4.  Can someone be enrolled in their employer retiree benefit plan with creditable" prescription drug coverage and still qualify for the low-income subsidy?  And how would the two work together if they do at all?
a.) Retiree health coverage and Part D: Yes, it is possible for an individual to be enrolled in both a retiree health insurance plan and a Part D plan.  It is, however, very important to understand exactly how a specific retiree plan will or will not work with Part D before deciding to enroll.  Some retiree plans, for example, may automatically drop those who enroll in Part D. Others may coordinate their benefits (in this latter case, Part D is the primary coverage, with the retiree coverage being secondary).  Thus, as Part D could have an adverse impact on the retiree coverage, the retiree should check with his/her company before enrolling in a Part D plan.

b.) LIS, Part D, and retiree health coverage: For those dual eligible individuals who have retiree coverage, it is important to understand the relationship between the automatic enrollment of full duals into Part D plans and that of the retiree health insurance. They need to ascertain whether they can retain their retiree health insurance, especially if that insurance offers comprehensive health coverage.  The worst outcome of auto enrollment for these individuals is being dropped from retiree coverage altogether (including health benefits) because they were automatically enrolled into a Part D plan. This is also an important issue for dual eligible beneficiaries who live in a long-term care facility and whose dependents receive their health coverage through the retiree plan as well. They must affirmatively decline the Part D auto-enrollment if their retiree plan does not permit them to keep their retiree coverage AND Part D. Individuals who age into Medicare or become eligible for Medicaid in 2006, or thereafter will also be automatically enrolled into Part D plans as appropriate. For those duals who already have coverage of prescription drugs through a retiree plan, it is likewise crucial to understand how that retiree plan will or will not coordinate with Part D.
c.) Coordination of retiree health insurance and Part D for low-income beneficiaries: As we’ve stated, it is possible to have a Part D plan, qualify for extra help, and be enrolled in a retiree plan at the same time if the retiree plan permits coordination with Part D. If the retiree plan will not allow coordination, then it is important for an individual to make a decision about which plan is most suited to her needs. If the retiree plan WILL permit coordination, and the individual qualifies for extra help, the out-of-pocket costs associated with the Part D plan will be minimal. If the individual is responsible for paying for a portion of the costs associated with the retiree plan, switching to a Part D plan might reduce the overall costs. However, if the individual does not pay for the costs associated with the retiree plan, then the individual might decide to be enrolled in both plans. It is important to note that, in this case, the Part D plan would be primary and the retiree plan would be secondary coverage. For more information about retiree coverage and Part D, CMS has created a Fact Sheet.

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