Employer Group Waiver Plan (EGWP) FAQ



Communication Questions

General Questions

Eligibility and Enrollment Questions

Pre-Authorization and Appeals Questions

Information for High Income Earners


EGWP: An opportunity for AlaskaCare to maintain existing pharmacy benefits for Medicare-eligible retirees and achieve cost savings for years to come.

Effective January 1, 2019, AlaskaCare implemented an enhanced Employer Group Waiver Program for all Medicare-eligible members covered under the AlaskaCare retiree health plan. An Employer Group Waiver Program, known as an EGWP or “Egg Whip,” is a program offered by the federal government that increases federal subsidies for prescription drugs for the retiree health trust. This was an administrative change to how pharmacy benefits were perviously managed for Medicare-eligible retirees and dependents. The pharmacy benefit for AlaskaCare retirees remains the same.

AlaskaCare was already receiving a federal subsidy for the retiree health prescription drug benefit. Moving to an enhanced EGWP plan means the retiree health trust will receive significantly higher subsidies than we did last year, saving the trust up to $20 million annually and providing $40-$60 million each year in additional State savings through a reduction in the unfunded liability. The Division must manage the health plan to ensure retirees can access their earned benefits throughout the entire course of their life, and an AlaskaCare EGWP allows the State to keep existing pharmacy benefits for Medicare-eligible retirees and beneficiaries, while increasing federal reimbursement of existing costs, reducing the State’s direct costs for these benefits in the long-term.

More than 90% of states that provide drug benefits to Medicare retirees have already implemented EGWPs. As Alaska, along with the rest of the U.S., faces rising health care costs, EGWPs are a proven win-win for maintaining high quality coverage for today’s and tomorrow’s Alaska retirees.

An AlaskaCare EGWP is just one way the Division is looking to reduce the cost of health care while maintaining or improving benefits for retirees. As part of the ongoing retiree health plan modernization project, the Division is evaluating adding benefits like preventive care, enhanced travel, and removing the lifetime maximum. Our goal is to improve, protect, and sustain the health plan as it continues to offer high quality benefits for current and future generations of retirees. Click for more information about the modernization project.

If you have questions or concerns about EGWPs, we want to hear from you!

You may contact the Division of Retirement and Benefits at:

Alaska Department of Administration
Division of Retirement and Benefits
P.O. Box 110203
Juneau, AK 99811-0203

You can also send comments via email to doa.drb.benefits@alaska.gov or reach the Division by phone toll-free at (800) 821-2251 or in Juneau at (907) 465-4460.

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Communication Questions

  1. When can I expect to receive my new ID card?
  2. Welcome kits with information and ID cards were mailed the week of December 3, 2018. The welcome kit included ID cards, plan information, and other resources to help members.

  3. Can I submit paper claims for my prescription benefits? Who should I send 2018 claims to if they haven’t been filed prior to January 1st?
  4. For all prescriptions filled prior to January 1, 2019, you should submit your claim to Aetna/CVS. For any prescription filled on or after January 1, 2019, you should submit your claim to OptumRx. You can find claim forms here.

  5. I am receiving letters and phone calls from OptumRx, asking for personal information. Is this a scam?
  6. You may receive letters or a phone call from OptumRx or their subcontractor, Convey, asking to confirm certain personal information, including: your name, address, birthday, and Medicare Beneficiary Identifier. Providing this information assists with expedited enrollment and helps avoid any potential issues related to discrepancies or errors between the health plan and Medicare. This is not a scam. If you need to provide updated information, you will receive reminder letters as follows:

    • First letter – upon enrollment in EGWP
    • Second letter – 30 days after enrollment
    • Third letter – 6 months after enrollment
    • Fourth letter – 12 months after enrollment. The fourth letter will be the final request to provide updated information.

    To provide this information, you can call the toll-free number provided in the letter, (855) 235-1405 (TTY 711), or mail the return form to:

    OptumRx
    Attention: Enrollment Services
    P.O. Box 269027
    Fort Lauderdale, FL 33326

    If you have provided updated information but receive an additional reminder letter asking for the information, it is possible that the reminder letter had already been mailed out when Convey received your response to the first letter. To verify that your accurate physical address is on file, you can call Convey toll-free at (855) 235-1405 (TTY 711), or you can contact the Division by phone toll-free at (800) 821-2251 or in Juneau at (907) 465-4460.

  7. Can I opt out of the pharmacy benefit transition to OptumRx and stay with Aetna?
  8. No. You cannot opt out of the transition from Aetna to OptumRx for pharmacy claims administration. All AlaskaCare members were transitioned to OptumRx effective January 1, 2019.

  9. I received a letter from OptumRx telling me I must opt out within 21 days. What if I need more time to make this decision?
  10. Members received a letter from OptumRx dated November 15, 2018, stating they had 21 days to opt-out of the enhanced Employer Group Waiver Program (EGWP). This was not a hard deadline. Members may elect to opt out of the enhanced EGWP at any time. However, to help ensure you did not experience any disruption in your service on January 1, 2019, members were encouraged to submit their opt-out elections no later than December 26, 2018.

    Remember: if you opt out of the enhanced EGWP you will be enrolled in a plan that is much different than the benefits offered today. This will result in increased out-of-pocket expenses for you or your Medicare-eligible dependents.

  11. Can I opt out over the phone?
  12. Yes. Please call the OptumRx member services at (855) 235-1405 to opt out over the phone. This number is only for the opt-out election. Any other questions should be referred to the main OptumRx number at (855) 409-6999.

    Remember: if you opt out of the enhanced EGWP you will be enrolled in a plan that is much different than the benefits offered today. This will result in increased out-of-pocket expenses for you or your Medicare-eligible dependents.

