Alaska Department of Administration

Division of Retirement and Benefits

Edit by BC 4/30/24

Employer Group Waiver Plan

All the information you need about the Employer Group Waiver Plan in one place.

Introduction

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 Employer Group Waiver Plan for all Medicare-eligible members covered under the AlaskaCare retiree health plan. An Employer Group Waiver Plan, 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 previously 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 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.

Learn more about the AlaskaCare Retiree Health Plan 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 or reach the Division by phone toll-free at (800) 821-2251 or in Juneau at (907) 465-4460.

Eligibility and Enrollment

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.

In most cases you will not be charged a Medicare Part D premium when you are enrolled in enhanced EGWP. The AlaskaCare retiree plan, through OptumRx.com , 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.

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.

Contact the Member Education Center if you need assistance or have questions.

Medication Pre-Authorization

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. Medicare does not allow prior authorizations from another plan to be transferred to the EGWP.

This does not mean your the Pharmacy Benefit Manager (PBM) will decide what medication your doctor can prescribe. 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.

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.

When you reach the eligible age 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 Optum Rx, who will work with you on prior authorizations. In addition, the Division will work with Optum Rx to provide targeted communications to members who are known to be taking medications that require prior authorization.

Page Last Modified: 04/30/24 11:50:55

EGWP FAQs

I am receiving letters and phone calls from Optum Rx, asking for personal information. Is this a scam?

You may receive letters or a phone call from Optum Rx asking to confirm certain personal information, including: your name, address, residential address, birthday, and Medicare Beneficiary Identifier (your Medicare ID number). 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:

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

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I received an errata sheet from Optum Rx in the mail. Do I need to do anything?

If you received an errata sheet from Optum Rx, you do not need to take any action; it is intended for informational purposes only. Because the AlaskaCare enhanced EGWP is a Medicare part D prescription drug plan, the Centers for Medicare & Medicaid Services (CMS) requires that we send out errata sheets to inform members of any corrections or clarifications we have made to the plan’s abridged formulary, evidence of coverage, and summary of benefits. If you have any questions about any of the information on the errata sheet, please contact Optum Rx member services at (855) 409-6999 (TTY 711).

Please note that the AlaskaCare enhanced EGWP provides enhanced benefits beyond the Medicare Part D covered prescription drugs. Please refer to your AlaskaCare plan booklet to understand your full plan benefits.

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I received a letter from Optum Rx telling me I must opt out within 21 days. What if I need more time to make this decision?

Members who are enrolled in the enhanced Employer Group Waiver Program (EGWP) will receive a letter stating they have 21 days to opt-out of the EGWP. This is not a hard deadline. Members may elect to opt out of the enhanced EGWP at any time.

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I received a letter from Optum Rx asking me to provide a residential address. I use a P.O. box to receive my mail. Why am I being asked to provide a residential address?

The Centers for Medicare & Medicaid Services (also called CMS or Medicare) requires that you maintain a residential (physical) address within the Medicare service area. A post office box does not qualify. The service area includes the United States, the District of Columbia, Guam, Puerto Rico, the US Virgin Islands, Northern Mariana Islands and America Samoa. We need you to confirm that you live inside the plan’s service area. No mail will be sent to this physical address unless it is the same as your mailing address. It will only be used to verify that you live inside the plan’s service area.

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The letter I received asking me to provide a residential address made it sound like I could lose my prescription drug coverage—is this true?

We apologize for the tone of the letter, Medicare does not allow us to edit their required letters to add clarity. The intent of the statement in the letter is to emphasize that in order for AlaskaCare to continue to receive federal subsidies associated with your enrollment in EGWP, you must provide a residential address. You will not lose your coverage but if we do not receive your physical address, you will be disentrolled in the EGWP and placed in the AlaskaCare opt-out-plan. The opt-out plan may result in increased out-of-pocket expenses for you or your Medicare eligible dependents.

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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?

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.

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What if I or my spouse are currently enrolled in a Medicare Advantage plan?

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.

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Will the Part D Income Related Monthly Adjustment Amount (IRMAA) surcharge deducted in January be reimbursed by AlaskaCare?

Yes. The Part D surcharge deducted can be reimbursed through the Health Reimbursement Arrangement (HRA) account. Each year, usually in November, Social Security will send you a letter which will state the IRMAA amount you are required to pay for the upcoming calendar year. To receive reimbursement, you have three options to choose from:

You may register/log in to the Optum Rx member portal;
You can use the Optum Rx mobile app; or
You can request a paper form to enroll in the Part D IRMAA Health Reimbursement Arrangement (HRA).

