Medicare warns seniors of Part D scam

March 7, 2006 at 4:39 PM
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WASHINGTON, March 7 (UPI) -- Seniors should beware of scammers selling fake Medicare drug plans over the phone, government officials warned Tuesday.

Callers, pretending to be insurance company representatives, have tricked seniors into giving up their bank account numbers and other financial information to purchase Medicare Part D prescription drug plans that never materialize, according to a warning issued by the Centers for Medicare and Medicaid Services.

Under the benefit, the federal government contracts with insurance companies which offer prescription drug plans to seniors in Medicare.

As a result, most consumers have dozens of plans to choose from--a fact which some seniors have found extremely confusing. Scams could make reluctant seniors even more wary of the new benefit, which has struggled to reach its enrollment goals.

The scheme is called the "$299 Ring," for the typical amount of money Medicare beneficiaries are talked into withdrawing from their checking accounts to pay for a non-existent prescription drug plan.

No Medicare drug plan can ask a person with Medicare for bank account or other personal information over the telephone, CMS reminded seniors, and no beneficiary should ever provide that kind of information to a caller.

Legitimate plans bill plan members for their premiums, and the amount is often taken directly out of a customer's Social Security check.

Medicare has received similar complaints from Indiana, Michigan, Pennsylvania, Massachusetts, New Jersey and Georgia.

Complaints have been made against a number of different companies, but authorities believe that the scam is being run by the same few companies, which are typically based outside the United States.

Consumers can report these cases to their local law enforcement agencies or the Medicare complaint hotline 1-877-7SAFERX (1-877-772-3379).

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