  13. Who should I call to confirm if I should have received an opt-out letter?
  14. Please call the OptumRx member services at (855) 409-6999 for additional information on why you were sent an opt-out letter.

  15. I received a letter from my other Medicare prescription drug plan, saying I have been disenrolled due to my participation in the AlaskaCare enhanced EGWP. What do I do?
  16. You cannot be enrolled in more than one EGWP at a time. If you are already covered under an EGWP through a non-AlaskaCare plan, please contact the Division. We can dis-enroll you from the AlaskaCare EGWP and leave you in the plan available to non-Medicare-eligible members. You will receive a letter from AlaskaCare confirming that you have been removed from the AlaskaCare enhanced EGWP. Please share this letter with your other Medicare prescription drug plan.

  17. What if I or my spouse are currently enrolled in a Medicare Advantage plan?
  18. You cannot be enrolled in Medicare Advantage plan that includes prescription drug coverage and a separate EGWP plan at the same time. We anticipate that this situation will be rare, but if you are covered under a Medicare Advantage plan that includes prescription drug coverage, please provide the Division with a letter or copy of your Medicare Advantage card and we will disenroll you from the AlaskaCare EGWP. If you are disenrolled from the AlaskaCare EGWP, you will continue to receive pharmacy benefits through the standard AlaskaCare pharmacy benefit.

  19. Will the Part D Income Related Monthly Adjustment Amount (IRMAA) surcharge deducted in January for my December 2018 benefit be reimbursed by AlaskaCare?
  20. Yes. The Part D surcharge deducted in January 2019 can be reimbursed through the Health Reimbursement Arrangement (HRA) account. Please make sure you have provided a copy of the letter from Social Security that outlines your IRMAA surcharge amount to the Division of Retirement and Benefits. You can mail a copy of the notice to:

    Alaska Department of Administration
    Division of Retirement and Benefits
    P.O. Box 110203
    Juneau, AK 99811-0203

    You may also send a copy via email to doa.drb.irmaa@alaska.gov or fax to (907) 465-3086.

  21. I currently have an individual Part D plan and qualify for low-income subsidies (LIS). Will I need to reapply for the LIS assistance, once I am enrolled in the AlaskaCare enhanced EGWP?
  22. No, you will not need to reapply for the LIS. Your LIS cost sharing/copays will remain the same.

  23. What is the Late Enrollment Penalty (LEP)?
  24. The Late Enrollment Penalty is an amount added to the Medicare Part D plan premium for a member who meets one or both of the following criteria:

    1. The member did not obtain creditable prescription drug (Rx) coverage when they were first eligible for Medicare Part D
    2. The member had a break in creditable prescription drug (Rx) coverage of at least 63 consecutive days.
    Note: The LEP, once assessed, remains with the member for the life of their participation in Medicare Part D.

  25. What if I get a Late Enrollment Penalty (LEP) Letter? Will I have to pay the fee?
  26. No, AlaskaCare will pay the Late Enrollment Penalty fee on behalf of the members. You are receiving a LEP letter since you were identified by the Centers for Medicare & Medicaid Services (CMS or Medicare) as having uncovered months prior to their enrollment into the Medicare Part D plan.

    You may have had a LEP already in place under your former Medicare Part D plan.

  27. What can be done to remove the LEP?
  28. You can remove a LEP in the following ways:

    1. You can call Convey, the OptumRx Enrollment Vendor, at (855) 235-0294 and speak to an agent who will explain process to remove the LEP.
    2. You can complete the Declaration of Prior Creditable Coverage form included with the LEP letter and mail it to the following address:
      Convey Health Solutions
      P.O. Box 269027
      Fort Lauderdale, FL 33326
    There is a limited amount of time to correct a LEP notice if you feel this has been applied in error. You can contact Convey for up to 90 days after receiving notification to complete an attestation and have the LEP removed.

  29. I have received an Evidence of Coverage letter from OptumRx. This letter references an Initial Coverage Stage. What does this mean?
  30. Initial Coverage State is a term used by Medicare and is part of the Medicare mandatory information sent to all Medicare prescription drug plan participants. However, due to the additional benefits provided through the AlaskaCare enhanced EGWP, this does not apply and will not impact your benefits. Your copay will not change.

  31. I received a formulary in the mail from OptumRx and my medication is not listed. Will my medication still be covered?
  32. Yes, medications that were covered in 2018 will continue to be covered after January 1, 2019. The AlaskaCare plan has what is called an “open formulary.” This means the AlaskaCare plan will cover medications, even if those medications would typically not be covered under a Medicare prescription drug plan.

    AlaskaCare is required by the federal Center for Medicare and Medicaid Services (CMS) to send a document called an “abridged formulary” to members in the AlaskaCare enhanced EGWP. This formulary provides a list of medications covered under Medicare Part D. Under the AlaskaCare enhanced EGWP, medications that are not typically covered under Medicare Part D will still be covered through the wrap benefit under the AlaskaCare enhanced EGWP. This means that your medication will remain covered even if it is not on the formulary.

  33. I received a letter from OptumRx telling me I will pay more for my medication. I thought there were no changes to our benefits?
  34. This letter was sent to Defined Benefit retirees in error. There are no changes to your benefit. Your cost will continue to be the $4 copay for generic, $8 copay for brand name medications, and $0 copay for mail order prescriptions. OptumRx sent out a follow up letter to notice you of the error.

  35. I received a letter from OptumRx telling me there will be a new limit on how much of my medication will be covered. I thought there were no changes to our benefits?
  36. This letter was sent to Defined Benefit retirees in error. There are no changes to your benefit. With the exception of some controlled substances, you will have the ability to fill up to a 90-day supply of your medication. OptumRx sent out a follow-up letter to notify you of the error.

