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Time To Check Medicare Prescription Drug Plan for 2009

Posted Oct 27 2008 1:02pm

By CK Wilde for 3GenFamily Blog

Has your parent’s monthly premium for the Medicare drug plan increased?

The 2008 Medicare Open Enrollment is November 15 to December 31, 2008. This is your opportunity to move to a plan that better suits current needs.

I went to the Medicare website to research 2009 prescription drug plans in our area. What I found surprised me!

Seniors in our area have 51 choices for drug plans. And, the choices among the 51 insurance carriers range from very low cost with lower coverage to higher cost with better coverage. The trick to getting the best plan for your needs comes down to fitting 5 key elements to your loved one’s particular medication needs.

Five Key Elements Determine True Cost of Seniors’ Drug Plan

The place to start is with your parent’s current plan. Sit down together and identify the cost for each of these:

  1. Monthly Premium -  the amount your parent pays each month for her/his current prescription plan.
  2. Annual Deductible - the out of pocket expense your parent pays before the company pays its first $1.
  3. Drug Cost Sharing - also called Co-payment or Co-Insurance, this is shown either as a percentage of the total cost of the drug or as a dollar amount.
  4. Total Paid in 2008 - estimate how much your parent will have paid this year for prescriptions. Is it over $2700? Is it over $3454? Are these generic drugs? Which generics?
  5. Coverage in the Gap - this has been called the “donut hole” - Here is the quote from Medicare’s website that explains it:

A coverage gap means that after you and your plan have spent a certain amount of money for covered drugs (no more than $2,700), you have to pay out-of-pocket all costs for your drugs while you are in the “gap.” The most you have to pay out-of-pocket in the coverage gap is $3,453.75. This amount doesn’t include your plan’s monthly premium that you must continue to pay even while you are in the coverage gap. Once you’ve reached your plan’s out-of-pocket limit, you will have “catastrophic coverage.” This means that you only pay a coinsurance amount (like 5% of the drug cost) or a copayment (like $2.40 or $6.00 for each prescription) for the rest of the calendar year.

Note: If you get extra help paying your drug costs, you won’t have a coverage gap. However, you will probably have to pay a small copayment or coinsurance amount.

Using Medicare’s online charts, you can figure out which plans in your area have lower premiums, lower deductibles and lower co-payments. (Mark these down on a sheet of paper or in an electronic spreadsheet.) You can also see the listing of plans in the 2009 Medicare and You Handbook and the information mailed by your parent’s current prescription plan.

If your Mom or Dad estimates that the total cost of drugs will be less than $2700 in 2008,  then you can focus on monthly premium, annual deductible and drug cost sharing (co-payment).

  • Is there a plan that is less expensive? Keep in mind that Monthly Premium and Drug Cost Sharing will affect the total cost more than annual deductible.
  • Is this new plan accepted by your current pharmacy? Convenience is an important issue. If your parent can’t easily get to the pharmacy, it’s not a savings.

The Donut Hole

What is a bit harder to do is figure out how the CoverageGap will affect the costs. To accurately evaluate it, you need to know what medications are being prescribed.

  • If the total cost (for the plan and your parent together) is more than $2700 during 2008, are any of these generic drugs?

The first year this Medicare program became available, there was no coverage from $2700 to $3453.75. It was the senior’s responsibility to pay for all medications up to $3453.75 out-of-pocket. Today, a number of the plan carriers are providing coverage for some or all generic drugs during the coverage gap. You may pay a bit more in monthly premium but the potential out of pocket savings are substantial.

  • Has the doctor prescribed only name brand drugs? Can generics be substituted?

Sometimes the doctor has a good reason for prescribing the name brand medication. Often, the prescription can be changed to the generic without ill effect. It pays to ask so that you can take advantage of coverage for generics during the “gap” period.

If you are having difficulty identifying the plan that’s right for your situation, you can get assistance from a trained Medicare representative by phoning 1-800-MEDICARE (1-800-633-4227). Take advantage of this help.

And, do it today so your Mom or Dad can start saving money in January!

What do you think about this post? Leave us a comment!

© 2008 CK Wilde. All Rights Reserved. Please feel free to link to this post but you must have prior written permission (please use the comments) to reproduce this post either whole or in part.

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