Is Your Medicare Drug Plan Naughty or Nice?

The holidays are here again. That means it’s time for decorations, gifts, family, friends, and food. But during the celebrations, seniors enrolled in Medicare Part D should carve out some time to consider how their current prescription drug plan is working.  

At the end of each year, from Nov. 15 through Dec. 31, Medicare provides seniors with an open enrollment period and an opportunity to switch plans — or sign up for coverage for the first time.

Thanks to the plan’s unique design, seniors can choose from a variety of plans offered by private insurers. Unlike traditional government programs, where there's just one plan for everyone, Medicare Part D is structured so that insurance companies must compete for customers. As a result of this competition, premium prices are lower than Congress anticipated when it created the new benefit, and coverage options have flourished.

While the prices of some drug plans will increase for next year, 90 percent of beneficiaries will have access to at least one plan with a premium that is lower than they are paying this year.  Seniors are automatically reenrolled in their current plan if they don’t take action to switch.

This past year, the program provided benefits to almost 24 million Medicare beneficiaries. Meanwhile, polls repeatedly show that the great majority of seniors are happy with their coverage.  

This isn’t to say the program has no pitfalls.

Not every plan covers every brand-name drug, so members need to shop around to find a plan that covers the drugs they need.  Others may want to switch to a generic to save money. But for some brand-name drugs that still are under patent protection, a generic version may not even exist. It’s important for seniors to consult with their doctors about medication options and to examine the list of drugs offered by drug plans.

So be sure to go over the options carefully, as different plans cover different drugs. And the drugs covered by each plan may change from year to year.  

Other problems with Part D include the dreaded “doughnut hole” designed by Congress –a gap in coverage between moderate and high drug expenses.

By making smart, informed choices, however, seniors can minimize their exposure in this gap.  In California, for example, Part D enrollees can choose between 14 different plans that offer coverage in the gap. These plans often lower costs by promoting generics, but at least one of them still covers brand-name drugs.  

Seniors should look not just at premium prices but also at their total out-of-pocket costs.  Picking a plan with a higher premium might make sense in order to save on drug expenses in the gap and to get the brand drugs that work best for them.

Eligibility and application procedures vary by company, but Medicare, health plans, and doctors, and other advisers can assist in making decisions.  Some drug plans have kiosks in pharmacies during open season to answer questions in person.

Seniors may also want to consider a Medicare Advantage program. About 20 percent of Medicare enrollees currently utilize an Advantage plan that combines physician, hospital, and diagnostic care, along with prescription drug coverage, in one plan.

Medicare Part D is a much better option for seniors than importing prescription medications online from foreign distributors. With 10 percent of the world's prescription drug supply now estimated to be counterfeit, it is very risky to purchase medicines from Internet pharmacies whose suppliers may be in China, India, or other countries with questionable safety standards.

America is about choices. Seniors have a chance now to see if there may be a better plan to provide safe prescription drug coverage.  They can call 1-800-MEDICARE or go to www.medicare.gov to get started.  Seniors with low and modest incomes may qualify for extra help in paying premiums and copayments.  And for seniors who haven’t signed up, this is the time to get started.    

Grace-Marie Turner is president of the Galen Institute, a research organization based in Alexandria, Va., that focuses on free-market ideas for health reform.

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The holidays are here again. That means it’s time for decorations, gifts, family, friends, and food. But during the celebrations, seniors enrolled in Medicare Part D should carve out some time to consider how their current prescription drug plan is working.  

At the end of each year, from Nov. 15 through Dec. 31, Medicare provides seniors with an open enrollment period and an opportunity to switch plans — or sign up for coverage for the first time.

Thanks to the plan’s unique design, seniors can choose from a variety of plans offered by private insurers. Unlike traditional government programs, where there's just one plan for everyone, Medicare Part D is structured so that insurance companies must compete for customers. As a result of this competition, premium prices are lower than Congress anticipated when it created the new benefit, and coverage options have flourished.

While the prices of some drug plans will increase for next year, 90 percent of beneficiaries will have access to at least one plan with a premium that is lower than they are paying this year.  Seniors are automatically reenrolled in their current plan if they don’t take action to switch.

This past year, the program provided benefits to almost 24 million Medicare beneficiaries. Meanwhile, polls repeatedly show that the great majority of seniors are happy with their coverage.  

This isn’t to say the program has no pitfalls.

Not every plan covers every brand-name drug, so members need to shop around to find a plan that covers the drugs they need.  Others may want to switch to a generic to save money. But for some brand-name drugs that still are under patent protection, a generic version may not even exist. It’s important for seniors to consult with their doctors about medication options and to examine the list of drugs offered by drug plans.

So be sure to go over the options carefully, as different plans cover different drugs. And the drugs covered by each plan may change from year to year.  

Other problems with Part D include the dreaded “doughnut hole” designed by Congress –a gap in coverage between moderate and high drug expenses.

By making smart, informed choices, however, seniors can minimize their exposure in this gap.  In California, for example, Part D enrollees can choose between 14 different plans that offer coverage in the gap. These plans often lower costs by promoting generics, but at least one of them still covers brand-name drugs.  

Seniors should look not just at premium prices but also at their total out-of-pocket costs.  Picking a plan with a higher premium might make sense in order to save on drug expenses in the gap and to get the brand drugs that work best for them.

Eligibility and application procedures vary by company, but Medicare, health plans, and doctors, and other advisers can assist in making decisions.  Some drug plans have kiosks in pharmacies during open season to answer questions in person.

Seniors may also want to consider a Medicare Advantage program. About 20 percent of Medicare enrollees currently utilize an Advantage plan that combines physician, hospital, and diagnostic care, along with prescription drug coverage, in one plan.

Medicare Part D is a much better option for seniors than importing prescription medications online from foreign distributors. With 10 percent of the world's prescription drug supply now estimated to be counterfeit, it is very risky to purchase medicines from Internet pharmacies whose suppliers may be in China, India, or other countries with questionable safety standards.

America is about choices. Seniors have a chance now to see if there may be a better plan to provide safe prescription drug coverage.  They can call 1-800-MEDICARE or go to www.medicare.gov to get started.  Seniors with low and modest incomes may qualify for extra help in paying premiums and copayments.  And for seniors who haven’t signed up, this is the time to get started.    

Grace-Marie Turner is president of the Galen Institute, a research organization based in Alexandria, Va., that focuses on free-market ideas for health reform.

SHARE THIS ARTICLE

About the author