New online tool available for comparing Medicare Part D plans

Although I always promote use of Medicare’s Plan Finder Tool during Open Enrollment to help you find the right Medicare Part D plan, today I came across another handy prescription drug plan search tool on the Q1Medicare website. This tool gives Medicare beneficiaries a chance to review all of the different Part D plans available for 2012 for their areas quickly and easily. Plus, it has advanced options to help you further refine your search.

What is the maximum you want to pay?

One of the best features of this tool is the option to limit your search by the maximum monthly premium, annual deductible, and co-payment for generic drugs you want to pay. For example, if you don’t want to pay any more than $50 a month for your premium, you can enter this amount and eliminate all the plans that are out of your budget. You can also select the type of coverage you need in the Coverage Gap (aka, donut hill), such as no coverage at all or coverage for generic drugs.

The tool also allows you to get other information about the plans, such as which plans offer mail service, how many people nationwide (or in your state) are members of the plan, and the number of drugs covered on the plan’s formulary (list of covered drugs). You can also ask the tool to display plans by premium (lowest to highest or vice versa), star ratings, state enrollment, or plan name.    

Remember, Open Enrollment ends early this year – December 7^th.  So to avoid a last-minute rush—especially smack in between Thanksgiving and the winter holidays—consider doing your homework now. This new plan comparison tool is a great place to start.

How to determine if you have creditable drug coverage

One of my neighbors, a retired school teacher, recently asked me if she should hold onto her prescription drug coverage that she has through her former employer or switch to Medicare Part D when she turns 65. As soon as I started to explain that it all depends on whether or not she has “creditable coverage,” her eyes began to go cross-eyed. So let me see if I can make this easier to understand for you and her.

Creditable coverage is coverage that is considered as good as or better than the standard coverage provided by Medicare Part D. Standard Medicare prescription drug coverage is actually very good, so if your employer’s plan is not that great—for example, if it has a very high deductible, very high co-payments, or a small list of covered drugs (formulary)—it may not be considered creditable coverage. If that’s the case, then you will need to switch to Medicare Part D (or a Medicare Advantage plan with prescription drug coverage, MA-PD) when you become eligible.

On the other hand, if your employer’s prescription drug benefit is considered creditable coverage, it’s wise to stick with that plan. In fact, in some cases you run the risk of losing your employer-group prescription benefit and your employer-group health insurance if you join a Medicare Part D plan!

How do I know if I have creditable coverage or not?

The easiest way to find out if you have creditable coverage is to look through the plan materials provided by your employer-group plan. At least once a year, your employer must send you a letter called a Notice of Creditable Coverage (or Notice of Non-Creditable Coverage). If you cannot find this letter, contact your plan’s benefits advisor and request the document be mailed or e-mailed to you.

If the letter states that the coverage being offered by your employer is “as good or better” than Medicare’s Part D coverage, you have creditable drug coverage. Make sure you keep a copy of this document on file. You should also request a copy of this document every year so you have proof that you have maintained creditable drug coverage. If you ever need to join a Medicare Part D plan in the future, you will need to provide these documents to the plan so you do not incur a late enrollment penalty.

However, if the drug coverage that is being offered through your employer is not as good as Medicare’s standard coverage, you will need to evaluate your options carefully. First, talk with your employer’s benefit advisor to find out if you can keep your group health insurance and enroll in Medicare Part D. If you can, ask for this in writing. As I mentioned before, some employer-group plans will not let you keep your health coverage if you elect Part D rather than sticking with the drug coverage provided in the health plan.

I really can’t stress enough how important it is to talk to your plan’s benefit advisor before making any moves at all. Every employer has different kinds of coverage and different rules pertaining to that coverage. Family and friends can give you some advice, but only your benefit advisor can give you the facts.

Reminder: Medicare Open Enrollment is now through December 7th.

Always Read the Fine Print When Comparing Medicare Part D Plans

On Tuesday, drugstore operator Rite Aid Corp. joined the prescription drug plan bandwagon by introducing a new Part D plan through a partnership with Envision Insurance. This announcement follows closely on the heels of new plans from CVS Caremark Corp. and Walgreens Co.—both introduced this month–and Wal-Mart Stores Inc., which launched its plan with Humana last year.

