Medicare Discount Cards From Hell?

Beginning next week, Medicare participants can begin using a prescription-drug discount card designed to help anyone over 65 save money on medication.

While many need the discount, seniors looking into the program have discovered that there are 73 different cards to choose from. And finding the best one is no easy task.

To sort through the confusion, financial advisor Ray Martin visits The Early Show on Wednesday to explain how to go about choosing a card.

In December 2003, Congress passed the Medicare Prescription Drug Improvement and Modernization Act. A major goal of the act is to provide prescription drug coverage for seniors. The law does not kick into effect until January 2006. However, the government wanted to provide some sort of immediate financial assistance for seniors who face large monthly costs for medications. The answer: prescription drug discount cards.

Anyone eligible for Medicare can apply for a card immediately. You do not automatically receive one; you have to apply. Here are the basics on the cards:

• Effective June 1
  
• Provide discounts of 10% - 25%
  
• Cost $30 or less

Even though it is being hailed as a significant benefit by lawmakers and Medicare's top officials, seniors are skeptical and angry, according to reports from across the country. The rules surrounding these discount cards are confusing and restrictive - so much so that advocates fear many people who could be helped by the cards won't even sign up for one.

So what's so confusing?

First of all, there's not just one discount card. There are 73 different cards approved by Medicare but offered by a variety of insurance companies, HMOs, pharmaceutical companies and others who routinely administer prescription drug benefits. Some cards are available nationwide, while others only work in certain states or at particular pharmacies. All of the cards offer different discounts on different medications. To make matters worse, the companies can change which drugs they offer and the discounts they offer on the drugs at any time without any warning to cardholders.

While companies can make as many changes as they wish, seniors have to choose one card and stick with it until the end of the year. Come December,, they can decide to renew their current card or get a different card for 2005.

"If an individual is taking three medications, but the drugs and associated discounts are not all offered on any one card, individuals are not permitted to get several of the Medicare-approved drug cards that collectively could provide discounts for all of their medications," Martin says.

The average American over age 65 takes an average of six prescription drugs. It's completely possible that a senior searching for the perfect discount card will not find a card that offers a discount on each of his six prescriptions. It's almost a guarantee that comparing the discounts he can receive will be extremely difficult and frustrating.

All of this raises the question for many seniors: is it worth my time to research a discount card that I'm only going to use for 19 months? Just how helpful is this program?

Well, if you are a Medicare-eligible senior who spends money on medications each month then yes, you should look into the possibility of saving money.

But, if you receive retiree benefits from an employer or a union, if you belong to a state drug-discount program, or buy your drugs from Canada, there is small chance that the Medicare discounts will be better. In other words, signing up for a Medicare discount card probably won't save you much, if any, money on your medications.

Yet there is no question that the discount cards benefit lower income seniors - particularly if those who qualify for the $600 annual credit.

If you already receive a drug discount from your pharmacy, from the state, from a senior group or other source, you CAN also sign up for a Medicare-approved discount card. You can just have ONE Medicare-approved card.

Here are Martin's tips for choosing the best drug discount card for you.

List Your Drugs and Costs - Make a list of the drugs you take and how much they cost. Rank them from highest out-of-pocket cost to lowest.

Find Cards Through Medicare - Contact Medicare to find out which discount cards are available in your state and get information on each one. Ideally, get this info from the Web: www.medicare.gov. You can call 1-800-MEDICARE, but many callers report waiting for more than 20 minutes to speak to anyone, or receiving a recorded message that all lines are full.

Compare Card Benefits- Compare all available discount cards, looking for the one that covers most of your medications, or covers your most expensive medication. Also, make sure that you save enough to cover the initial cost of the discount card.

Call Company Offering Discounts - Each card/company has a toll-free number associated with it. Call this number and verify that the drugs and discounts are actually offered by the company. There have been numerous reports that information on the Medicare Web site is wrong or already outdated.

Apply For Card - If you find a card that works for you, you will need to get an application from the company so that you can enroll.

A word of caution: Many folks who are eligible for these cards are receiving promotional materials for specific cards. Make sure that any card you choose has the Medicare-approved logo. There already have been several instances of scams - people promoting official-looking cards that are not actually a part of the program.