Are You Paying Too Much For Your Prescription Drug Plan?

By Marlo Sollitto, AgingCare.com contributing editor

Many seniors who are covered by Medicare are paying more than they need to for prescription drugs, according to a study by PlanPrescriber. The research suggests that far more Medicare beneficiaries could benefit from comparing their Medicare prescription drug plan options during the Medicare Annual Enrollment Period to determine if there is a more cost-effective plan available to them. In fact, according to the results, 90% of seniors are not in the Medicare prescription plan with the lowest out-of-pocket costs.

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The study evaluated more than 22,000 Medicare beneficiaries who entered their current plan and medication information into the PlanPrescriber.com tool during last year’s Medicare Annual Enrollment Period. Only 7% were in the Medicare prescription drug plan with the lowest total out-of-pocket costs available to them, and less than 10% were in the Medicare Advantage prescription drug plan with the lowest total out-of-pocket costs available to them. The study also found that in at least 18 states, nearly 90% of users could reduce their total out-of-pocket costs for prescription drugs by switching to a plan that optimized their prescription drug coverage.

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90% of Seniors Pay Too Much for Medicare Prescription Drug Plan originally appeared on AgingCare.com.  Check our Medicare Open Enrollment section for all your Medicare information.

Data showed that changing to the plan with the overall lowest out-of-pocket cost could potentially save the average user with a Medicare PDP $546 in 2011, or $505 for the average user with an MAPD Plan in 2011. The analysis found that the average customer would spend $2,110 per year with their existing Medicare PDP and $2,420 per year with their existing MAPD Plan.

Furthermore, 68% of those analyzed never hit the Medicare prescription drug coverage gap (the donut hole) in 2011 with their existing prescription drug plan or Medicare Advantage Prescription Drug Plan, the study shows. Among users who hit the donut hole, one-third (36%) would hit the donut hole before August of 2011 with their existing Medicare prescription drug plan.

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The PlanPrescriber tool calculated the user’s known prescription drug costs based on their specific drugs and dosages and factors in their monthly premiums, co-pays, coinsurance and deductibles to generate an estimate of their total out-of-pocket costs for prescription drugs in that upcoming year.

“Changes in medication usage notwithstanding, the prices customers pay for their coverage can change significantly from year to year because many insurers change components of their drug plans each year,” says Steve Zaleznick, Senior Medicare Advisor of PlanPrescriber.com, a website that provides free comparison tools and educational materials for Medicare-related insurance.

These changes may include the drugs covered on a plan, the premiums, deductibles, coinsurance, or co-payments charged to enrollees, and different drug tier systems being used by insurers, which assign different coinsurance and co-payments to drugs depending on their tier. “Any one of these changes can significantly impact what a beneficiary pays out of their own pocket on a Medicare Part D prescription drug plan from year to year,” he says. “In many instances the lowest cost plan for an enrollee in one year is not the lowest cost plan the following year.”

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90% of Seniors Pay Too Much for Medicare Prescription Drug Plan originally appeared on AgingCare.com.  Check our Medicare Open Enrollment section for all your Medicare information.

21 comments

Patricia H.
Patricia H.4 years ago

thanks for sharing

David Lam
David Lam4 years ago

Great article!

Ed G.
Ed G.4 years ago

I am inching up there and am looking at the option. Right now I am scared. Apparently the decision as to which health care plan covers what medication is a nightmare. People supposedly specialize trying to make heads or tales out what should be a simple process. Congress has made another mess I am afraid.

Margaret D.
Margaret D.4 years ago

Whether you are a senior or just an average American citizen or legal resident, the cost of healthcare in the USA is absolutely OBSCENE!!!! So many people die from lack of healthcare due to NO insurance. So many people have no insurance because they can't afford it! If this country had done YEARS AGO what so many other countries have done and provided healthcare for their people (with some very MODEST co-pays), this country would not be going through what it is going through now! Don't let them fool you with false statements. My brother in Canada just had a knee replacement and he was in the hospital 4 days and it did not cost him a penny!!!! He also has a nurse coming to his house daily for a week!!! In the USA, you would be pushed out of the hospital in 2 or 3 days and pay through the nose for copays and co-insurance etc., not to mention what you pay monthly for that health insurance!!! If the USA had set up a plan YEARS ago, it would already be in place and the cost would have been included in the budget. Instead they let the medical society and pharmaceutical companies pay them off and now affordable healthcare is like a pipe dream! You either pay or you die or live in pain! The USA is a great country to live in IF you have money - a lot of money to cover your healthcare! God help you if you get sick and you don't work for a big company that provides decent coverage! Many do NOT now!

D B.
D L B.4 years ago

I recently turned 65 and already Medicare is a royal pain in my rear. My doctor and I have had to change three of my drugs, since they aren't covered. I've taken these drugs for years and have had no trouble with them. Now trying to find something that is covered is taking a toll on me because of side effects and such. Sigh...this is just the beginning.

Lynn C.
Lynn C.4 years ago

Thanks for this article. I've tried to understand if it would be advantageous for my parents to be on a plan - not much luck.

Shirley Bauer
Shirley Bauer4 years ago

You just can't get old anymore.....too costly.....what a shame in the United States of America.......

Katie K.
Katie K.4 years ago

I guess the only thing we can do is just not get sick. If you do, we just hang in there and hope your own bodies defenses help it pass. Pharm companies are a joke. I always thought social security and medicare where an award for making it. After working and contributing until 62yrs of age anyone deserves to take it easy. Dislike for the elderly is one prejudice we all get over if you live long enough.

Suzanne H.
Suzanne H.4 years ago

Medicare is too expensive for me

Treii W.
Treii H.4 years ago

thanks