Like Humana has done with its low-cost Walmart-Preferred Rx Plan, big chains such as Rite Aid and Walgreens are trying to lure seniors into their plans by advertising either low monthly premiums, low co-payments, or even $0 co-payments for generic drugs. One of the reasons they can charge such low prices is because it’s a great way to fill as many prescriptions as possible and get more shoppers into their stores to buy other products.

The catch for the consumer, though—of course there’s a catch—is that these drugstore-sponsored plans have highly restrictive pharmacy networks. If you purchase your drugs from a pharmacy that is not in the network, you will more than likely have to pay more than what is advertised in the large print.

A $10 co-payment is not the same as a $1 co-payment.

For example, if you go to the website for Humana’s Walmart-Preferred Rx Plan, you will see that the plan offers a $1 co-payment for preferred generics. However, read the fine print, and you’ll discover that in order to pay only $1, you have to use a preferred pharmacy, which includes, surprise, surprise, pharmacies at Walmart, Walmart Express, Sam’s Club, and Walmart Neighborhood Market. The price jumps to $10 if you use any other pharmacy in the restricted network. For preferred brand-name drugs, you’ll pay a 20% coinsurance if you use a Walmart pharmacy, but almost double (37%) anywhere else within the network.

How close is a large chain pharmacy to your home?

Last year, despite my objections, a family member enrolled in the Humana plan. She loved the low monthly premium, but she hated that she would have to use a Walmart pharmacy to get the best prices for her medications. The closest Walmart is about 25 minutes from her home, so not only does she have to pay extra for gas, but it takes her more than an hour to get there and back by the time she parks and waits on line. (I’m still trying to convince her to switch to the mail-order pharmacy!)

The moral of this story is two-fold: Always read the fine print whenever you are comparing prescription drug plans, and make sure that your local or favorite pharmacy is a preferred pharmacy in the plan’s network. Large, national prescription drug plans from companies like Blue Cross Blue Shield, Medco, or Wellcare may have higher premiums, but if you prefer using a smaller retail pharmacy in your hometown, your total costs may even out in the end.

Reminder: Open Enrollment is now through December 7, 2011.

The Medicare Coverage Gap Discount Program:

What the Drug Makers Don’t Want You to Know, Part II

In discussing the Medicare Coverage Gap Discount Program yesterday, I explained why lower-cost generics are still the best way to lower your drug costs—even with the 50% discount on brand-name drugs in the Coverage Gap. Now I’ll share a little-known detail about the Discount Program that could affect you if you’re still using brand-name drugs.

Under the Discount Program, you’re entitled to a 50% manufacturer discount on covered Part D brand-name drugs when you reach the Coverage Gap (aka donut hole). So if the full cost of your brand-name drug is $130, for example, you’ll pay only $65 in the Gap, plus any nominal dispensing fee.

This all sounds wonderful, but we’re dealing with Medicare, so of course there’s a catch: The drug manufacturer has to sign an agreement with the Centers for Medicare & Medicaid Services (CMS) to participate in the program. And guess what? Not all manufacturers are participating in this program.

If a drug manufacturer does not agree to participate in the program:
• Its drugs will not be covered under Medicare Part D.
• Your plan cannot grant a coverage exception if you’re taking one of this company’s medications. 
• If you must take this particular drug, you’ll have to pay full price for it.  

Adding insult to injury

Here’s the real kicker: If you pay the full price for your drug because the manufacturer isn’t participating in the Discount Program, your out-of-pocket costs for this drug will not count toward getting out of the Gap and into the Catastrophic Coverage stage. So you could stay trapped in the Gap longer as you to continue to pay your monthly premium.

What drug manufacturers are participating in the Discount Program?