Additional information can be found on our IRMAA webpage. If you have any questions about how to submit your IRMAA documents and the Health Reimbursement Arrangement (HRA), please contact Optum Rx at (855) 409-6999 or email .

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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?

No, you will not need to reapply for the LIS. Your LIS cost sharing/copays will remain the same.

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What is the Late Enrollment Penalty (LEP)?

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:

The member did not obtain creditable prescription drug (Rx) coverage when they were first eligible for Medicare Part D
The member had a break in creditable prescription drug (Rx) coverage of at least 63 consecutive days.

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What if I get a Late Enrollment Penalty (LEP) Letter? Will I have to pay the fee?

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.

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What can be done to remove the LEP?

You can remove a LEP in the following ways:

You can call Optum Rx at the phone number on the back of your ID card and speak to an agent who will explain the process to remove the LEP.
You can complete the "Declaration of Prior Prescription Drug Coverage" form included with the LEP letter and mail it to the following address:
Attn: Enrollment Services
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 must contact Optum RX no later than 30 days after receiving notification to complete an attestation and have the LEP removed.

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I received a check in the mail from Optum Rx. What is it for?

You may have received a check from Optum Rx for a variety of different reasons. To find out what the check was for and what to do next, please contact Optum Rx Member Services at (855) 409-6999.

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I have received an Evidence of Coverage letter from Optum Rx. This letter references an Initial Coverage Stage. What does this mean?

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.

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I received a formulary in the mail from Optum Rx and my medication is not listed. Will my medication still be covered?

The AlaskaCare retiree plan has what is called an “open formulary.” This means the AlaskaCare retiree 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.

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I received a Coordination of Benefits (COB) Survey. What is a COB survey?

The COB Survey is a notification to a Medicare beneficiary that the Center for Medicare Services (CMS) has other primary or secondary coverage information on file for that member. Part D sponsors are required to notify each beneficiary of other prescription drug coverage information and request that the beneficiary review the information and report back any updates to Optum Rx. You will need to follow the instructions outlined in the COB letter to update the information with CMS by contacting Optum Rx. Members can update their information by contacting Optum Rx Enrollment Services and an enrollment agent will assist with completing the update over the phone.

Optum Rx Enrollment Services (855) 880-9199.

In the event that other Primary coverage information is not updated timely, your prescription claims may reject at the pharmacy with a message to the pharmacy that there is alternative insurance coverage. To complete the COB survey, members should contact Optum Rx Enrollment Services at (855) 880-9199.

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Why did the State add an Employer Group Waiver Plan (EGWP)?

Moving to an EGWP had minimal impact to the membership and existing plan, while making 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.

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What is an “enhanced” EGWP?

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.”

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How does an EGWP work?

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 home delivery; $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 Optum Rx information web page. If you are currently taking a medication that requires prior authorization, your doctor will need to complete some information requested by Optum Rx.

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How am I enrolled in EGWP? Will I need to sign up for Medicare Part D?

If you are currently eligible for Medicare, or when you first enroll in Medicare, you need to provide the Division your Medicare Beneficiary Identifier (MBI – your Medicare Number). You do not need to enroll in an individual Medicare Part D plan.

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Why did the Pharmacy Benefit Manager change?

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 Optum Rx being selected to provide Pharmacy Benefit Management (PBM) services beginning January 1, 2019.

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Is there a separate Pharmacy Benefit Manager for the AlaskaCare EGWP?

No. There is one Pharmacy Benefit Manager (PBM) for all AlaskaCare prescription drug plans, including the AlaskaCare EGWP, Optum Rx.

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Why did the State change pharmacy benefits for Medicare-eligible retirees?

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.

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Are vaccines covered under the AlaskaCare EGWP?

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 Optum Rx information web page. Each vaccine is listed in the formulary as “viral vaccine” under the therapeutic drug class.

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Are vaccines covered for my dependents that aren’t eligible for Medicare?

Yes. AlaskaCare is extending these same benefits to non-Medicare eligible retiree and dependents.

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I heard EGWP isn’t constitutionally protected. Does that mean this plan isn’t protected either?

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.

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Can the State leave EGWP if it is not performing as expected or if the federal government defunds or significantly changes the program?

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.

