Policy Update

Transitional Coverage Under Medicare Drug Benefit Expires

Enrollees in Medicare's new drug program could be experiencing another wave of problems, after the March 31 expiration of special protections that have allowed beneficiaries to stay on their existing medication regimens even if their new plans don't cover their drugs. The private insurance plans administering Medicare's drug benefit initially agreed to offer a 30-day transition period to cover all necessary drugs. Medicare officials later requested they extend that period to 90 days, through the end of March. That transition period ended March 31.

About 40 states, including California, stepped in to provide emergency stopgap relief for Medicare beneficiaries. Medi-Cal (California's Medicaid program), encouraged beneficiaries to obtain a 100-day supply of their drugs before the end of last year in case the new program didn't cover their drugs. Beneficiaries who got three-month supplies at the end of 2005 were expected to run out by early April. Only 17 states are still filling prescriptions under stopgap measures.

Advocates warn that consumers getting their drugs filled through emergency measures may not realize they need to change plans or go through an exceptions process in order to continue receiving their prescriptions. Meanwhile, the state's emergency plan to cover the cost of medications for indigent and disabled beneficiaries was extended to April 16. California has filled more than 675,000 prescriptions for Medicare beneficiaries also on Medi-Cal at a cost of $45.4 million, and the federal government has announced it will stop reimbursing states for emergency drug costs as of March 31. Read More

Claiming a Parent as a Dependent for Tax Purposes

As we close another busy tax season, caregivers are advised to plan ahead for next year. An article in the Seattle Post-Intelligencer offers tips for claiming a parent as a dependent to receive federal tax savings. When claiming an older parent as a dependent, the parent's income cannot exceed a $3,200 exemption amount and the tax filer must be able to prove that he or she is responsible for at least 50 percent of the parent's expenses (which includes lodging, utilities, food, clothing and medical costs over and above what Medicare and supplemental Medigap insurance covers). The article also notes that dependency can be rotated among siblings from year to year, depending on which one benefits most. Read More

How Secure Is Women's Retirement Income?

The U.S. Senate Special Committee on Aging recently held a hearing on retirement income disparity for women. Senators Herb Kohl and Gordon Smith made statements about the increased likelihood of women having smaller retirement incomes, while Senator Kohl offered policy proposals to address this problem, such as tax incentives for businesses to hire and retain older workers and tax credits to family caregivers who have taken time off to care for loved ones. Other experts from research and advocacy organizations also gave testimony supporting policies to improve financial security for women. Read More

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