  37. I received a letter from OptumRx telling me I am taking a medication that will require prior authorization to determine if it is covered. I thought there were no changes to our benefits?
  38. This letter was sent to Defined Benefit retirees in error. There are no changes to your benefit. Although for some Medicare-eligible retirees there are some medications that require prior authorization, these letters reference additional prior authorization or quantity limits that do not apply to the AlaskaCare retiree health plan. OptumRx sent out a follow-up letter to notify you of the error.

  39. How can I tell if the Prior Authorization letter I received is accurate or not?
  40. If you are Medicare-eligible and are taking a medication that requires prior-authorization, you will receive a copy of the letter below. If you receive a letter referencing prior authorization that does not look like this, you may have received it in error. You can contact OptumRx at (855) 409-6999, TTY711 if you have questions about your prescriptions or any correspondence you have received from them.

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General Questions

  1. Why did the State change to an EGWP?
  2. Moving to an EGWP will have minimal impact to the membership and existing plan, while making providing pharmacy benefits more affordable and sustainable for the health trust and the State. EGWP is estimated to save the health plan approximately $20 million per year and between $40 to $60 million more annually to the State with no diminishment and minimal impact to the membership and existing plan.

    EGWP is one method offered by the federal government to provide subsidies to the State of Alaska retiree health trusts. The subsidies help the State keep the health plan funding healthy without impacting most members. We already have a federal reimbursement plan in place called a Retiree Drug Subsidy program (RDS), but EGWP provides greater returns.

    Many large employers have made the move from RDS to EGWP because of the significant cost savings and the ability to match existing benefits. Implementing an EGWP means that retirees and beneficiaries who are eligible for Medicare will have the same level and access to pharmacy benefits as they do now, while making more federal funds available to cover those costs. The savings helps the State fulfill its promise to provide retirement benefits to our AlaskaCare retirees.

  3. What is an “enhanced” EGWP?
  4. An enhanced EGWP, like the AlaskaCare EGWP, is a plan that includes medications covered under Medicare Part D, as well as any medications currently covered under the AlaskaCare retiree health plan that are not typically covered under Medicare. This ensures that all prescription drugs which are covered under the AlaskaCare plan today will be covered under the AlaskaCare EGWP. This enhanced coverage is also called a “wrap.”

  5. How does an EGWP work?
  6. Much the same way the plan works today. When a member goes to a pharmacy, they will present their AlaskaCare pharmacy ID card. The pharmacy will submit the claim. If the prescription is covered by Medicare, it will be covered by EGWP. Members will pay their normal copay ($0 mail order; $4 generic; $8 brand-name) and collect their medication. If the prescription is not covered by Medicare, it will automatically bill to the “wrap” plan. The member will pay their same copay and collect their medication. Either way, the member shouldn’t notice a difference.

    In the beginning, members may need to get prior authorizations for certain medications. A list of those medications is available on the AlaskaCare OptumRx information web page. If you are currently taking a medication that requires prior authorization, you will be contacted with information on what forms you or your doctor need to complete.

  7. How am I enrolled in EGWP? Will I need to sign up for Medicare Part D?
  8. If you are currently eligible for Medicare, or when you become eligible for Medicare, you will be automatically enrolled in the AlaskaCare EGWP plan (a group Medicare Part D plan) by the Division of Retirement and Benefits. You do not need to enroll in an individual Medicare Part D plan.

  9. Who is the Pharmacy Benefit Manager for AlaskaCare plans?
  10. Beginning January 1, 2019 OptumRx became the AlaskaCare pharmacy benefits manager. Aetna’s, with their subcontractor CVS/Caremark, pharmacy contract ended December 31, 2018. The Division and the PBM mailed out welcome kits with information, including ID cards, beginning the first week of December 2018.

  11. Why did the Pharmacy Benefit Manager change?
  12. Periodically, the Division competitively bids these contracts through a Request for Proposal (RFP). This gives the Division an opportunity to seek better service at lower cost for members and the plan. The previous procurement process resulted in OptumRx being selected to provide Pharmacy Benefit Management (PBM) services beginning January 1, 2019. Aetna’s, with their subcontractor CVS/Caremark, contract ended on December 31, 2018

  13. Is there a separate Pharmacy Benefit Manager for the AlaskaCare EGWP?
  14. No. There is one Pharmacy Benefit Manager (PBM) for all AlaskaCare prescription drug plans, including the AlaskaCare EGWP, OptumRx.

  15. Are any other health benefits affected by this change?
  16. No, this transition to an enhanced EGWP only impacts pharmacy benefits for Medicare-eligible retirees and dependents. The pharmacy plan for non-Medicare eligible retirees will remain the same. The transition to OptumRx as the new pharmacy benefit manager will apply to all AlaskaCare members, but only for pharmacy benefits; Aetna will remain the third-party administrator for all medical benefits. The supplemental health benefit plans will also remain the same. Aetna was the pharmacy benefits manager until the transition to OptumRx effective January 1, 2019.

  17. Why did the State change pharmacy benefits for Medicare-eligible retirees?
  18. Alaska law already requires that for Alaska retirees and beneficiaries, Medicare become the primary coverage for major benefits once they are Medicare-eligible. As a Medicare Part D plan, an EGWP would follow this same statutory requirement. By implementing an enhanced EGWP, like the proposed AlaskaCare EGWP (which covers some medications that are not currently covered under Medicare Part D), the benefits will remain the same as those in place today.

