This is the time of year of when we start to get calls from our clients about their prescription drug coverage. These calls are usually made because of the infamous donut hole. Individuals who are not familiar with this gap, begin to pay higher copayments and wonder why. Although we did touch on this in a prior blog, we thought it would be worthwhile to cover this again because we do get so many questions on this topic.
Whether you have a Medicare Advantage plan with prescription benefits or whether you have a Medicare Supplement plan with a stand-alone Prescription Drug Plan (PDP), the coverage rules are applied exactly the same way. These rules are federal regulations that all plans must adhere to for prescription drug coverage.
First, your prescription coverage has what is called the “initial coverage limit (ICL).” The ICL in 2019 is $3,820. The ICL is the total cost of your medications including your copayments and the amount paid by your plan for your medications. Once you reach a total of $3,820 for the year, you enter the coverage gap or donut hole. In the coverage gap, you must pay 37% for generic medications and 25% for brand name medications, irrespective of tier or your benefit plan. When you reach the catastrophic level, your medication costs go down. In 2019, the catastrophic level is $5,100. The catastrophic level is “true out of pocket costs” or Troop. Troop includes your copayments, deductible (if you have one) coinsurance and a portion of the cost of both generic and brand drugs. Once you reach $5,100 in Troop, your copays go down to either $3.40 or 5%, whichever is higher, for generic drugs and $8.50 or 5%, whichever is higher, for brand drugs.
The good news with all of this is that your plan will send you an accounting of your costs so you will know when or if you are going to hit the donut hole. Also, if you do take very expensive medications, you will not likely be in the donut hole for very long due to the catastrophic cap on total costs.
Prescription drugs have become a main form of treatment in today’s health care system. That is why when we meet with our clients, we spend a lot of time researching their medications and helping them understand the costs associated with their prescription drugs. It is really such an important part of your benefit plan.
Please stay cool and stay hydrated through these hottest days of summer and remember that we are here if you have any questions on your prescription drug plans, or any other issue related to your coverage. We can be reached by email at email@example.com or by phone at 717-980-3201. And be sure to check out our web site at www.mediplanconnect.com.
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