Analysis of Medicare Part D Prescription Drug Costs — Astounding and Disappointing

How much could strongly promoted medications cost our seniors? Is there anything else Medicare beneficiaries should know?

The Centers for Medicare and Medicaid Services (CMS) mandates that insurers offer Part D medication insurance. Most insurers must cover at least two prescriptions in most categories, including heart meds, arthritis, and depression/anxiety. Three well-known “designer drugs” from each category were chosen at random. They’re all famous brands thanks to advertising.

A generic choice in each group was also given as an alternative when using Medicare’s find plans feature. The analysis involves a dozen medicines. As per Medicare’s tool, the results are for the year 2022.

We have nothing against these medications or their makers. They’re vital for millions of senior Americans’ health. But they come with a “sticker shock” price.

To traverse this “consumer-driven” health landscape, examining your data by the output sections is vital. First, see whether any Part D plans cover your drug.

Like Lipitor versus Atorvastatin, some brand names aren’t covered by Medicare part D ​​​​​​​ plans. In the analysis:

• The plan with the lowest premium plus prescription expenses doesn’t cover four of the nine brand-name drugs.

• Four of the five tiers covered the rest.

You should also check for restrictions:

• Does the prescription require pre-authorization?

• Will there be a quantity limit?

Only two arthritis medications require pre-approval, and three have dosage restrictions. Celebrex’s generic version has a quantity limit, but Celebrex doesn’t. Preauthorization isn’t necessary for any cardiac or depression/anxiety drugs. However, three have quantity restrictions.

Also, consider costs. The costs in the chart are from the most affordable Part D plan. Most promoted medications cost above $1,000 per year, and seven of the nine brands have significant expenses. Prices ranged from roughly $3,000 to over $85,000 per year.

Do retirees see changes in Medicare Part D costs during annual open enrollment?

No. Most Medicare Part D plan holders don’t re-shop. They don’t know their in-network pharmacies are no longer in-network. Less than 30% of Medicare beneficiaries reevaluate their Part D or Medicare Advantage plans with Part D during yearly enrollment. It grows worse with age:

• 65% of those aged 65-74 didn’t shop for insurance during open enrollment; 

Using the plan-finding tool is too hard for many elderly Americans. So how will they inform themselves?

We asked a local pharmacy how one can compare prices for a Part D plan. He said no one at the pharmacy would know about any local pricing possibilities. Even the pharmacist won’t know costs until the insurer bills. And the costs for the same prescription vary between Part D plans. He suggested checking with your carrier or simply Googling it.

How is this acceptable?

More key points

This analysis’s extra notes may help you investigate Part D:

The cost of non-covered specialty medications is unaffordable for most patients. Still, they’re highly advertised, intending patients to ask for them by name. Be careful!

• It’d be reasonable for all the generics to be found in tier 1 pricing. But in this study, they were ranked differently. (See chart.)

• Only one generic in this analysis costs $1/month. Their brand version is $3.50 or $9.50 each month. The pricing of generic medications is neither predictable nor consistent.

• In this analysis, only one pharmacy was preferred, in-network. The preferred pharmacy’s drug pricing should always be lower than non-preferred or OON pharmacies. Not really. Four of the nine brand-name medicines have the highest cost at the preferred in-network pharmacy. Out-of-network pharmacies are offering the lowest prices for the same four medications.

• Is mail order always the cheapest option? No. Only four of the 12 medications had it. Most times, it was within $10. But Celecoxib’s postal order is $56 more. Xeljanz’s is $110. Rexulti’s is $130 more.

Consider Medicare Part D Options Before 65

This short analysis required hours to understand how Medicare Part D works. It’s complex, to put it mildly. There’s no consistency. You don’t know what you’re missing unless you go deep into the results. You can’t rely on one drug’s findings to be the same in all Part D plans.

But we expect our seniors to do this every year. That’s wrong.

The “consumer-driven” Medicare program begins at age 65. You’re fully responsible for all analysis, appraisal, and interpretation of Medicare’s find plans tools. Every year of retirement.

Waiting until 65 to start your own drug plan is a mistake. Depending on your medication, you may be overpaying by thousands of dollars annually. Also, call for a specialty drug. Call every insurer that covers your medicine. Begin exploring all options well before you need to make a decision.

Call an independent insurance broker to help you work things out. Call a State Health Insurance Assistance Program volunteer. All viable options. But you don’t want to go into these discussions blindly.

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Bio:
Mark, a lifelong Tulsan graduated from Westminster College, Fulton, Missouri with a Bachelor of Arts in Accounting. Mark served in the United States Army as a Captain in the 486th Civil Affairs BN. Broken Arrow, Oklahoma and retired in 1996. Mark is married to his high school sweetheart Jenny and has four beautiful children. Mark’s passion for his work, which includes over 20 years in the Financial Industry started as an Oklahoma State Bank Examiner. Mark examined banks throughout Oklahoma gaining a vast knowledge and experience on bank investments, small business and family investments. Mark’s experiences include being formally trained by UBS Wealth Management, a global investment firm where he served as a Financial Consultant specializing in Wealth Management for individuals & families. Mark is a licensed Series 24 and 28 General Securities Principal and an Introducing Broker Dealer Financial Operations Principal. Additionally, Mark is a Series 7 and 66 stockbroker and Investment Advisor focusing on market driven investments for individuals, businesses and their families. Mark specializes in providing financial knowledge, ideas, and solutions for federal employees, individuals, families and businesses. We serve as your advocate, and assist you in the design and implementation of financial strategies while providing the ideas to maximize your security and wealth. Our goal is to give you maximum control of your financial future. We provide the expertise to help you with personal issues such as: practical tax Ideas, risk management, investment solutions, and estate preservation. Additionally, we’ve counseled hundreds of employees on their transitions from careers in federal government, and private industry to their next life stage, whether that is retirement or a second career. We specialize in devising strategies that roll your TSP, 401(k), pension plan, to a suitable IRA to meet your objectives.

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