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Why is it beneficial to the federal government to subsidize pharmacy benefit for retirees?

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.

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If I am enrolled in an AlaskaCare EGWP will this reduce my prescription drug coverage?

No, the prescription drugs covered under the current plan and the AlaskaCare EGWP will be the same.

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What are the “Donut Hole” (Coverage Gap) Stage and the Catastrophic Coverage Stage? Will I be subject to this under the enhanced EGWP?

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.

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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?

Because the AlaskaCare enhanced EGWP is a group Medicare Part D plan, if you have multiple retiree prescription drug coverages the AlaskaCare enhanced EGWP will become the primary payer. If your other retiree 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.

If you add other health coverage and become covered under an active employee health plan, that coverage will become the primary payer.

Please note that you can only receive home delivery prescriptions through your primary prescription drug coverage’s home delivery program. If AlaskaCare is now your primary coverage and you used to receive home delivery 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.

Optum Rx provides the home delivery pharmacy for the AlaskaCare plans. Please visit Optum Rx.com or contact Optum Rx at (855) 409-6999 to enroll in prescription home delivery. If you receive your medication through Optum Rx 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 you will continue to receive the standard AlaskaCare pharmacy benefits.

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What do I do when I become eligible for Medicare?

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. After you enroll in Medicare, you need to provide the Division your Medicare Beneficiary Identifier (MBI - your Medicare number).

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Will I be charged a Medicare Part D premium when enrolled in an enhanced EGWP?

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 for Part D coverage.

Medicare does require a premium payment (or surcharge) for individuals who are high-wage earners. This premium is referred to as the Income Related Monthly Adjustment Amount (IRMAA). The Division reimburses members who are assessed an IRMAA for Part D coverage. Learn more about IRMMA here.

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I am not Medicare-eligible, but my spouse is. Will they be enrolled in EGWP?

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.

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What if I am eligible for Medicare, but my spouse or other dependents are not yet Medicare-eligible?

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.

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What if I or my spouse are currently enrolled in an EGWP through another employer?

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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What if I have already enrolled in Medicare Part D as an individual?

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.

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Why did I receive more than one ID card with different ID numbers?

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 Optum Rx at (855) 409-6999. Starting January 1, 2019, you can also print a temporary card from the Optum Rx portal, or use the Optum Rx 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 Optum Rx at (855) 409-6999. Starting January 1st,1, 2019, you can also print a temporary card from the Optum Rx portal, or use the Optum Rx 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 Optum Rx 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. Optum Rx 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. Optum Rx 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. Optum Rx coordinates the coverage behind the scenes.
  
  Sample card:

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Can my dependent use my card at the pharmacy and vice versa?

Optum Rx 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.

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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?

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.

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Can I opt out of the Employee Group Waiver Plan (EGWP)?

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.

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 .

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What are the opt-out plan benefits?

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.

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How can I tell if the Prior Authorization letter I received is accurate or not?

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 Optum Rx at (855) 409-6999, TTY711 if you have questions about your prescriptions or any correspondence you have received from them.

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What differences could I expect in the AlaskaCare Enhanced Employer Group Waiver Plan (EGWP)?

Here’s what won’t change:

Copayments will remain the same at $0 home delivery, $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 Optum Rx.
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 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.

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Will an AlaskaCare EGWP require me to use the federal appeals process instead of the current state appeals process?

The current appeals process will remain the same. You will not be required to use the federal appeals process.

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Will all my current prescriptions be covered in an AlaskaCare EGWP?

Yes. A full list of covered drugs is available on the AlaskaCare Optum Rx web page.

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Does the Pharmacy Benefit Manager (PBM) decide what medication my doctor can prescribe?

No. Your provider can prescribe whatever medication they think is most appropriate for you and your co-pay will be $0 for home delivery, $4 for generic medications, and $8 for a brand-name medication. Depending on what your provider prescribes, the medication may require prior authorization. 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 relies 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 provider will disagree with coverage decisions related to medical necessity. In these cases, we encourage members to utilize the appeal process for reconsideration.

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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?

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 and is for illustrative purposes only. The MAGI and IRMAA are subject to change.