  19. Are vaccines covered under the AlaskaCare EGWP?
  20. Yes, beginning January 1, 2019. As a group Medicare Part D plan, the AlaskaCare EGWP covers most vaccines if they are administered at a pharmacy. They may also be covered when received in a doctor’s office, but only if the doctor’s office coordinates with a pharmacy to bill the plan for the entire cost of the vaccination, including the injection of the vaccine. This coverage will extend to all retirees as of that date, including retirees who are not Medicare-eligible and are therefore not enrolled in the enhanced EGWP.

    Generally, Medicare Part D covers all commercially-available shots needed to prevent illness. Common vaccines include shingles, diphtheria, tetanus, measles-mumps-rubella, polio, hepatitis A & B, and HPV. Please note that flu and pneumococcal shots are typically covered by Medicare Part B, and therefore will not be covered by the AlaskaCare plan. You can find a complete list of covered vaccines in the formulary on the AlaskaCare OptumRx information web page. Each vaccine is listed in the formulary as “viral vaccine” under the therapeutic drug class.

  21. Are vaccines covered for my dependents that aren’t eligible for Medicare?
  22. Yes. AlaskaCare is extending these same benefits to non-Medicare eligible retiree and dependents.

  23. I heard EGWP isn’t constitutionally protected. Does that mean this plan isn’t protected either?
  24. No! As an AlaskaCare member, your health benefits are protected, and it’s the Division’s job to ensure those benefits remain protected and sustained. Although the EGWP is not protected under Alaska’’s constitution, your retiree benefits are. Using an enhanced EGWP and covering additional medications that are not covered by a standalone EGWP will ensure that you continue to receive the same level of benefits consistent with the protections in the Alaska Constitution.

  25. Can the State leave EGWP if it is not performing as expected or if the federal government defunds or significantly changes the program?
  26. Yes. The Division will be closely monitoring the program and will evaluate whether it is in Alaska’s best interest to continue using this type of program. If the Division determines that it is not meeting the needs of our members or the State, the Division can disenroll.

    Like all Medicare programs, EGWP could change if federal laws and regulations change. Regardless of what happens in the future, Alaska has an obligation to provide pharmacy benefits and will continue to do so.

  27. Why is it beneficial to the federal government to subsidize pharmacy benefit for retirees?
  28. The Centers for Medicare and Medicaid Services (CMS) is interested in preserving pharmacy benefits for retirees and in providing an incentive to states or other large employers to continue providing these benefits to retirees. While Alaska will not discontinue retiree pharmacy benefits, this is a concern in many other states and for other large employers with retiree health plans. If retiree drug plans are discontinued, more people will enroll in Medicare Part D, which would mean the federal government shoulders more of the cost. Subsidizing state and employer plans encourages those plans to provide retiree drug benefits and is in everyone’s interest.

  29. If I am enrolled in an AlaskaCare EGWP will this reduce my prescription drug coverage?
  30. No, the prescription drugs covered under the current plan and the AlaskaCare EGWP will be the same.

  31. Will my prescriptions cost more because of this change?
  32. No. There will be no change in pharmacy copays.

  33. Will this change require me to use a different pharmacy or doctor?
  34. No. There will be minimal, if any, impact for our members. Just like today, an AlaskaCare EGWP uses a pharmacy network, which most of Alaska’s pharmacies participate in. OptumRx has been working directly with out-of-network pharmacies utilized by AlaskaCare members to bring them into the network. If your preferred pharmacy declines to join this network, you will be provided information about other options.

  35. Will my co-pays be higher under the enhanced EGWP?
  36. No. Pharmacy co-payments will not change.

  37. What are the “Donut Hole” (Coverage Gap) Stage and the Catastrophic Coverage Stage? Will I be subject to this under the enhanced EGWP?
  38. Although these are terms you may hear associated with an EGWP, these stages will not impact your benefits. They are different stages defined by Medicare based on your total drug costs. The “donut hole” policy for coverage of pharmacy benefits is a feature of some Medicare Part D plans, but the design of the AlaskaCare enhanced EGWP ensure that you will not be directly impacted by a coverage gap, because the State covers the pharmacy costs not covered under Medicare Part D. This extra coverage ensures your out-of-pocket costs for drugs will not change.

  39. I am Medicare-eligible and have multiple insurance coverages; does my enrollment in the AlaskaCare enhanced Employer Group Waiver Program (EGWP) change the coordination between my plans?
  40. Because the AlaskaCare enhanced EGWP is a group Medicare Part D plan, if you have multiple prescription drug coverages the AlaskaCare enhanced EGWP will become the primary payer. If your other coverage previously had been the primary payer, it will move into the secondary payer position. Your total coverage levels will not change. Your medications will still be covered at the same benefit level as they were before.

    Please note that you can only receive mail-order prescriptions through your primary prescription drug coverage’s home delivery program. If AlaskaCare is now your primary coverage and you used to receive mail-order prescriptions through an alternate coverage, you will need to enroll in the AlaskaCare prescription home delivery program to continue to receive your medications by mail.

    OptumRx provides the mail-order pharmacy for the AlaskaCare plans. Please visit Optumrx.com or contact OptumRx at (855) 409-6999 to enroll in prescription home delivery. If you receive your medication through OptumRx home delivery, your copay is $0, which may be less than the copay assessed by your other coverage.

    Please note that you cannot be enrolled in more than one EGWP at a time. We anticipate that this situation will be rare, but if you are already covered under an EGWP through a non-AlaskaCare plan, please provide the Division with a copy of your ID card from the other EGWP plan. We will disenroll you from the AlaskaCare EGWP but will you will continue to receive standard AlaskaCare pharmacy benefits.

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Eligibility and Enrollment Questions

  1. What if I become eligible for Medicare after January 1, 2019?
  2. You can expect to receive information from Medicare three months prior to turning age 65, and though you should enroll in Medicare Part A and B, you do not need to enroll in an individual Medicare Part D plan. You will be automatically enrolled in the AlaskaCare EGWP by the State.

