How to Make the Most of Drug Plans on Medicare.
Whether you’re new to Medicare or not, it can seem impossible to save money on your medical and prescription drug costs. You’re not alone. Enrollees are frequently frustrated by gaps in their policy coverage, particularly when these gaps affect their ability to get important medications at a low cost. Although it seems difficult, there are actually several ways to maximize the benefits of your drug plan. You just need to understand how these plans work and what you can do to bring costs down.
Understanding the “Donut Hole” (and How to Avoid It)
What is the donut hole?
The donut hole is a coverage gap in prescription drug plans. Simply put, this means that there’s a temporary limit on what a drug plan will cover. Not everyone falls into the donut hole. However, if you have high prescription costs, you may find yourself paying out of pocket beyond a certain point. In 2017, you’re in the gap once your plan has spent $3,700 (your initial coverage limit) on drugs and before you’ve spent a total of $4,950 (your catastrophic coverage limit). Next year, the initial coverage limit increases to $3,750 while the catastrophic coverage threshold increases to $5,000.
How much will I pay out of pocket once I reach the coverage gap?
In 2017, you’ll receive a 60 percent discount on the total cost of brand-name drugs while you’re in the donut hole if you’re enrolled in Medicare Part D; there’s a 51 percent discount on generics. Your out-of-pocket costs will count toward getting you out of the coverage gap.
How can I avoid the donut hole altogether?
Eating well and maintaining an active lifestyle can keep you from developing a variety of health problems, which will in turn help you to avoid costly medications down the road. But health conditions aren’t always lifestyle-dependent. If you have a medical problem that demands routine medication, then here are some tips for avoiding the donut hole:
- Shop around. Pharmacy prices on drugs can be dramatically different from one to the next. Don’t be afraid to call your local pharmacies and ask them what they charge for the prescriptions in question. There are even apps like GoodRX that can help you find the cheapest options out there. You may be surprised how much money you can save on your medications just by switching to a new pharmacy.
- While you’re choosing a pharmacy, consider signing up for a rewards program. Some larger chains offer rewards benefits for loyal customers (which are free to enroll in), so you may earn extra percentages off or free extras when you fill your prescriptions there.
- Ask your pharmacy if you can get a discount by buying a three-month supply, or if mail order is cheaper than pharmacy pickup. Some pharmacies offer steep discounts. Don’t hesitate to ask.
- Talk to your doctor to see if you can substitute your medications with lower-cost generic medications. Depending on the medication in question, this isn’t always an option. However, many medications have generic alternatives that are half the cost or more than that of their brand-name counterparts. You may be hesitant to bother your doctor with questions of finance. Don’t be. Your doctor just wants to take care of you, and if affording your medication is an issue, she’ll want to correct it if she can.
- Take advantage of whatever screenings your plan offers. An ounce of prevention is worth a pound of cure, as they say, and it’s true. Identifying problems early will keep costs down by preventing costlier problems later in life.
- Assess the different parts of Medicare carefully to determine the type of coverage that best suits your needs. Traditional Medicare (A and B) doesn’t cover prescription drugs, but you can add Part D, which is just drug coverage. You could instead enroll in a Medicare Advantage plan with drug coverage, a more comprehensive option that might actually cost less money. Do your homework, and don’t settle for a plan you don’t need.
Programs that Offer Financial Help
Another way to reduce your Medicare drug costs is to get assistance from federal programs or directly from drug manufacturers. If you know that your prescriptions costs are going to put you in the donut hole no matter how hard you try to save, you may need to consider finding a program to help you lower your out-of-pocket expenses. There are several federal programs you may qualify for as well as some offered by specific drug manufacturers. Here are two federal programs that could help you:
PACE is a program designed for Medicare or Medicaid beneficiaries that helps cover extraneous drug costs and other medical expenses that you may not be able to afford. How much you pay into PACE depends on your financial situation. Not everyone qualifies for it. To qualify, you must:
- Be 55 or older
- Live in the service area of a PACE organization
- Need nursing home level of care (this is described differently by each state.)
- Be able to live safely in the community with help from PACE
Extra Cost Saving Programs Under Medicare
Contact your local Medicare office if you think you may qualify for extra help paying for your healthcare and drug costs. You automatically qualify if you have Medicare and meet any of the following conditions:
- You have full Medicaid coverage
- You receive help from Medicaid programs to pay for your Part B premiums
- You get SSI benefits
If none of these apply to you, don’t worry. You may still qualify based on income and resources. Be sure to talk to someone at your local Medicare office. Even if they’re unable to enroll you in one of these program, they may be able to help you find another program that lowers your drug costs.
The best way to ease your financial burden and get the most out of your plan is to be proactive about your health and about saving money. Don’t be afraid to look at your options, ask questions and seek out second opinions. Take advantage of annual wellness screenings and testing, and do your best to manage your own health care with the help of your primary doctor. You can save money with Medicare if you’re diligent.