Will Reimburse Out-of-Pocket Expenses; Provide Additional Aid for Low-Income Retirees

ANNAPOLIS, MD – Governor Larry Hogan, together with Senate President Thomas V. “Mike” Miller and Speaker of the House Michael E. Busch, today announced that the state will provide assistance to State of Maryland retirees who are transitioning to Medicare Part D prescription drug coverage on January 1, 2019.

As part of state pension reform legislation passed in 2011, retired state employees eligible for Medicare will be moving from the state’s prescription program to the federal Medicare Part D program on January 1, 2019.

To help alleviate the impact of the transition, the Hogan administration and presiding officers announced that the state will institute a one-year transition program that will reimburse all out-of-pocket pharmaceutical expenses for impacted retirees in excess of $1,500, which is the limit under the current state plan. This program will be open to all state retirees shifting to Medicare Part D prescription coverage on January 1, 2019. This announcement is the result of the Hogan administration and the presiding officers working in a collaborative, bipartisan manner to evaluate the best options in order to assist state retirees.

Additionally, the Department of Budget and Management (DBM), with the support of the General Assembly, will provide further ongoing assistance for these retirees through the existing Senior Prescription Drug Assistance Program (SPDAP) in the Maryland Department of Health. SPDAP assists low- and middle-income Maryland residents with their Medicare Part D premium and coverage gap costs and applies to people whose income is 300 percent of the Federal Poverty Level or below (less than $36,420 for one person and $49,380 for two people.)

Currently the program provides a maximum of $40 per month to assist eligible participants cover their Medicare Part D premiums and $1,000 toward the coverage gap subsidy.

“Our administration has consistently worked to make Maryland a better place to retire, including providing tax relief for retirees three out of four years in office,” said Governor Hogan. “This is another example of the bipartisan solutions we have been able to achieve here in Maryland by working together. I am glad that our administration was able to work with legislative leadership to provide this relief for state retirees who will be affected by this change.”

“We have the deepest respect for people who dedicated their careers to public service, and we have an obligation to help them make this transition as seamlessly as possible,” said Senate President Thomas V. “Mike” Miller. “The solution we’re announcing today will honor our commitment to our retirees.”

“The actions taken in Congress left retirees in the untenable position of having to transition to Medicare Part D more quickly than originally planned,” said Speaker Michael E. Busch. “The Governor, President and Maryland House of Delegates have been working diligently to help ease this transition for our retirees and I am pleased that we have come up with a short-term solution that gives us more time to help those retirees with overwhelming prescription drug costs.”

The Maryland Department of Budget and Management will work with the State Retirement Agency to actively engage state retirees who might be eligible for the program and commits to fully funding the program as it currently exists and covering additional costs as the result of new enrollment from state retirees. Program details will be shared as they are finalized and will be posted on the DBM benefits website at http://dbm.maryland.gov/benefits/pages/default.aspx.