OVERVIEW OF ACT

• The Medicare Prescription Improvement and Modernization Act of 2003 (MMA) was signcd into law December 2003.

• Most significant change to Medicare since inception in 1965.

• Over the next 10 years $700 billion in improvements.

• The final regulations were published in January 2005.

PROVISIONS OF ACT

• Created Medicare Part D

• New Medicare Preventive Benefits

- Blood screening for early detection of cardiovascular disease

- Diabetes Screening

- Vaccinations

- Cancer Screening

- Bone Mass Measurements

• Part B Deductible will be tied to CPI (Consumer Price Index)

• Starting in 2007, income-related Part B Premium

- Decrease in the subsidy for higher annual incomes

- Under $80,000 , 75% subsidy (remains same as today)

$80,000 to $100,000 at 65% subsidy

100,000 to 150,000 at 50%

150,000 to 200,000 at 35%

Over 200,000 at 20%

MEDICARE PART D

Private Insurance Companies will administer Part D. Enrollees will pay monthly premiums on average ol $37. This premium will be in addition to the monthly premiums ol Part A and / or Part B you may be paying. Members may pay for Part D either through their Social Security Check or directly to the carrier.

Initial enrollment for current medicare members is November 15, 2005 through May 15, 2006.

For people becoming eligible for medicare in March of 2006 or later enrollment of Part D is the same as Part H.

Annual enrollment in 2007 and subsequent years -November 15 through December 31.

PART D PENALTIES

Late Enrollmenl Penally

* 1% ot base premium per month ifvou DO NOT enroll during the initial enrollment period.

PART D BENEFITS

Government Standard Medicare Prescription Drug Plan is as follows:

• $250 calendar year deductible,

• Enrollees pay 25% of prescription drug costs from $251 to $2,000 ($500).

• Enrollees pay 100% ol Prescription drug costs from $2,251 to $5,100 ($2,850).

• Enrollees pay 5% of prescription drug cost over $5,100 or $2 gentries or $5 lor brand, whichever is greater.

• At least two drugs per therapeutic category and class.

• Some companies will enhance die benefits. Consider looking for a company that oilers enhanced Fart D plans to best suit your needs.

Example: your costs 2006