Individual Modified Adjusted Gross Income (MAGI)	Household Modified Adjusted Gross Income (MAGI)	Monthly Part D IRMAA Surcharge
Less than or equal to $91,000	Less than or equal to $182,000	Not assessed a surcharge
Greater than $91,000 and less than or equal to $114,000	Greater than $182,000 and less than or equal to $228,000	$12.40
Greater than $114,000 and less than or equal to $142,000	Greater than $228,000 and less than or equal to $284,000	$32.10
Greater than $142,000 and less than or equal to $170,000	Greater than $284,000 and less than or equal to $340,000	$51.70
Greater than $170,000 and less than or equal to $500,000	Greater than $340,000 and less than or equal to $750,000	$71.30
Greater than $500,000	Greater than $750,000	$77.90

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What are my options if I am required to pay the extra surcharge?

The Division is prohibited from paying your Medicare Part D IRMAA premium surcharge directly and will instead reimburse you. If you receive notice that you are required to pay the IRMAA surcharge for the enhanced EGWP, follow the steps outlined in question 74 to request reimbursement. The Division will fund a tax advantaged HRA account that can be used to reimburse you the Part D IRMAA surcharge amount by paper check or through electronic funds transfer to a bank account of your choosing.

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What if I refuse to pay the extra surcharge?

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.

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What information does the Division need to establish a Health Reimbursement Arrangement (HRA) account to reimburse me for the IRMAA?

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.

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How does the Health Reimbursement Arrangement (HRA) account work?

The Division has partnered with Optum Rx and Optum Bank for easy IRMAA reimbursement through your HRA account. Please allow up to 3 weeks for processing. 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.

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Are reimbursements from the Health Reimbursement Arrangement (HRA) account taxable?

No. The HRA is a tax-advantaged account and is not taxable income.

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How do I apply for reimbursement from my Health Reimbursement Arrangement (HRA) account?

The Division has partnered with Optum Rx and Optum Bank for easy IRMAA reimbursements and will handle all your IRMAA needs. Follow these steps to establish your 2021 Part D IRMAA reimbursement account online:

Register and/or log in to your Optum Rx.com account either online or through the mobile app.
Navigate to forms by clicking on the "Information Center" tab on the Navigation bar at the top, select "Programs and Forms", then click on “IRMAA HRA Enrollment Form”.
Complete the online IRMAA HRA Enrollment Form.
Upload as an attachment a copy or image of your letter from Social Security or a Medicare Bill that shows what your 2021 Part D IRMAA surcharge will be.
Optum Rx will confirm your eligibility and set up your Health Reimbursement Account (HRA).
Once your HRA has been created, Optum Bank will send you a Welcome Packet.
Log in to optumbank.com to view your HRA account status/balance or to sign up for Direct Deposit. Your banking information that may be with Inspira Financial cannot be transferred on your behalf to Optum Bank.

If you have any questions on how to submit your 2021 IRMAA documents online or if you do not have internet access and would like to submit paper documentation, please contact Optum Rx at (855) 409-6999 or email .

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Can I set up automatic reimbursement?

Yes, by submitting the claim form you will receive a monthly ongoing reimbursement in addition to any eligible reimbursement for previous months.

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I pay my Medicare Part D IRMAA quarterly. Can the ongoing reimbursement be set up to pay on a quarterly basis?

Yes, your quarterly payment will be broken into monthly reimbursement via check or direct deposit when you submit the paper claim form.

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Do I have to go online to set up automatic reimbursement?

No, you can set up automatic reimbursement by submitting the paper claim form.

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How long do I have to submit a claim to the Health Reimbursement Arrangement (HRA) account?

To receive reimbursement for the Part D IRMAA surcharge, you should submit the HRA claim as soon as possible, but not later than 12 months after the date you incurred the expenses. Retroactive reimbursements will not be issued for claims received beyond 12 months. Example: if you are assessed a Part D IRMAA surcharge in 2020, you will have until December 31, 2021 to file the HRA claim for reimbursement.

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What happens to unused funds in the Health Reimbursement Arrangement (HRA) account once the claim deadline is past?

Unclaimed funds will be forfeit and will revert back to the Retiree health trust.

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Can the Health Reimbursement Arrangement (HRA) account be used to pay other medical expenses other than the Medicare Part D IRMAA?

No. The HRA can only be used to reimburse members for the Part D income related monthly adjustment amount (IRMAA).

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Who can I call if I need more help in understanding this new plan?

For general questions about how the plan works or how your drugs are covered under the plan, call Optum Rx 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.

Income Related Monthly Adjustment Amount (IRMAA) Information Flyer

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Retiree FAQs

Alaska Department of Administration

Division of Retirement and Benefits