CEC Post-Enrollment and Renewals 3 — Questions and Answers
Question 1: A beneficiary enrolled in a Medicare Part D plan reaches the catastrophic coverage phase. What happens to their cost-sharing at this stage?
- They pay 100% of drug costs until the end of the year
- They pay a small copay or coinsurance and the plan covers the rest (Correct answer)
- They are disenrolled and must reapply
- They must switch to a different formulary tier
Correct answer: They pay a small copay or coinsurance and the plan covers the rest
In the catastrophic coverage phase, beneficiaries pay significantly reduced cost-sharing (small copay or 5% coinsurance) and the plan covers the majority of drug costs.
Question 2: An enrollment counselor's client asks about the Medicare Savings Programs. Which statement is accurate?
- They are federal programs that help low-income beneficiaries pay Medicare premiums and cost-sharing (Correct answer)
- They are employer-sponsored plans that supplement Medicare coverage
- They are available only to beneficiaries under age 65 with disabilities
- They replace Medicaid for Medicare-eligible individuals
Correct answer: They are federal programs that help low-income beneficiaries pay Medicare premiums and cost-sharing
Medicare Savings Programs are state-administered, federally funded programs that assist low-income beneficiaries with Medicare Part A and/or Part B premiums, deductibles, and copayments.
Question 3: What is the primary purpose of the Low-Income Subsidy (LIS/Extra Help) program in relation to Medicare Part D?
- To eliminate the need for a Part D plan entirely
- To help low-income beneficiaries pay for Part D premiums, deductibles, and copayments (Correct answer)
- To provide free prescription drugs through a federal pharmacy
- To automatically enroll beneficiaries in the most expensive Part D plan
Correct answer: To help low-income beneficiaries pay for Part D premiums, deductibles, and copayments
The Low-Income Subsidy (Extra Help) assists qualifying low-income beneficiaries by reducing or eliminating Part D premiums, deductibles, and copayments.
Question 4: A beneficiary who receives Extra Help is auto-enrolled into a benchmark plan. What happens if they do not make a plan selection?
- They lose their Extra Help benefit
- They remain enrolled in the assigned benchmark plan (Correct answer)
- They are automatically enrolled in Original Medicare only
- They must pay full Part D premiums until they choose a plan
Correct answer: They remain enrolled in the assigned benchmark plan
Beneficiaries auto-enrolled into a benchmark Part D plan remain in that plan if they take no action, and their Extra Help subsidy continues.
Question 5: A client asks why they received a late enrollment penalty for Part D. Which scenario would result in this penalty?
- They enrolled in Part D during their Initial Enrollment Period
- They went 63 or more consecutive days without creditable prescription drug coverage (Correct answer)
- They enrolled in a Medicare Advantage plan with drug coverage
- They had employer drug coverage deemed creditable by their employer
Correct answer: They went 63 or more consecutive days without creditable prescription drug coverage
A Part D late enrollment penalty applies when a beneficiary goes 63 or more consecutive days without creditable prescription drug coverage after their enrollment window closes.
Question 6: Which of the following best describes a 'formulary exception' in a Medicare Part D plan?
- A request to change the plan's premium structure
- A request for the plan to cover a drug not on the formulary or at a lower cost-sharing tier (Correct answer)
- A request to disenroll from the plan without penalty
- A request for a different network pharmacy to be covered
Correct answer: A request for the plan to cover a drug not on the formulary or at a lower cost-sharing tier
A formulary exception is a request for the plan to cover a non-formulary drug or place a drug on a lower cost-sharing tier when the standard formulary does not meet the beneficiary's medical needs.
Question 7: After a beneficiary enrolls in a new Medicare Advantage plan, when does the new coverage typically begin?
- Immediately upon submission of the enrollment application
- The first day of the month following the month of enrollment, if all conditions are met (Correct answer)
- 60 days after the enrollment application is approved
- At the start of the next calendar year regardless of enrollment date
Correct answer: The first day of the month following the month of enrollment, if all conditions are met
Medicare Advantage enrollment generally becomes effective the first day of the month following the month of enrollment, assuming the beneficiary has Medicare Parts A and B.
CEC Post-Enrollment and Renewals 3
A beneficiary enrolled in a Medicare Part D plan reaches the catastrophic coverage phase.
What happens to their cost-sharing at this stage?