NEW YORK (CNN/Money) - Seniors, brace yourselves. Tuesday marked the launch of the new discount-drug-card program, the first of many changes seniors will face under the new Medicare act.

The law has become highly controversial, with critics saying the benefits are illusory. But now there is a new study defying conventional wisdom.

"Our study found that there were substantial benefits to consumers and that some of the savings are substantial and significant and some people will benefit from these cards," said Trudy Lieberman of Consumers Union.

So, what do seniors need to know? To make an intelligent choice, here are today's five tips on how to choose a card.

First, don't confuse these cards with the new Medicare drug benefit announced by President Bush late last year.

CNNfn's Gerri Willis shares five tips on choosing a new discount drug card. Play video (Real or Windows Media)

The cards are part of an interim program that is in effect until Dec. 31, 2005, after which the entire bill goes into effect. But until then, insurance companies, health maintenance organizations (HMOs) and drug benefit managers may sell the cards for no more than $30 a year.

Once you buy one of the cards, you'll shave 10 to 15 percent off prescription costs and may even find savings up to 25 percent on certain drugs. The company offering the card will decide which prescription drugs will be discounted as well as the amount.

However, there are a few things you'll want to be aware of up front. Number one, the last thing you'll want to do is rush into anything. You can only have one approved card at a time and you'll have to stick with it until Nov. 15 of this year. If you're not happy with it, you can't change your mind in the middle of the cycle.

You can have other non-Medicare approved cards at the same time, but will not be able to combine several discount drug cards to get a bigger discount.

One other potential pitfall is that discounts on the cards can change from week to week. So a card you pick today may not give you as good savings tomorrow. Check for changes on the company Web site or call its toll-free number.

Consumers Union took 34 drug cards and evaluated them against the top 35 drugs that have the most impact on seniors' pocketbooks. It used Medi-Cal, California's Medicaid program as its benchmark.

The study found that 26 out of the 35 cards had prices that were below the Medi-Cal rate indicating substantial savings. Sounds great, right? And it is -- for some consumers.

The first thing seniors need to find out is what other drug coverage they have that pays for their prescriptions. The benefit they'll get out of the cards is heavily dependent on that.

According to Consumer Reports, there are several people who should consider getting a card: Those who have no coverage at all, those who have a Medigap policy that does not cover prescriptions or someone who has a retiree health plan that requires he or she pay a large portion of prescription drug expenses.

You might also consider it if you are a senior belonging to an HMO that offers no other drug coverage, or if you already have a drug-company card that doesn't cover all of your medication needs.

Those who probably do not need one of the cards are someone who has an HMO plan that offers drug coverage for both generic and brand-name medications, or if you belong to a state plan that offers a better deal. Or if you simply don't take many prescribed drugs.

If your health changes you can always enroll at a later date. Finally, if you already have outpatient prescription drug coverage through Medicaid, you are not eligible for a Medicare-approved drug discount card.

Lieberman says consumers need to be aware that picking a discount card is not as simple as picking a toaster. Anyone can buy a good toaster and it will work very well for them. But the value of a discount card depends on which drugs you take.

With that said, to find out about the card providers and for step by step instructions on how to sign up for one, visit Medicare's Web site at www.medicare.gov or call 800-MEDICARE.

When comparing the card choices review a few things, such as what drugs are on the list, what are the prices, which pharmacies will honor the card and is the card available in the state you live in? Many cards offer national coverage, but not all. For a better understanding of how the cards work, log onto www.calmedicareoptions.org.

As far as specific drugs are concerned, the card sponsors must offer a discount on at least one drug among 209 categories. That means a discount drug for blood-pressure medication, diabetes, and so on. The drugs covered, however, may not be the one prescribed to you.

Keep in mind that if your doctor needs to prescribe a drug that isn't on the list for your card, you will have to pay full price for the prescription (unless you have other insurance that covers outpatient prescription drugs).

When you choose a card, call the company that is offering it and ask for the Medicare-approved drug discount card enrollment form. If you need help with the form select the "Prescription Drug and Other Assistance Programs" on the Medicare Web site. Or contact your State Health Insurance Assistance Program (SHIP). Call Medicare's 800-number to find the telephone number for your SHIP.

Once your form has been approved, the company will send you the discount card along with other materials such as the discount drug list, pharmacy directory and information on what to do if you have a complaint. Another helpful site is www.medicarerights.org, which provides details on other discount options.

Finally, be aware of sellers trying to get you to buy fraudulent cards. Take special notice of anyone trying to sell you a card over the phone or at your door.

One of the biggest advantages of this provision is that consumers with very low incomes will receive a $600 credit in purchasing their drugs.

If your income is less than $12,569, or $16,862 for a couple, and you are not receiving drug coverage from any other source, then you can apply for this assistance when you apply for a prescription card.

The credit works very much like a telephone card. You present the card to your pharmacist and the amount you spend is deducted from the $600. The credit is available on all the discount cards and the qualifying procedures are very minimal. In fact, no proof of income is necessary. The government will use tax returns and Social Security records to check your income.

Under the program, the federal government will pay the fee for a Medicare-approved card as well as 90 to 95 percent of the cost of your drugs, up to $600 a year. If you don't use your entire $600 credit this year, you can roll it over to a new $600 credit in 2005.

If you decide to apply for the credit for the first time next year, make sure to do it in the beginning part of the year. Otherwise, you won't get the full $600. For example, if you join anytime between April 1 and June 30, 2005, you will only get $450. And the amount continues to dwindle after that.

These drug cards are not insurance. They are also not a substitute for any other health insurance you have that covers prescription drug costs. Therefore, Medicare is telling consumers not to drop any of your current prescription drug coverage for a discount card.

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Also, keep in mind these cards are more like a band-aid than a solution to the problem. The prices of pharmaceuticals are not controlled by these cards. This means drug companies can keep raising the prices if they want.

In fact, a recent report says prices for the top 30 brand-name drugs most commonly used by the elderly rose an average of 22 percent for each of the past three years, according to Families USA. And the price of prescription drugs taken by seniors shot up more than four times the rate of inflation last year.

Finally, we are still in stage one of the new Medicare act. Therefore, if you have employer-sponsored health care coverage, hold on to it. This is the gold standard of coverage for seniors.

Gerri Willis is a personal finance editor for CNN Business News. Willis also is co-host of CNNfn's The FlipSide, weekdays from 11 a.m. to 12:30 p.m. (ET). E-mail comments to 5tips@cnnfn.com.