CMS has tried to be helpful by publishing a list of manufacturers that have agreed to participate in the program. But this listing doesn’t make a lot of sense unless you have a PhD in Med D. You can check it out by clicking here and then clicking on “2011 Labeler Code File” if you’re feeling adventurous. But if your doctor prescribes a new brand-name drug, I suggest you call your plan to make sure it’s covered. If it’s not, there may be a lower-cost generic that will work just as well for you.

Remember: Medicare Open Enrollment is now through December 7, 2011.

The Medicare Coverage Gap Discount Program

What the Drug Makers Don’t Want You to Know, Part I

Although the Coverage Gap Discount Program is no doubt very helpful if you reach the Coverage Gap (aka “donut hole”) and use brand-name drugs, what you may not know—and what the big drug companies hope you never figure out—is that even with the 50% discount on brand-name prescription drugs, lower-cost generic drugs are still the best deal in most cases.

For the past year, nonprofit groups and the media have all been touting the 50% brand discount as a great way to lower drug costs when you’re in the Coverage Gap. What they should be telling you, however, is although the discount is helpful, the real savings lie in generics, no matter what stage of the benefit you’re in. Generic drugs make the most sense in every benefit stage.

I’ve always recommended FDA-approved generic drugs as one of the best ways to lower your drug costs and delay entering the Coverage Gap. Not only do they generally cost up to 80% less than brands to begin with, but now you get an additional 7% discount on generics when you’re in the Gap. (In 2012, you’ll get a 14% discount on generic drugs in this stage.) 
 So even with the 50% discount on brand-name drugs, generics still make more sense.

With the generic version of Lipitor set to hit the shelves in November, let’s compare Mrs. Smith’s costs for Lipitor with Mr. Johnson’s costs for the generic version of Lipitor as an example:

Mrs. Smith Uses the Brand-Name Drug Lipitor
• During the Initial Coverage period, Mrs. Smith has a 25% co-payment on brand-name drugs. She pays $32.25 for a 30-day supply of her brand-name cholesterol drug, Lipitor.
• Mrs. Smith always uses brand-name drugs, so she reaches the Coverage Gap in July. Now she has to fork over $67.08 for Lipitor. This is the full cost of the drug minus the 50% discount!

Mr. Johnson Uses  Generic Drugs
• During the Initial Coverage period, Mr. Johnson pays $3.27 for a 30-day supply of simvastatin, which is a generic version of Lipitor.
• Mr. Johnson always uses generic drugs so he never reaches the Coverage Gap. But if he did, he’d pay only $13.11 for simvastatin. This is the full cost of the drug minus the 7% discount.

I know I’d much rather pay $13.11 for a generic that’s just as safe and effective as its $67.08 brand-name counterpart. I also know the big pharmacy companies are not happy I’m sharing this information with you, because they want you to buy their expensive brand-name drugs. They hope that by playing up the 50% discount, seniors will continue to stick with brands. I hope that having read this, you now know better.

In Part 2 of this series, I’ll share another little-known fact about the Discount Program that doesn’t make any sense at all.

Reminder: Open Enrollment for 2012 is October 15 through December 7, 2011.

Saving Money with the Mail-Order Pharmacy: Give it a Try!

Open Enrollment for 2012 is October 15 through
 December 7, 2011.

  You may recall a very popular 1970s TV commercial for Life Cereal, in which two brothers are discussing “some cereal” that’s “supposed to be good for you.” Neither wants to give it a try, so they push it toward their little brother, Mikey. Turns out little Mikey, who supposedly hates everything, really likes it.

For many seniors enrolled in Medicare prescription drug plans, a similar scenario often plays out. You may be constantly bombarded by letters from your plan telling you that switching to a mail-order pharmacy is good for you because it will help youlower your out-of-pocket costs and delay entering the Coverage Gap (donut hole). But you’re reluctant to give it a try for various reasons (procrastination, perhaps?) so you toss the information in the garbage.

I have to admit I was a little hesitant to try my mail-order pharmacy at first, simply because I didn’t want to deal with the paperwork involved. I thought it would be a hassle to switch my one prescription from my favorite retail pharmacy, but when I used my plan’s price comparison tool on its website and discovered I would pay $100 less a month with mail, I immediately made the switch. 

