What could they have been thinking in Washington, when Congress crafted and the President signed the new Medicare Prescription Drug Plan (aka Medicare Part D)? If it turns out that they were on drugs, we won't be surprised.

The promise - that Medicare would pay about half the drug costs for seniors - is certainly a step in the right direction, but the program couldn't be more confusing and complicated. Still, seniors who can navigate the Part D maze can save a substantial sum, not just in 2006, but for the rest of their lives. Yet many aren't 'Net savvy, which we think you really need to be, to make the most of the program.

Be the Solution!
If you're reading this, chances are, you or someone else in your family can help loved ones figure out which of the 40 or more available plans makes the most sense for them.

Our favorite octogenarian, who we'll call Rose, is sharp as a tack but asked for our help because she’s not ‘Net and spreadsheet savvy. So they don't need to ask, volunteer now to help navigate Medicare's drug plans for your mom, dad, grandma, grandpa, aunts, uncles, etc.! The sooner you do it, the more they'll save.

Like many seniors, Rose had no drug coverage - but she swallows about $3,600 worth of pills a year. The new drug plan can save her money - but if she makes a bad choice, her annual drug costs could easily increase by thousands of dollars. This is no joke!

Based on where she lives, Rose can choose between a mere 46 separate Medicare drug plans, plus some HMO-type options. With the least expensive plan available to her, she would pay just over $1,000 a year for her insurance premium plus her drugs. On the other hand, the most expensive plan would drain more than $4,500 from her nest egg – almost $1,000 more than she’s currently paying, without drug coverage!

Rose was thinking about signing up for an AARP plan. Many folks think AARP’s only concern is the welfare of retirees, so it'd design the best, most cost effective plans. Many seniors will punt by signing up for an AARP Part D option, which you might think is better than nothing. In Rose's case, choosing AARP's plan would be a very costly mistake – as of this writing. (See below.)

There’s No One Size Fits All
Unfortunately, no one plan is going to be best for everyone – or even everyone who has, say, high blood pressure and lives in Cleveland. There are way too many variables. For example, in Rose’s area, monthly premiums vary from about $4 a month to $80 a month or more. Deductibles range from $0 to $250, and the co-pays vary by company and by drug.

Most important: Each plan contains its own “formulary” - a list of drugs that are covered, some in limited quantities. If your specific meds aren’t on the list, you won’t be insured for them. If your drugs are on the list, you’ll need to keep your fingers crossed that they won’t be removed, which the insurers can do after giving notice.

Finally, and lest we forget, no one has a crystal ball, and can predict what medications someone will be on, say, some 5 months from now. Still, having a Medicare Drug Plan can certainly be way better than no drug plan ... if you choose carefully.

Doughnut Holes May Be Dangerous to Your (Financial) Health
In general, once their out of pocket expenses reach $2,251, seniors will pay the full cost of all drugs - until their total out of pocket cost reaches $3,600. Fortunately for those with pricey prescriptions, some plans will fill the hole. In any case, once that $3,600 is reached, catastrophic coverage kicks in, and about 95% of drug costs are covered (with some exceptions).

However, to further complicate matters, “Medicare advantage” plans (i.e., HMOs), some “Medigap” plans, and some private insurance plans (e.g., through a former employer) include drug coverage – often, better coverage than is available through the Medicare drug plans. So it's important to ask about these options. Also, there are new subsidies for those who are entitled.

Punch a Few Keys for Someone You Love
While choosing between the drug plans would confuse most mere mortals, the same government that dreamt this all up, does offer something of a helping hand in the guise of a Web site - www.medicare.gov. But if the eligible folks we know are any indication, they'll still need help sorting through the options. The only way to make sure your loved ones benefit as much as possible from Medicare Part D is to invest a little time and help them figure it out.

The sooner you do it, the more they’ll save. Folks who sign up by December 31, 2005, will start benefiting from the Medicare Drug Plan on January 1, 2006. Folks who don’t sign up by May 15, 2006 will face a monthly penalty - plus they will have lost the benefit of drug coverage for the first half of 2006. After that, the next sign up period is between November 15, 2006 and December 31, 2006, with coverage beginning January 1, 2007.

Chances are, during the next couple of weeks, you will either see or speak to all the people in your life who may be eligible for Medicare’s Drug Plan. It won’t take much of your time to help them look at their alternatives. And just think, you'll be the Holiday Hero who saved them a bundle.

To find out which plan is best, you'll need a list of all their meds, including doses and monthly quantities, plus the name of their preferred pharmacies, some time, and a bit of patience for the process. Go to www.medicare.gov, where you can plug in the info and compare the alternatives.

While you can call 800-MEDICARE (800-633-4227) and give the list of prescription medications to someone who will talk you through the options and answer your questions ... we think this is too complicated for a phone call. It’s best if a computer savvy family member or friend takes on the project, calling the 800 number with specific questions, only. The couple of times we called with specific questions, we promptly received helpful answers, but a friend who called about something more general got conflicting information.

When we went to Medicare’s site to help Rose look at her alternatives, it seemed pretty easy to plug in the drugs and dosages she currently uses and the drug store she patronizes. (You can also put in mail-order suppliers.) But the answers we came up with were surprising. The AARP plan, which has no deductible, would leave her with an annual drug cost of almost $2,500, while Humana's standard el cheapo plan, even after paying the $250 deductible, would save her $1,450 a year!

Seemed pretty straight-forward, and we were pleased with ourselves ... until we double-checked, a few days later. This time, Medicare.gov came up with very different figures.

Oy! Now What to Do?!
The difference might be due to a glitch or two on the Medicare site – and/or to competition between insurers – and of course, we could have easily changed a variable or two without realizing it.

Since everything can change between now and the end of 2005, the best bet might be to enter in the meds and look over the options now, and sign up for the best plan - but don’t think of your choice as final until even closer to the New Year. By then, the glitches are likely to have been worked out and the jockeying amongst insurers will be over, at least for the initial sign-up period. By the way, between now and December 31st, seniors can change their minds about insurers as often as they'd like. (From January 1, 2006 through mid-May, they can change once with no consequences.)

Don't wait until the 31st to take a look. Check Medicare.gov now, and then again before month's end. Since we’d be worried that it may be difficult to find someone at Medicare to help with last minute questions ... or that the site would crash on New Year’s Eve day, which is a Saturday ... we'll probably shoot for the 29th of December as the day to help Rose make a final decision. That way she won't miss a day of coverage and she's likely to get the best buy.

Not quite Medicare Eligible?
No worries. “Newbies” have seven months, starting 90 days before they hit the big 65 to figure out which plan to choose. That’s something nice to look forward to, huh?