The new year brought on many changes in health reform; employers are
decreasing their contribution to higher premiums and increasing the
employee’s share, and Medicare has changed the way certain expenses are
reimbursed. The net affect may hit our pocketbooks a little hard this
year and for many it’s a hardship just to keep up with the cost of
living. One area that may bring relief for those on Medicare is a
reduction in the cost of prescription medicine, especially for those who
have large expenditures each year.
Remaining the same as in 2010, there are two choices for prescription
drug plans; supplemental plans working to fill the gap between Medicare
and actual costs. At open enrollment, the consumer can decide which
coverage to use, or whether to use a drug plan at all. The choices are
the Medicare prescription drug plan or Medicare Advantage (MA). These
plans have various premiums amounts based on the retiree’s annual
income. With all the changes made to Medicare this year, it is difficult
to understand certain areas such as the prescription plan changes;
however, the Medicare website (www.medicare.gov) is very helpful when
choosing the types of coverage desired.
An aspect that changed, within those two plans in 2011, is how spending
affects the doughnut hole. (The doughnut hole occurs when deductibles are met
and prior to catastrophic insurance kicking in.) This year the
pharmaceutical companies will discount brand name drugs by 50%, thereby
reducing out of pocket costs to the participant. Lawmakers are hopeful
the changes will benefit those who reach the doughnut hole threshold early
in the year. In the past, once the doughnut hole period began the insured
participant paid 25% of drug costs and remained in the doughnut hole until
the catastrophic plan was available. Now with the pharmaceutical’s help,
the insured will only pay 50% of the cost. In addition, there is no
longer a $10 co-pay and $310 deductible. Sounds like a neat little
package all tied up and easy to understand. It would be except there are
some confusing caveats that affect how and when costs are reimbursed.
The consumer can find helpful Medicare articles and handbooks, blogs,
FAQs, toll-free help, and calculators on the Medicare website to decide
which plan is best for them and what they might spend on prescriptions
in 2011.
There are others ways to save on prescription drugs. The consumer may
ask their doctor to prescribe generic drugs or a cheaper drug that will
still meet the requirements. For maintenance drugs, try the three-month
mail-in plans, which are generally cheaper. And for those who are low
income, there are assistance programs such as State Pharmaceutical
Assistance Programs (SPAP), community and faith based programs, and some
pharmaceutical manufacturers offer deeper discounts to low income
families to help with the costs.
