Con Edison: Retirees - benefits management

Read about Medicare Part D Prescription Drug Program

As you may be aware by now, the federal government is sponsoring a prescription drug program for Medicare eligible retirees. If you, your spouse, dependent child, and/or domestic partner are Medicare eligible, you may have already received information from Medicare about the new prescription drug program called "Medicare Part D." This letter will help you understand how Medicare Part D works and whether you may want to consider applying for the program. For most Con Edison retirees, the company's prescription drug plan will be less expensive.

Medicare Part D Prescription Drug Program – Effective January 1, 2006

The Medicare Part D drug benefit is optional unless you are receiving Medicaid. Before you decide whether or not to enroll in Medicare Part D, you should compare benefits under this program with those offered under the Con Edison Retiree Prescription Plan.

Enrollment for Medicare Part D begins November 1, 2005 and coverage starts in January 2006. As of the date of this letter, here's how the program will work in 2006:

There will be a monthly contribution of approximately $37 or $444 a year per individual.
There will also be a $250 annual deductible.
Once you have paid your $250 annual deductible, you will then pay 25% of the next $2,000 of your prescription drug costs. You will then have reached your "Initial Coverage Limit" of $2,250.
After you have reached the Initial Coverage Limit, you will have to pay 100% of the next $2,850 in prescription drug costs before Medicare Part D reimburses you for drug costs again. Medicare will then resume paying your prescription drug costs after you make the following co-payments:
- $2 for generic drugs that cost up to $40 per prescription, or
- $5 for brand named drugs that cost up to $100 per prescription, or
- 5% of the prescription cost when the generic drug cost is more than $40 or the brand named drug cost is more than $100.
When your total "out-of-pocket" costs reach $3,600, you pay 5% of the costs and Medicare pays 95% of the costs for the remainder of the year.

Medicare Part D for Low Income Individuals

There is a special program under Medicare Part D for low-income individuals who have an annual income below $14,355 for an individual or $19,245 for a family, and who have assets under $11,500 for an individual or under $23,000 for a family. Assets include checking and savings accounts, certificates of deposit, IRAs, 401(k), stocks, bonds, etc. Assets do not include your primary home, car, or certain property related to burial expenses. You can apply for these low-income benefits through the Social Security Administration or your State Medical Assistance Office. Social Security is mailing an application to those who may qualify for low-income benefits, or you can call 1-800-772-1213 for more information. If you qualify for Medicare's low-income benefits, it may be beneficial for you to join Medicare Part D and discontinue your prescription drug coverage under the Con Edison Retiree Health Program.

Effective January 1, 2006, if you currently receive your prescription drugs through Medicaid you will automatically be enrolled in Medicare Part D. Please fill out the form on page 3 if you receive prescription drugs through Medicaid and send it to Employee Benefits. Medicare will be sending you information this summer and in the fall regarding Medicaid coverage.

Con Edison Retiree Health Program

If you enroll in Medicare Part D, you cannot maintain your prescription drug coverage under the Con Edison Retiree Health Program. However, you can maintain your health coverage in the company's Retiree Health Plan, which will continue to supplement hospital and medical benefits offered under Medicare Parts A and B.

If you no longer wish to continue coverage under the prescription portion of the Retiree Health Program because you want to enroll in the new Medicare Part D program, fill out the form on page 3 and send it to Employee Benefits.

If you enroll in the Medicare Part D program, you may, during a future enrollment period, re-enroll in the prescription drug coverage of the Con Edison Retiree Health Plan provided you discontinue your Medicare Part D coverage. If you have any questions, please call Employee Benefits at 1-800-582-5056.

Download the letter and disenrollment form in PDF format