  3. Will I be charged a Medicare Part D premium when enrolled in an enhanced EGWP?
  4. In most cases, no. The AlaskaCare retiree plan, through Optum Rx, will enroll eligible retirees into the AlaskaCare EGWP. AlaskaCare will pay a monthly administrative cost to the PBM for each enrolled member, and most retirees and their Medicare-eligible dependents will not be required to pay a premium to Medicare.

    CMS does require a premium payment of high-income individuals who are eligible for Medicare. See Question #1 of the high income earners section below for more information about this situation and whether it may impact your household.

  5. I am not Medicare-eligible, but my spouse is. Will he/she be enrolled in the enhanced EGWP plan?
  6. Yes. If your spouse is eligible for Medicare and you are not, he/she will be enrolled in the AlaskaCare EGWP plan, while your coverage will continue to be provided the same way it is today.

  7. What if I am eligible for Medicare, but my spouse or other dependents are not yet Medicare-eligible?
  8. If your dependents are not currently Medicare-eligible, they will continue to receive prescription drug benefits the same way they do today. If one of your dependents becomes eligible for Medicare in the future, he or she would be enrolled in the AlaskaCare EGWP at that time.

  9. OptumRx told me that I won’t be enrolled in the enhanced EGWP until February 1, 2019. Will I still have pharmacy benefits during January 2019?
  10. Some Medicare-eligible AlaskaCare retirees may experience a delayed enrollment in the enhanced EGWP until OptumRx can confirm and reconcile that member’s personal information with Medicare. Affected individuals will not experience a disruption in coverage; they will continue to receive full pharmacy benefits through the standard AlaskaCare pharmacy benefit until their enrollment in the AlaskaCare enhanced EGWP can be properly processed. For more information about your specific situation, please contact OptumRx member services at (855) 409-6999.

  11. I have more than one AlaskaCare coverage and don’t have a co-pay because my prescription costs are covered at 100 percent. Will this change?
  12. No. If you are covered under two or more AlaskaCare plans and are not required to pay a co-pay today, there will be no change under the AlaskaCare EGWP.

  13. What if I or my spouse are currently enrolled in an EGWP through another employer?
  14. You cannot be enrolled in more than one EGWP at a time. We anticipate that this situation will be rare, but if you are already covered under an EGWP through a non-AlaskaCare plan, please provide the Division with a copy of your ID card from the other EGWP plan. We will disenroll you from the AlaskaCare EGWP but will you will continue to receive standard AlaskaCare pharmacy benefits.

  15. What if I have already enrolled in Medicare Part D as an individual?
  16. For most members, the benefit provided through your AlaskaCare retiree plan provides better value than an individual Medicare Part D plan. If you wish to keep your Individual Part D plan, you must opt out of the AlaskaCare EGWP plan. Retirees that opt-out of the AlaskaCare EGWP will be placed in a prescription drug program that is much different than the plan prescription drug benefits offered today. This may result in increased out-of-pocket expenses for you or your Medicare-eligible dependents.

  17. Will I receive a new ID card?
  18. Yes. The Division worked closely with the new PBM to make the transition as smooth as possible for all members. This included sending a welcome kit containing ID cards, plan information and other resources to help members. Members should have received new ID cards the first week of December 2018.

  19. Why did I receive more than one ID card with different ID numbers?
  20. Please select the scenario that best describes you:

    • I am covered under a single AlaskaCare plan, and…
      • I am a retiree that is not eligible for Medicare:

        ID cards are issued in packs of two to retirees that are not eligible for Medicare. If you have an eligible dependent, you can share the extra card with your dependent. If you have more than one eligible dependent, you can request additional cards through OptumRx at (855) 409-6999. Starting January 1, 2019, you can also print a temporary card from the OptumRx portal, or use the OptumRx mobile app.

      • I am a Medicare-eligible retiree who is not covered under the enhanced Employer Group Waiver Program (EGWP):

        ID cards are issued in packs of two to retirees that are not enrolled in the AlaskaCare enhanced Employer Group Waiver Program (EGWP). If you have an eligible dependent, you can share the extra card with your dependent. If you have more than one eligible dependent, you can request additional cards through OptumRx at (855) 409-6999. Starting January 1st,1, 2019, you can also print a temporary card from the OptumRx portal, or use the OptumRx mobile app.

      • I am a retiree covered under the enhanced Employer Group Waiver Program (EGWP):

        You should have received only a single ID card with the MedicareRx logo in the lower right corner (see example below). Please contact the Division or OptumRx for additional information on why you may have received a second card.

    • I am covered under my own plan and under my spouse’s AlaskaCare plan, and…
      • Both my spouse and I are either an active employee or a retiree not yet eligible for Medicare:

        You will both receive a two-pack of ID cards with your own name and ID number. You may share one copy of your ID card with your spouse, however, you or your dependents only need to present one of these ID cards to the pharmacy. OptumRx coordinates your coverage behind the scenes.

      • Both my spouse and I are are retirees and eligible for Medicare:

        If you are both eligible for Medicare and are enrolled in the enhanced Employer Group Waiver Program (EGWP), you should each receive a single ID card that has the MedicareRx logo in the lower right (see example below). Each card will have an individual name and ID number. Although you receive only one card, when you present the card at the pharmacy you will receive the benefit of your double coverage under the plan. This means you will not be required to pay a copay at the pharmacy counter.

