4 New Benefits for Medicare Recipients

Retirees are already using new services in large numbers.

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The Centers for Medicare and Medicaid Services mailed $250 rebate checks totaling nearly $1 billion to almost 3.8 million Medicare recipients with high prescription drug costs in 2010. Medicare Part D recipients who spent more than $2,830 out-of-pocket were automatically mailed the one-time payments provided to seniors by The Affordable Care Act.

[See 10 Ways to Boost Your Social Security Checks.]

Seniors in California, Florida, New York, Pennsylvania, and Texas were the most likely to receive checks and cashed then within an average of 15 days of being issued. Retirees will get an even bigger break on their routine medical costs this year. Here’s a look at some of the new benefits Medicare recipients are already beginning to take advantage of.

Half price brand name drugs. The Medicare Part D coverage gap begins when a senior has spent $2,830 on medications and lasts until catastrophic coverage kicks in after a patient has spent $4,550 on prescription drugs. Prior to 2010, seniors had to pay the full cost of their prescriptions while they were in this donut hole gap. However, seniors who reach the donut hole in 2011 will get a 50 percent discount on brand name drugs. As of Feb. 28, 2011, 47,718 Medicare beneficiaries have received the discount, saving an average of about $800 each over the 2-month period. Beneficiary out-of-pocket costs have been collectively reduced by $38 million so far this year. Millions more retirees are expected to benefit from the discount as their out-of-pocket spending on drugs accrues over the course of the year. Also, the drug discount doesn’t impact how long seniors will spend in the donut hole. Although retirees pay half price for brand name drugs, the entire drug cost counts toward the amount they need to qualify for catastrophic coverage.

[Visit the U.S. News Retirement site for more planning ideas and advice.]

Generic medication discount. Medicare began paying 7 percent of the price for generic drugs during the coverage gap in 2011. The amount that qualifies an enrollee for catastrophic coverage in Medicare Part D will be gradually reduced in future years until the donut hole is completely eliminated in 2020. Closing the Medicare doughnut hole is one of the most popular aspects of the health reform bill. A Kaiser Family Foundation survey of 1,202 adults conducted this month found that over three quarters (76 percent) support ending the coverage gap in Medicare Part D.

Free wellness visit. For the first time in 2011, Medicare recipients will not be charged any out-of-pocket costs for an annual wellness visit. Some 151,764 beneficiaries received a free physical between Jan. 1 and Feb. 23, 2011. New Medicare recipients will also be eligible for a one-time free physical exam within the first 12 months they have Part B coverage by a doctor who agrees to be paid directly by Medicare.

[See 4 Social Security Changes Coming in 2011.]

Free preventative care. A variety of preventative care services are now free for Medicare recipients including cancer screenings such as mammograms and colonoscopies. Prior to 2011, seniors had to pay for 20 percent of the cost for many preventative tests, and some services, such as bone mass measurements, were also subject to the annual deductable of $155 in 2010. The 20 percent cost sharing on a colorectal cancer screening, for example, cost some retirees as much as $160 in 2010. Other services now available with no deductable or copayment include diabetes screenings, cholesterol and cardiovascular screenings, and flu shots.

Twitter: @aiming2retire