Guess what? It wasn’t a hassle at all! The customer service rep did all the work for me–she even called the doctor with my permission to get my prescription–and in a few days my medication arrived in a secure package in my mailbox.

Today I have nothing but good things to say about my mail-order pharmacy. I can order up to a 3-month supply of my medication for a lot less money than a 30-day supply at the local pharmacy. My drugs arrive in my mailbox, so I don’t have to drive to the pharmacy and use up gas or wait 15 minutes in line. (There’s never a line at my mailbox!)

If I have to work late, I don’t have to worry about the pharmacy closing before I get home — after all, my mailbox never closes!  And If I have a question about my medication I can call my plan and talk to a pharmacist any hour of the day, for as long as I want, without having to worry that I’m holding up the line. Best of all, my mail-order pharmacy sends me automatic refill reminders by e-mail, and I can order refills online.

I like to tell my friends and family that switching to mail order is like the switch we all made from typewriters to computers. Many of us were reluctant to try computers because switching required us to change our ways and learn a new skill. But wasn’t it wonderful once we got the hang of the Internet, e-mail, word processing, and Facebook? We like it! Hey Mikey!

Why It’s Important to Talk to a Real Person When Comparing Medicare Part D Plans

It recently came to my attention that the Plan Finder Tool on the Medicare website has a few database glitches, resulting in wrong pricing information for some health and prescription drug plans.

For example, one national Part D plan discovered last week that the pricing information for specialty drugs was incorrect when visitors to the website searched to find out how much their drugs would cost with this plan. I also heard from an insurance broker in Arizona, who told me she was also experiencing pricing errors while doing searches for her clients.

For years I have been telling Medicare beneficiaries that it is crucial to confirm the cost of your drugs each year during Open Enrollment. Medicare Part D plans can (and often do) raise co-payments or move drugs from lower-priced tiers to higher-priced tiers. So just because you are paying $10 for a drug right now doesn’t mean it will still be $10 in 2012.

That’s why even if you’re very pleased with the plan you have this year, you really should check the prices on all the medications you are taking for next year. I know it’s a major pain in the you know what–and one of the main reasons we all love to hate Medicare Part D–but by not taking the time to do this due diligence every year, you could be spending a lot of money than necessary.

Use Plan Finder as a Starting Point Only

So now we get back to my original topic. One of the online tools I always talk about is Medicare’s Plan Finder. Although I still highly recommend this site as a starting point for searching and comparing plans, the data glitches has me worried, because many seniors may be getting misleading information. Can you imagine thinking your drug is going to cost $50 a month with the XYZ Plan (based on the Plan Finder website), only to find out in January that it really costs $150 a month?!

Technology is a wonderful thing, and it has certainly made our lives easier. But when it comes to something as important as pricing your prescription drugs, my advice is to do it the old-fashioned way. Use Plan Finder or the plan’s website as a starting point, but then call your plan (or the new plan that you’re interested in joining) and speak to a real person. It may take longer to have the customer service representative look up each drug for you, but for peace of mind it’s well worth it.

Always Keep Records

Finally, when you do speak to the plan representatives on the phone, take careful notes and keep these notes in a safe place. For example, take note of the date and time you called, the representative’s name, and the specific dollar amounts that he or she provides for each of your medications. That way if there is a pricing error and you are charged more than you were told, you have all the necessary paperwork to argue your case. If you’re also using a website to get your medications costs, make sure to print out the pages and keep them safe with your records.

The Countdown to Medicare Part D Open Enrollment Is Over

Open Enrollment for 2012 begins today, October 15, and ends on Wednesday, December 7, 2011.

The 3 eligibility windows for joining or switching Part D plans

Since today is the start of the Annual Coordinated Election Period (or Open Enrollment), I thought I’d give a quick review of the 3 eligibility windows for joining or switching prescription drug plans.

