It’s finally about to happen: The coverage gap or “donut hole” hated and often feared by many Medicare recipients will breathe its last on Jan. 1. So what does this mean for you?
Hopefully, more savings.
With us now in the annual enrollment period (Oct. 15 through Dec. 7), the RxLive team wanted to cut through the noise and spell out what’s happening and its potential impact on you.
Don’t just let ’er roll
First of course, a reminder that the open-enrollment period is a great time to examine any changes to your current medication regime, which could make a difference in whether you stick with your current Medicare plan or consider changing to another that may better suit your current needs than the one you chose this time last year. Remember, plans’ prescription drug formularies often change from year to year, so as we say at RxLive, “It’s great to check your meds!™” and that’s part of what we do in a private, secure medication consult with you.
While we’re not licensed Medicare agents, we do know a fair amount about prescription drug coverage under the various Medicare options; once we walk through your meds together, we often can provide you some important food for thought.
No more nasty donut hole!
Depending on your Part D prescription plan coverage, the donut hole/coverage gap has been a fearful event. It was originally designed as a cost-saving measure for the new Part D program in 2006; at first, Part D didn’t pay anything toward drug costs in the donut hole. That could really add up. Just getting to the “catastrophic stage” could indeed be a catastrophe to the finances of you and your family.
In 2012, the Affordable Care Act (“Obamacare”) enacted a gradual reduction of patients’ cost-sharing in the donut hole. By 2018, patients with prescription drug coverage paid 35% of brand-name drugs and 44% for generics, decreasing in 2019 to no more than 25% for brand-name meds and 37% for generics. This Jan. 1, drug plan members will pay no more than 25% of their plan’s cost for any covered prescription from the time they meet their deductible (if their plan has one) until they reach the out-of-pocket spending limit (up to $5,100 in 2019).
While all of that sounds like good news — and it is — remember that each plan is different and you could still face sticker shock if you’re not careful. You still bear the cost of your plan’s co-payment or coinsurance during the initial coverage phase, and depending on your plan’s prescription tiers, 25% or more of a Tier 4, 5 or 6 medication (such as for HIV, cancer and other diseases) could still cost you a lot, significantly affecting your financial health.
The bottom line
To net it out what we’re saying is that while closing the donut hole in 2020 can save you money, it will only potentially reduce your costs while you’re in the cost area that was formerly considered the hole. Patients who end up there will still have to pay 25% of the plan’s cost of medications until they reach $5,100 and the catastrophic phase. But that’s still way better than having to pay 100% in the coverage gap as was originally required.
So the formula for cost savings remains simple: fewer meds, generics and other less-expensive options are still your best bets to saving money, along with the discount or support programs Carlos mentioned.
A final additional tip for Medicare patients: Any prescription you purchase outside of your Medicare insurance plan will not be automatically counted toward your deductible. Many of the discount programs and coupons can be used along with your insurance coverage. But If if you’re using a coupon or prescription discount service that gives you a discounted price only if you don’t file with your Medicare plan, anything you get filled outside of your plan (GoodRx is an example) won’t count towards satisfying your deductible. So factor the cost savings of going outside of your Medicare plan with that in mind. It may or may not still be worth it.
Confused yet? I know. Other than the vitally important role of preventing our patients’ avoidable drug interactions and side effects, part of why the RxLive team exists is to have complicated situations like this make sense, and hopefully simplify your medication regime and save you money.
As always, let us know how we can help. Schedule a private, secure video chat or phone medication consult through this link or by calling (866) 234-4974. We’d love to talk with you.
