Step 1: Don’t assume your current Part D or
Advantage plan is still the best choice
Shopping around for
a Medicare Part D drug plan every
fall isn’t nearly as much fun as shopping for the swankiest hotel for your next
vacation. But the savings you can pocket by switching to a more cost-effective
Part D plan might pay for that trip.
An analysis by the Kaiser Family Foundation, a health care
research organization, found that monthly Part D premiums can vary by more than
500% within the same area for plans that offer the same benefits. Why spend
$125 a month if you can get the same coverage for $25?
Plus, your
out-of-pocket costs for any given drug can vary by thousands of dollars a year
based solely on the plan you pick—and if you’re like most enrollees, you’ll
have more than two dozen drug plans to choose from.
“Shopping around for
the right Medicare Part D plan is one of the best money saving strategies,”
says Mary Johnson, Medicare policy analyst at The Senior Citizens League
(TSCL). Yet in an TSCL survey, 80% of Part D enrollees say they don’t bother.
Even if you skip Part
D because you have a Medicare Advantage plan
that includes drug coverage, you shouldn’t be complacent. That coverage can
vary year by year as well.
Open enrollment, which runs from October 15 to
December 7, is your annual opportunity to cut your drug costs. Take it.
Where to start your
research
Reviewing how your
current prescription drug plan will change next year is crucial. Plans can
revise the copayment and coinsurance rates, or even stop covering a
particular drug, so a medication that was inexpensive this year might be
less so in 2019.
All of that is laid
out in the annual notice of changes (ANOC) that landed in your mailbox back in
September. Already tossed it? Ask for another copy, or log into your online
account to get the information.
Next pay a visit to
Medicare’s Find a Plan tool, which will give you a
rundown of the most cost-effective plans offered in your region (including your
current plan), based on the specific drugs you take.
This free tool will
factor in all your costs: your premium, any deductible you face (about 30% of
plans waive the deductible, which is $415 in 2019), and your estimated
out-of-pocket drug costs.
Spouses should shop
separately, notes Johnson. “It’s rare for a plan that is right for one of you,
based on the drugs you take, to be the best plan for someone else taking
different drugs.”
Why you have to dig
into the details
Premiums and
deductibles are important, but the coverage details for the specific drugs you
take can have the biggest impact on what you’ll spend. First, make sure
the drugs you take are still covered by your current plan or
any other ones you’re considering.
“Shopping around for the right Medicare
Part D plan is one of the best money saving strategies.”
Mary Johnson
The Senior Citizens League
Next you need to look
at the pricing “tiers,” which determine how high your copay will be. That
includes checking whether your current plan has moved one of your drugs to a
tier that makes you pick up more of the cost.
It’s common for
Medicare Part D plans to have two tiers for generic drugs, two tiers for
brand-name drugs, and a fifth for specialty drugs. A Tier 1 drug has a lower
out-of-pocket cost than a Tier 2 drug and so on. In 2011 more than 70% of
generic drugs were Tier 1, but by 2015 that was down to less than 20%,
according to the health care research firm Avalere.
Johnson recently took
a spin through 2019 plans available in the Charlottesville, Va. area, and
here’s what she found.
The monthly
out-of-pocket cost for the diabetes drug Novolog Flexpen was as little as $37
when the drug was covered, and more than $2,000 when the coverage was poor. The
cost for the popular pain med Lyrica ranged from $37 to $278. And asthma drug
Advair Diskus cost a low of $37 or a high of $1,880.
Don’t sweat the donut
hole (as much)
The changing cost of
the infamous Medicare Part D donut hole might
also change the calculus of what is best plan for you in 2019.
As anyone who takes
expensive meds knows, once your total drug costs exceed a base level for the
year, you hit a period of reduced coverage, commonly known as the donut
hole.
A bit of good news: If you fall into
the donut hole in 2019, your copay will be lower than in the past.
In 2019 the donut
hole starts at $3,820—that’s the total of what you spend out-of-pocket and the
amount your plan covers. Only when your total out-of-pocket costs reach $5,100
do you qualify for catastrophic coverage.
But in a bit of good
news, if you fall into the donut hole in 2019, your copay will be lower than in
the past. You will pay 25% of the retail cost for brand name drugs, down from
35% this year. The maximum copay for a generic drug will be 37%, compared to
56% in 2018.
“For many people, the
co-pay they have in the donut hole will be less than what they pay out of the
donut hole,” says Johnson.
If you haven’t
comparison-shopped for years, your donut-hole costs may have changed a lot. For
instance, back in 2011 you would have had to cover 93% of the price of generics
and 50% of the cost of brand-name drugs in the donut hole.
How to get one-on-one
help
If you want more help
sorting through your Plan D options, contact your local State Health
Insurance Assistance Program (SHIP). You can get free
personalized help, either over the phone or, in many states, in person if
you’re near a regional office.
Plus, during open
enrollment there are often presentations or workshops that can help you make
the smartest choice.
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