1. Initial Enrollment Period
2. Open Enrollment Period
3. Special Enrollment Period

1. Initial Enrollment Period

If you are turning 65 and newly eligible for Medicare, you have 7 months to enroll in a Medicare Part D plan:

• Up to 3 full months before you turn 65
• During the month of your 65th birthday
• Up to 3 full months after you turn 65

If you join during the 3 months before you turn 65, your coverage will start on the first day of your birthday month. If you join during or after your birthday month, your coverage will begin on the first day of the next month.

For example, let’s say Patricia is going to turn 65 on May 10, 2012. Her eligibility window will be from February 1 to August 31, 2012.  If she enrolls in a plan any time in February, March, or April, her coverage will begin on May 1. If she waits to join on her birthday, her coverage will begin the following month, on June 1.

If you get Medicare due to a disability, you can enroll in a Medicare Part D plan:

• Up to 3 months before the 25th month of your disability
• Up to 3 months after your 25th month of disability
• During your Initial Enrollment Period when you turn 65

2. Open Enrollment Period

If you are already in a Medicare prescription drug plan (PDP) or Medicare Advantage plan with prescription drug coverage (MA-PD), you can switch to a new Medicare Part D plan during the Open Enrollment Period from October 15 through December 7.

3. Special Enrollment Period

Outside these two windows above, you may only switch plans if you qualify for a Special Enrollment Period (SEP). For example, you may qualify for an SEP for the following reasons:

• You lose creditable coverage (coverage as good as or better than standard Medicare) through no fault of your own
• You move to a new permanent address that is not in your current plan’s service area
• Your current plan no longer offers prescription drug coverage
• You receive Medicaid or get Extra Help with Part D costs
• You are enrolled in a State Pharmaceutical Assistance Program (SPAP)

How to avoid a late-enrollment penalty

I talked a lot about the late-enrollment penalty yesterday, but I want to remind you again that if you choose not to enroll in a Part D plan when you first become eligible, Medicare will impose a monthly penalty if you join later. To avoid paying a late-enrollment penalty:

• Make sure you join a Part D plan during your Initial Enrollment Period.
• Be sure to enroll in a plan within 63 days of not having a Part D plan or other creditable coverage, such as coverage from:
• A current or former employer or union
• TRICARE
• Department of Veterans Affairs
• Let your new prescription drug plan know within 63 days if you had other creditable coverage (your former plan must send you a letter called “Notice of Creditable Coverage,” which you can use as proof of coverage when you join a new plan).

Countdown to Medicare Part D Open Enrollment: Day 2

Open Enrollment for 2012 begins tomorrow, October 15,
and ends on Wednesday, December 7, 2011.

Day 2: The Medicare Part D Myth Buster–Why you should enroll when you first become eligible

If you’ve ever watched the show Mythbusters on the Discovery Channel, you know the hosts Adam Savage and Jamie Hyneman set out to prove–or bust–some of the craziest myths out there. Would a bull do damage in a china shop? Nope, in fact they’ll daintily and nimbly walk among the aisles of breakables. Can you teach an old dog new tricks? You sure can!

So here’s a big myth about Medicare Part D prescription plans that I’m going to dispel for you: “If I don’t use many drugs, or no drugs at all, it’s not worth it for me to enroll in a Medicare Part D plan and pay a monthly premium.”

Busted.  That’s like saying you’re not going to get auto insurance because you’ve never had an accident before.

Unless you have creditable prescription drug coverage through another plan (such as from your former employer or union, TRICARE, or Department of Veterans Affairs), it pays to enroll in a plan and pay the monthly premium.

Here are 3 reasons why you should enroll in a Part D plan when you first become eligible:
1. You can’t put a price on peace of mind
2. You can’t sign up for a plan mid-year
3. You will pay a late-enrollment penalty if you change your mind later

Although you may not use many or even any drugs right now, you never know what your drugs needs are going to be down the road. Sure, you may luck out and never have to take drugs for a chronic condition (such as asthma or diabetes), but what if you were in an accident or had a bad case of the flu and had to take a lot of drugs? Without Part D, you’ll be out of luck (or money). Do you really want to worry about that on top of everything else?