      • One of us is a Medicare-eligible retiree enrolled in the enhanced Employer Group Waiver Program (EGWP) and the other is either an active employee or a retiree not enrolled in EGWP:

        The retiree who is Medicare-eligible and is enrolled in the enhanced Employer Group Waiver Program (EGWP) will receive a single ID card that has the MedicareRx logo in the lower right (see example below). The card will have their individual name and ID number. Although they receive only one card, when they present the card at the pharmacy they will receive the benefit of having double coverage under the plan. This means they will not be required to pay a copay at the pharmacy counter.

        The spouse who is not enrolled in the EGWP will receive an ID card two-pack in their own name for each layer of coverage they have (their own coverage and their dependent coverage as the spouse of a Medicare-eligible retiree). The only difference between the two packs of ID cards will be the ID number. The ID number that matches the Medicare-eligible retiree’s MedicareRx ID card will be the dependent coverage card. However, the spouse or other non-Medicare eligible dependents only need to present one of these ID cards to the pharmacy. OptumRx coordinates the coverage behind the scenes.

    • I am covered under more than one of my own AlaskaCare plans, and…
      • I am eligible for Medicare:

        If you are eligible for Medicare and are enrolled in the enhanced Employer Group Waiver Program (EGWP), you should receive a single ID card that has the MedicareRx logo in the lower right (see example below). Although you receive only one card, when you present the card at the pharmacy you will receive the benefit of your double coverage under the plan. This means you will not be required to pay a copay at the pharmacy counter.

      • I am not eligible for Medicare:

        You will receive an ID card two-pack for each layer of coverage you have. The only difference between the different packs of ID cards will be the ID number. However, you only need to present one of these ID cards to the pharmacy. OptumRx coordinates the coverage behind the scenes.

    Sample card:

    OptumRx EGWP pharmacy card

  21. Can my dependent use my card at the pharmacy and vice versa?
  22. OptumRx coordinates all the layers of coverage for you and your dependents behind the scenes, so in many cases you and your dependents can use each other’s cards at the pharmacy. However, a non-EGWP dependent should not use the card that has a MedicareRx logo in the lower right corner. This card would only work if the pharmacist uses the correct person code (to identify them as a dependent rather than the policy holder). To avoid any confusion at the pharmacy, we recommend you and your dependents only use a card that has your name on it.

  23. I am an active employee AND a retiree. How do I know which card is for my active plan and which one is for my retiree plan?
  24. You can tell the difference between the cards by looking at the logo on the card. One will say AlaskaCare Employee Pharmacy Plan, and the other will say AlaskaCare Retiree Pharmacy Plan. Your employee plan will typically be the primary payer.

  25. What happens if our new prescription cards are not received by January 1, 2019?
  26. If you need to fill prescriptions before your card arrives, you can contact the Division and we will print or email a temporary card. As of January 1, 2019, you can get a printable ID card from the member portal, or view your card in the mobile app.

  27. Can I opt out of the enhanced EGWP plan?
  28. You can opt out of the enhanced EGWP, but this is highly discouraged and will result in higher costs for both you and the health plan. Centers for Medicare and Medicaid Services (CMS) require that you be given the opportunity to opt out of EGWP. Retirees that opt out of the AlaskaCare EGWP will be placed in a prescription drug program that is much different than the plan prescription drug benefits offered today. This will result in increased out-of-pocket expenses for you or your Medicare-eligible dependents.

    If you are considering opting out because you are covered under another Medicare plan (e.g. Medicare Advantage that includes prescription drug coverage or another EGWP), in lieu of opting out you can provide a copy of your Medicare Advantage or EGWP ID card to the Division and we will remove you from the enhanced EGWP and place you in the AlaskaCare standard pharmacy benefit plan.

    You can call the Division Monday through Thursday, 8:30 a.m. to 4 p.m. and Friday from 8:30 a.m. to 3 p.m. AKST toll-free at (800) 821-2251 or in Juneau at (907) 465-4460, or email at doa.drb.benefits@alaska.gov.

  29. What are the opt-out plan benefits?
  30. If you are eligible for the enhanced EGWP and do not opt out, or if you are covered under another Medicare plan and contact the Division with evidence of that coverage, you will retain the Standard Benefit with the following provisions:

    Standard Benefit
      Generic Up to 90-Day or 100-Unit Supply Brand Name Up to 90-Day or 100-Unit Supply
    Network pharmacy copayment $4 $8
    Mail order copayment $0 $0
    Supply Limit
    Depo-Provera (injectable contraceptive) 5 vials per benefit year

    If you are eligible for the enhanced EGWP but choose to opt out, you will receive the opt-out benefit with the following provisions:

    Opt-Out Benefit
    Retail 30-Day at Network Pharmacy
    Prescription Tier Coinsurance Minimum Covered Person Payment Maximum Covered Person Payment
    Generic prescription drug 80% $10 $50
    Preferred brand-name prescription drug 75% $25 $75
    Non-preferred brand-name prescription drug 65% $80 $150
    Out-of-Network Pharmacy
    Coinsurance for all prescription drugs 60%
    Mail Order 1- to 90-Day at Network Pharmacy
    Prescription Tier Copayment
    Generic prescription drug $20
    Preferred brand-name prescription drug $50
    Non-preferred brand-name prescription drug $100
    Out-of-Pocket-Limit
    Annual individual out-of-pocket limit $1,000
    Annual family out-of-pocket limit $2,000
    Special Note:
    Coordination of Benefits The opt-out benefit is exempt from coordination of benefits.

    Remember: If you opt-out of the enhanced EGWP, you will be enrolled in a plan that is much different than the benefits offered today. This will result in increased out-of-pocket expenses for you or your Medicare-eligible dependents.

