Thursday, May 12, 2016

Question: Why am I Paying More for Prescriptions in 2016?

Several of our clients have been asking “Why am I paying more for my prescription drugs costs in
2016, even when I didn’t change my Part D insurance plan?” If you’re living on a fixed income, even a small change in what you have to spend for the prescriptions you depend on can have a huge impact on your day to day finances. Even, if you are not on a fixed income it still can be a concern.

There can be several things that have changed in your coverage which resulted in increases in what you pay. Here’s a list of some of the causes:

You may have purchased your medication out of network at a non -network pharmacy. Insurance companies negotiate special rates with pharmacies, just like with doctors and hospitals. Make sure you’re buying your drugs at a pharmacy that’s in your network, so you can receive full coverage for it.

Some insurance plans charge more for using their mail-order pharmacy. Some will charge less. If they charge less it is beneficial to use the mail order pharmacy on your maintenance prescriptions because of the cost savings involved.

You may still be paying for your initial deductible, if there is one. Don’t forget, every calendar year you have to satisfy your initial deductible all over again. So, you’ll have to pay the full cost of your prescriptions until you do so, and that amount varies based on the insurance plan that you have.

The plan you have may be using coinsurance to share the costs. Several plans require that you pay a copayment, which is a fixed amount, for the cost of each prescription. A few require instead that you pay “coinsurance,” which is a percentage of the cost of each prescription. If your plan changed from copayments to coinsurance as a “cost sharing model”, and your prescriptions are relatively expensive, the amount you pay may have gone up.

The drugs you use have gone up in price and your plan uses coinsurance. If the retail cost of a drug you use has increased, and your insurance plan requires that you pay a coinsurance, the amount you pay will increase, since coinsurance is based on a percentage model of cost sharing.

The medication you’re using isn’t covered anymore. If your medication has been dropped from your insurance company’s formulary (the list of drugs they cover) because a less ­costly generic drug has become available, you now could be paying for that medication in full. You may, however, request an “exception” by having your doctor contact your Part D insurance plan provider, and perhaps receive special coverage for that medication.

Your medication moved to a different formulary tier. When medications themselves get more expensive, insurance companies will often move them to a different “tier” in their formulary. Generally, this means that you pay a higher portion of the cost of that prescription yourself.
It is possible that you got moved to another plan. Sometimes insurance plans consolidate, and something called “cross walking” happens. When your plan merges with another plan, you may be “cross walked” right into a plan that requires that you shoulder a higher amount of the costs of your prescription drugs.

You may have reached the Coverage Gap, or “donut hole”. For 2016 once your drugs have reached the cost of $3,310, you’ll pay a higher percentage of the costs of your drugs until you reach the next level, Catastrophic Coverage. Remember, it is about what you and the insurance plan pay added together to get to the Coverage Gap. Catastrophic coverage level begins when your prescription out of pocket amount reaches $4850.00. Then your prescription costs plummet.

Keep in mind that the insurance plans send out an Annual Notice of Change every year right before the Annual Enrollment Period which runs from October 15 to December 7 each year. This Annual Notice of Change explains all about the next years benefits. You can check all your prescriptions and calculate how much you will be spending in the next year. 

If you are unhappy with the amount you will have to pay for your prescriptions with a Part D prescription drug insurance plan or a Medicare Advantage Plan you may choose another plan during the Annual Enrollment. With a Medicare Advantage Plan this means you may have to change your Primary Physician, Specialists and Hospitals.

If you need help finding the right plan please call.

Sonia Ashford

Sonia Ashford is an independent insurance agent in the Medicare field, and has delivered hundreds of speeches about turning 65, Medicare Advantage and Medicare supplement insurance to consumers in Tarrant County. A respected agent within the Medicare insurance industry, she is the owner of Ashford Insurance Services. Visit Sonia's agency website to learn more about how she can help you with your Medicare decisions.

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