As part of the healthcare reform legislation passed in March, checks are being mailed beginning today (June 10, 2010) to people who receive Medicare, those who have already begun paying for their drugs through the donut hole. The only problem is - some of those folks are going to find that through their own actions, their money will be stolen.
Let's take a look at how that will happen, and how you can protect yourself from crooks and fraud.
What's the donut hole?
People who take very expensive drugs, or many different drugs, are consuming many thousands of dollars worth of pharmaceuticals each year. According to the law, these seniors pay the first $310 worth of drugs in the early part of the year (the deductible), then Medicare helps them pay for the next $2,520 worth of drugs. Once they hit that total cost of $2,830 (the deductible plus the $2,520) they become responsible for 100% of the cost of their drugs - no help from Medicare - until their total drug cost reaches $4,550. Once there, Medicare picks up the cost of the drugs they need for the rest of the year, minus a small co-pay.
That coverage gap - between the $2,830 point where Medicare stops paying anything, before it starts picking up part of the tab again at $4,550 - is called the doughnut hole.
So what is the check for?
It's a first step in helping to close that donut hole gap. Each year seniors will find efforts to help them close that gap until there is no more donut hole, per se, by the year 2020. Those checks begin going out this week.
Who will get a check?
Seniors who have already paid for pharmaceutical drugs in 2010 enough to move into the donut hole.
How can a senior apply to get that doughnut hole check?
They can't, they shouldn't - and they don't need to.
The government keeps track through its drug usage database of how much Medicare beneficiaries have already spent on their drugs, and as such, it knows exactly the point when the senior has reached the coverage gap. Once a senior has reached the donut hole, the government will send them the check.
So how can the money be stolen?
Seniors have long been the target of crooks and frauds. This is one more way seniors may be scammed. Here are some of the ways this may happen, and suggestions about how to prevent the crime:
- Phone calls: A crook calls the senior and offers to help them apply for the $250 check (no application is needed - hang up!)
- Phone calls and home visits: A crook calls the senior or shows up at the door and asks them to provide information in order to "verify they will be eligible" to receive their check. Seniors may be providing social security numbers, bank account numbers, etc - which can result in bogus bank transactions or identity theft. (no one will ask you for information - hang up or close the door!)
- Internet pop up ads may appear at some websites: They will invite someone to click on them to find the application for their rebate check. (ignore them or close the window)
No doubt there are additional ways scammers will think of to relieve seniors of the money due to them. If you are a senior, please know that you will automatically receive your check at the right time, and there is no information you need to provide, nothing you need to do to get it.
If you have a senior in your life and you fear they may fall prey to a swindler, then raise this possibility in conversation, and suggest that if they get a call, or someone comes to their door, that they just say NO -- or that they give you a call to help them sort out the confusion.
What to do if you or the senior in your life is contacted by someone asking for this information
You can report this fraud to Medicare / the Department of Health and Human Services at 1-800-MEDICARE or online at www.stopmedicarefraud.gov .
• Learn more about the rebate checks and the donut hole from Dr. Michael Bihari, About.com's Guide to Health Insurance
• Learn more about how The Affordable Care Act (healthcare reform) will affect senior citizens.
• Learn more about the kinds of healthcare related fraud and how we become victims
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Much needed information for Seniors AND for caretakers!
I first found out about the ‘donut hole’ last November when my Mother’s medications were suddenly not covered and I was sent hundreds of dollars in uncovered prescription charges from her Assisted Living residence. It was only when I called Medicare that I was told that Medicare has a cut off when it comes to prescriptions. Thank you for bringing this to everyone’s attention and it’s good news that there is now some reimbursement for this gap in coverage.
Disgusting stuff, isn’t it? Every time the government tries to undo past errors in treating seniors, someone finds a way to turn it into a scam for robbing our grandparents. I know it’s uncouth, but it really makes me want to beat the crap out of someone.