Amazing Medicare Drug Plan?
There is no such thing as an amazing Medicare drug plan.
That’s the unfortunate truth. But there’s things we can do to help protect you from extreme costs when it comes to your prescription drug coverage.
First, what are drug plans lacking?
A maximum out of pocket for starters.
No matter how much you spend in prescription drug costs throughout the year, there is nothing preventing you from having additional costs for your next prescription fill.
No limit for your costs like almost every other type of insurance.
Because every drug plan has 3 main stages.
- Deductible and Initial Coverage
- Coverage Gap aka Donut Hole
- Catastrophic stage
Deductible and Initial Stage
The deductible and initial coverage stage is where the majority of people are for most of their lives in their drug plan. They have set copays for their prescriptions and maybe for some that are a bit more expensive they have to reach a deductible before that copay kicks in.
Coverage Gap
You reach the Coverage Gap which is also known as the donut hole when your total medication costs reach a certain amount. This amount changes each year but it’s a little over $4,000 right now. It’s important to understand that this number isn’t how much you spend in prescription costs. It’s how much the total cost of your medications is.
So if you pay a $10 copay for a medication that costs $100, then $100 goes into the bucket for the total cost of your medications.
Once your total cost reaches that roughly $4,000 dollar amount, then you start paying 25% of the cost of the medication instead of whatever your copay is. So in the above example, you start paying $25 instead of $10 to fill that $100 prescription
You stay in the coverage gap until your costs reach a certain amount which also changes each year. Right now that amount is a little over $6,000 per year.
Catastrophic Stage
Finally you reach the Catastrophic Stage. Now you are paying only 5% of the cost of the medication instead of 25%. That helps a lot.
But unfortunately some of these medications are REALLY expensive.
Prescription Cancer costs on Medicare
There have been great advancements in medication recently. Some of these advancements have been medications like oral chemo.
The downside is they are very expensive. Some of them retail cost at $20,000 per month. So even if you are in that Catastrophic Stage where you only pay 5%, that is still A LOT of money. 5% of $20,000 is $1,000 per month you are paying just for that one medication.
A study was done showing that many people who have Medicare Part D coverage who are prescribed one of these cancer medications end up with more than $8,000 in prescription costs each year.
That’s just for that one medication. It doesn’t consider anti nausea or any other medications you need filled.
Those are really high cancer costs on Medicare.
And Medicare supplements don’t cover prescription medications. So even though they are excellent plans, they can’t help here at all.
What’s a formulary
A formulary is a fancy word for which medications each drug plan covers. Because they don’t cover every single medication available.
Many drug plans cover close to 5,000 medications on their formularies.
So if each plan covers 5,000 medications then obviously there are even more medications in the world than that.
But a small percentage of those medications make up for a majority of the costs of filling prescriptions. How much?
250 drugs make up 60% of the total Part D spending
You read that right.
Only 250 drugs account for 60% of the total costs when it comes to Medicare prescription drug plans.
That’s less than 5% of the drugs that exist! And they make up 60% of the cost.
So what can you do?
Well insurance is about protection and reducing your risk.
Many of these medications that are so expensive are cancer drugs. The good news is there is a cancer protection plan.
For a dollar a day, you can get coverage to protect yourself from this risk. So if the worst does happen, you aren’t trying to find a way to pay for your medications while more importantly battling cancer.
Many companies offer these plans. And they look similar at first.
But there are some major differences.
Some companies only pay out for certain cancers. Like your cancer diagnosis isn’t critical enough to warrant being covered…
Contact me to see about these plans and what one makes sense for you.
Mike Lovell
855-712-7316