, your pension system, TriCare, Veterans Affairs or the Federal Employee Health Benefits Program, compare the drugs on the formulary, the co-pay or co-insurance amounts, and the premium under that plan with the Part D plan(s) you are considering. Also check with your local union or plan representative to see if your plan is making any changes for 2006. Many drug plans provided by employers, unions, states, pension systems and the federal government provide more complete coverage than Part D will provide.

Note: If you have a Medicare supplement policy that has drug benefits, you may not purchase Part D unless you change your Medicare supplement policy to a medical-only benefit. Note also that most Medicare supplement policies with drug coverage provide less complete coverage than Part D coverage.

When can I sign up for Part D coverage?

You can enroll in Part D between Nov. 15, 2005, and May 15, 2006. If you enroll between Nov. 15 and Dec. 31, your Part D coverage will start on Jan. 1, 2006. If you enroll between Jan. 1 and May 15, 2006, your Part D coverage will start on the first day of the month following the month in which you enrolled.

How often can I change Part D plans?

Once a year from Nov. 15 to Dec. 31. Coverage will begin on the following Jan. 1. You will be asked to switch Part D plans during the year if you move out of the service area of your Part D plan.

What happens if I don’t sign up for a Part D plan during the enrollment period?

If you have no drug coverage or coverage that is less complete than Medicare Part D offers, you will be exposed to a penalty of 1 percent per month for every month after May 2006 that you are not enrolled in Part D. Once you do enroll in Part D, this penalty will be imposed on every monthly premium you pay for as long as you stay in a Part D plan. For example, if you do not enroll for Part D until May 2008 (24 months late), you will pay a 24 percent penalty on each month’s premium as long as you are in a Part D plan. However, there is a very important exception to this penalty. If you have drug coverage provided by your union, former employer, a state system or a federal plan that is at least as good as Part D coverage, you will not pay the penalty if you choose to enroll later. This type of comparable coverage is known as “creditable coverage.” If you later lose or drop this coverage or it is reduced below the Part D standard, you will have six months from the date your coverage ends or the benefit is reduced to sign up for Part D without penalty. By Nov. 15, your plan must send you a notice stating whether or not your current coverage is creditable.

What drugs will the Part D plan cover?

Each plan must cover the same categories of drugs but may choose different drugs to cover within that category. Part D plans also may include different drugs on their formulary. (Drugs included on the formulary usually will cost less than drugs not on the formulary.) No Part D plan will be required to cover drugs used for cosmetic purposes, hair growth or infertility, inpatient drugs or those administered in a hospital or doctor’s office (because these are typically covered by Part A or Part B), sleeping pills, prescription vitamins or nonprescription drugs.

What can I do if a drug I am taking is removed from the formulary?

You may request a “formulary exception” from the plan if your doctor believes it is medically necessary for you to receive that particular drug.

If I don’t have other drug coverage, should I choose Part D coverage?

If you have no drug coverage at all, you most likely should choose Part D even if you take few or no drugs now, simply because it will insure you against catastrophic drug needs. It also will save you from paying a penalty if you later decide you want Part D coverage.

If I have other drug coverage, should I take both that coverage and Part D coverage?

In almost all cases, if the other coverage is “creditable,” the answer is No. Coverage in addition to Part D will increase the amount you personally must pay (called the “true out-of-pocket,” or “TROOP”) before the catastrophic Part D benefit applies, so in most cases the benefit you would receive from double coverage will not exceed the premiums you will have to pay for both. However, if your other plan is providing coverage that is not “creditable,” you probably should purchase Part D. In that case, you may want to drop your other coverage unless your employer, union or government plan advises you to purchase Part D and indicates that it is providing coverage that “wraps around” Part D.

What happens if I choose a Part D plan and then want to go back to an employer, union, state or federal plan?

This will vary from plan to plan. Check with your union, former employer or state or federal plan to see if you can return without penalty. Some plans may not allow you to re-enroll once you have dropped coverage.

Can I drop Medicare Part D and then get back in?

Yes, but you will have to pay the 1 percent monthly penalty if you go without having either Part D or creditable coverage for 63 or more days. You also will have to wait to re-enroll until the next enrollment period.