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Pre-Authorization and Appeals Questions

  1. What differences could I expect in the AlaskaCare EGWP?
  2. Here’s what won’t change:

    • Copayments will remain the same at $0 mail order, $4 generic, $8 brand-name.
    • Covered medications will remain the same.
    • Filling prescriptions at the pharmacy will remain the same.
    • The value of your benefit will remain the same.
    • The current plan allows filling a prescription for 90 days or up to 100 units. This will not change.
    • The current appeals process will remain the same. You will not be required to use the federal appeals process.

    Here’s what will be different:

    • You will receive several mandatory mailings from OptumRx.
    • You will receive a separate monthly explanation of benefits of your prescription claims.
    • The pharmacy network will change. We don’t believe these changes will substantially impact members, but you will want to check to be sure your preferred pharmacy is in-network.
    • Medicare has a list of drugs that require pre-authorization. These required prior authorizations do not include any “step therapy” requirements. (“Step therapy” is when an insurance plan requires a member to try certain lower-cost medications first before covering a more expensive type of medication.) You may have to get a prior authorization for drugs where it was not previously required or seek prior authorization for drugs that have already been pre‐authorized through Aetna under the current plan.
    • If you have multiple medical conditions and high drug-utilization, you may be enrolled in the Medicare Medication Therapy Management Program by the State. Medicare developed this program as a member protection. This program helps you and your doctor make sure that your medications are working to improve your health and provides a comprehensive review that includes: how your medications are working; if they have side effects; and any interactions between drugs you are taking. You can opt out of this program.
  3. Will changing to an AlaskaCare EGWP require me to use the federal appeals process instead of the current state appeals process?
  4. The current appeals process will remain the same. You will not be required to use the federal appeals process.

  5. Will all my current prescriptions be covered in an AlaskaCare EGWP? How and when can I verify this?
  6. Yes.A full list of covered drugs is available on the AlaskaCare OptumRx web page.

  7. How will I know if I need prior authorization to receive one of my prescriptions? What can I do to ensure I can still get my prescriptions filled on time?
  8. You will be mailed a welcome kit with information about your pharmacy benefits the first week of December 2018. You or your health care provider can begin the prior authorization process by contacting OptumRx, who will work with you on prior authorizations. In addition, the Division will work with OptumRx to provide targeted communications to members who are known to be taking medications that require prior authorization.

  9. Why do I need to obtain prior authorization of medicines that I have been taking for years?
  10. Medicare does not allow prior authorizations from another plan to be transferred to the EGWP. Medicare may also require prior authorization for drugs that previously did not require prior authorization.

  11. Could the prior authorization decision result in a determination that I must try a new, less expensive drug before the plan will cover the medication I am currently taking? (This is known as step therapy.)
  12. No. Prior authorization is used to determine if Medicare will cover the drug under the Medicare Part D (pharmacy program), under the Medicare Part B (medical program), or will not cover the drug at all because it is excluded under Medicare. Step therapy is not part of the AlaskaCare EGWP.

    If your current prescription is not covered by Medicare, it would be covered through the wrap as part of the AlaskaCare EGWP.

    If your prescription is covered under Medicare Part B, your copay will remain the same.

  13. Does EGWP mean the Pharmacy Benefit Manager (PBM) will decide what medication my doctor can prescribe?
  14. No. Your doctors can still prescribe whatever medication they think is most appropriate for you and your co-pay will remain the same as it is today, $0 mail order, $4 generic, and $8 brand-name (or $0 for those covered under more than one AlaskaCare plan). Depending on what they prescribe, the medication may require prior authorization. And just like today, all claims, not just prescription drug claims, must be medically necessary in order to be covered by the health plan. Determinations of medical necessity are part of the claims processing function for all health care plans and can be complex depending on the situation. AlaskaCare has long relied on our Pharmacy Benefit Manager (PBM) to make evidence-based decisions on medical necessity as part of the pharmacy claims processing function, and this process will continue under an AlaskaCare EGWP.

    There may be instances in which a member’s doctor will disagree with coverage decisions related to medical necessity. In these cases, we encourage members to appeal the PBM’s decision.

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Information for High Income Earners

Income Related Monthly Adjustment Amount (IRMAA) Information Flyer [PDF 938K]

  1. CMS charges a higher premium for high wage earners. How will I know if will have to pay extra if I am enrolled in the enhanced EGWP?
  2. Certain high-income retirees will have to pay an extra surcharge, consistent with the extra surcharge applied to Medicare Part B today. Generally, if you are an individual earning more than $85,000 per year or a married couple who earns more than $170,000 per year, you will be charged an extra premium for being enrolled in an AlaskaCare EGWP because it is a group Medicare Part D plan. CMS refers to this as Income Related Monthly Adjustment Amounts (IRMAA). If you are charged an IRMAA for your prescription drug coverage, the Division will cover the full cost of the premium. Contact the Division to learn about your options.

    Similar to Medicare Part B, the IRMAA premium amount will be deducted directly from your Social Security check if you qualify for Social Security or will otherwise be invoiced to you directly. The Social Security Administration (SSA) will send you a letter with your IRMAA premium amount and the reason for the determination. If you disagree with the IRMAA premium amount or your income has gone down, you should contact Social Security at (800) 772-1213 to resolve the determination.

    The Social Security Administration will use your Modified Adjusted Gross Income (MAGI) to determine if the income-related monthly adjustment amount (IRMAA) applies. MAGI is the sum of:

    • Adjusted Gross Income (AGI), which can be found on the last line your IRS 1040 tax form (line 37 on form 1040, line 21 on form 1040A, or line 4 on form 1040EZ), plus:
    • Any tax-exempt interest income (line 8b on form 1040).

    To make this determination, SSA requests income information from the IRS for the tax year that is two years prior to the premium year. For example, Social Security will use your MAGI from 2017 to determine your 2019 IRMAA. IRMAA is automatically re-determined each year as long as you file an income tax return.