Still not convinced? Let’s say you become eligible for Medicare in February but decide not to join a plan because you don’t take any drugs. In June, you’re diagnosed with Lyme disease, so your doctor prescribes several expensive medications. A few months later you experience some complications and have to take a few more drugs. Some of these new-fangled drugs cost hundreds of dollars for people without insurance–why chance it?

The dreaded late-enrollment penalty
Are you starting to think twice about delaying enrollment now? If not, the late-enrollment penalty should be the deciding factor.
If you don’t enroll in a Part D plan when you first became eligible, or you go for 63 continuous days or more without creditable prescription drug coverage,* you will more than likely have to pay a monthly penalty if you join a Part D plan later.

If you must pay a late enrollment penalty:
• The penalty amount will be added to your premium invoice each month.
• You will be charged a penalty for as long as you have Part D coverage—it follows you everywhere, even if you switch plans.
• The penalty amount will change each year, based on the national base plan premium.

How to determine the amount of the penalty that you will pay:
• Count the number of full months you delayed joining a Part D plan after you were first eligible to enroll or the number of full months in which you did not have creditable prescription drug coverage for more than 63 days.
• The penalty is 1% for every month that you delayed or didn’t have creditable coverage.
• Multiply the penalty percentage (1% x number of months) and the national base plan premium (for 2012, the average is $31.08). Then round to the nearest 10 cents.
• For example, if you go 10 months without prescription drug coverage, you will have to pay an extra $3.11 each month in 2012 (1% x 10 x $31.08 rounded up).

In this example above, an extra $3.11 a month doesn’t really sound like much, but do you really want to pay more than everyone else for the same thing?

Tomorrow, the first day of Open Enrollment, I’ll review eligibility windows for enrollment and go over again how to avoid the late-enrollment penalty.

*Creditable prescription drug coverage is coverage that is at least as good as Medicare’s standard prescription drug coverage.

Countdown to Medicare Open Enrollment: Day 4

Open Enrollment for 2012 begins on Saturday, October 15, and ends on Wednesday, December 7, 2011.

Day 4:  Open Enrollment is open season on Medicare fraud

Yesterday I discussed the importance of being alert to Medicare fraud and scams, particularly this time of year when Medicare Part D marketing is in full swing. According to a 2010 Nightline investigation, Medicare fraud costsU.S.taxpayers more than $60 billion a year. Yes, billions with a “b.”

 To help you better identify fraud and protect yourself—and others—from being scammed, here are a few things to be on the alert for at all times:

• You’re asked for money or for your personal information (e.g., Medicare
  or Social Security numbers, bank account number, credit card number, etc.) by someone pretending to represent Medicare, Social Security, and/or a Medicare plan sponsor.
• Another person asks to use your Medicare prescription drug card to obtain drugs at the pharmacy.
• You’re asked to sell your Medicare prescription drug card.
• Several payers (insurance plans), including Medicare Part D, are billed for the entire cost of the same prescription.
• Your Explanation of Benefits (EOB) statement or Medicare Summary Notice lists prescriptions for medications you are not taking or services that were not ordered by you or your doctor.

In addition to being on the alert, you should also carefully review and keep records of your health care visits, services, prescriptions filled, medical equipment provided, significant lab work, etc. It’s also important to file copies of any bills or notices from insurance companies, doctors, hospitals, pharmacies, etc., as well as your canceled checks. Then every time an EOB statement arrives in the mail, read through it carefully and compare it to your receipts to make sure everything is correct.

To learn more about you can help stop Medicare fraud, visit the U.S. Department of Health & Human Services and the U.S. Department of Justice’s Stop Medicare Fraud website. The site has answers to frequently asked questions, as well as important information to help you better understand your EOB statements and find out what to look for in these documents.

The Senior Medicare Patrol (SMP)

If you want to get even more proactive in the fight against Medicare fraud, consider becoming a volunteer with the Senior Medicare Patrol (SMP). SMP is a group of highly trained volunteers who help beneficiaries avoid, detect, and prevent health care fraud. There are SMPs in every state and many U.S. territories—to find the SMP nearest you, click here.