    The table below shows the anticipated IRMAA for 2019 and is for illustrative purposes only. The MAGI and IRMAA are subject to change.

    Individuals MAGI (based on 2017) Couples MAGI (based on 2017) 2019 Extra Monthly Surcharge Amount
    Less than or equal to $85,000 Less than or equal to $170,000 $0
    $85,001-$107,000 $170,001-$214,000 $12.40
    $107,001-$133,500 $214,001-$267,000 $31.90
    $133,501-$160,000 $267,001-$320,000 $51.40
    $160,001-$499,999 $320,001-$749,999 $70.90
    Greater than or equal to $500,000 Greater than or equal to $750,000 $77.40

    You can find more information about Social Security determinations of IRMAA here.

  3. What are my options if I am required to pay the extra surcharge?
  4. If you receive notice from Social Security that you are required to pay the IRMAA surcharge for the enhanced EGWP, provide a copy of the notice to the Division of Retirement and Benefits as soon as possible. The Division will fund a Health Reimbursement Arrangement (HRA) account that can be used to reimburse you the surcharge amount. The full amount of Part D IRMAA will be covered by the plan.

    You can mail a copy of the notice to:

    Alaska Department of Administration
    Division of Retirement and Benefits
    P.O. Box 110203
    Juneau, AK 99811-0203

    You may also send a copy via email to doa.drb.irmaa@alaska.gov or fax to (907) 465-3086.

  5. What if I refuse to pay the extra surcharge?
  6. If you refuse to pay the extra surcharge, Medicare will cancel your enrollment in the AlaskaCare enhanced EGWP plan. This will be treated as an opt-out under the plan, and you will be placed in a prescription drug program that is much different than the plan prescription drug benefits offered today. This alternative plan may result in increased out-of-pocket expenses for you or your Medicare-eligible dependents. Please contact the Division if you have concerns about this surcharge or would like to understand the options available.

  7. What information does the Division need to establish a Health Reimbursement Arrangement (HRA) account to reimburse me for the IRMAA?
  8. Each November you should receive a letter from Social Security that outlines your Medicare premiums, including whether you are subject to the Income-Related Monthly Adjustment Amount (IRMAA) surcharge. You should provide a copy of this letter to the Division as soon as practicable.

    You can mail a copy of the letter to:

    Alaska Department of Administration
    Division of Retirement and Benefits
    P.O. Box 110203
    Juneau, AK 99811-0203

    You may also send a copy via email to doa.drb.irmaa@alaska.gov or fax to (907) 465-3086.

  9. How does the Health Reimbursement Arrangement (HRA) account work?
  10. Once the Division receives a copy of the annual letter sent from Social Security, we will establish an HRA through PayFlex, Aetna’s subsidiary that administers the HRA on behalf of AlaskaCare. PayFlex will send the member a letter that outlines how to access their HRA account information and how to set up claims for reimbursement. Members are encouraged to set up reimbursement on an automatic reoccurring basis, but may elect to request reimbursement manually. Reimbursement can be made by check or through electronic funds transfer.

  11. Are reimbursements from the Health Reimbursement Arrangement (HRA) account taxable?
  12. No. The HRA is a tax-advantaged account and is not taxable income.

  13. How do I apply for reimbursement from my Health Reimbursement Arrangement (HRA) account?
  14. To submit a claim to pay yourself back, fill out the paper claim form enclosed in your PayFlex welcome letter. After you submit the paper claim form, you can go online to Payflex.com and sign up for direct deposit to have your reimbursement deposited directly into your checking or savings account. If you don’t sign up for direct deposit, PayFlex will mail you a check.

    PayFlex Mobile® app
    The PayFlex mobile app is a great way for you to stay connected and up to date on your account information‚ wherever and whenever you need it most.

    Online Payment Features
    You can link a personal bank account to easily pay yourself back for the Medicare Part D Income Related Monthly Adjustment Account (IRMAA) surcharge.

  15. Can I set up automatic reimbursement?
  16. Yes, by submitting the claim form you will receive a monthly ongoing reimbursement in addition to any eligible reimbursement for previous months.

  17. I pay my Medicare Part D IRMAA quarterly. Can the ongoing reimbursement be set up to pay on a quarterly basis?
  18. Yes, your quarterly payment will be broken into monthly reimbursement via check or direct deposit when you submit the paper claim form.

  19. Do I have to go online to set up automatic reimbursement?
  20. No, you can set up automatic reimbursement by submitting the paper claim form.

  21. How long do I have to submit a claim to the Health Reimbursement Arrangement (HRA) account?
  22. HRA claims for dates of service in a benefit year must be submitted within 90 days of the close of that benefit year. In other words, claims for reimbursement of 2019 IRMAA must be received by March 31, 2020. Retroactive reimbursements will not be issued for claims received beyond 90 days after the close of the benefit year.

  23. What happens to unused funds in the Health Reimbursement Arrangement (HRA) account once the claim deadline is past?
  24. Unclaimed funds will be forfeit and will revert back to the Retiree health trust.

  25. Can the Health Reimbursement Arrangement (HRA) account be used to pay other medical expenses other than the Medicare Part D IRMAA?
  26. No. The HRA can only be used to reimburse members for the Part D income related monthly adjustment amount (IRMAA).

  27. Who can I call if I need more help in understanding this new plan?
  28. For general questions about how the plan works or how your drugs are covered under the plan, call OptumRx at (855) 409-6999.

    To find out if you will be subject to an extra surcharge because you earn a high income, you may contact Social Security at (800) 772‐1213.


The above information is provided for informational purposes. In the event of a conflict between the below information and the AlaskaCare Plan document, the plan document controls.

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