Medicare D: finding a plan, avoiding pitfalls
by Caleb Reading
Basic steps for getting started:
You’ll need a list of all the prescription drugs you take along with the cash price and (if you didn’t pay the cash price) the price you paid under your current plan or discount card. You can get this printout at the drugstore you bought those drugs at. If you are going to be doing the drugstore legwork for someone else (a spouse or a parent, for example), the person you’re helping will need to write up a HIPAA permission for release of records. Basically, have them write a simple note like “[your name] has permission to get a printout of my drugs. [their signature and the date]” I know that seems like a silly rule, but if we give you a printout at the drugstore without that signature it could lead to as much as a $50,000 fine and 1 year in jail. I’m not kidding. And that’s just for a harmless mistake. If someone sold the information, they’re looking at up to $250,000 and 10 years in jail, under HIPAA guidelines. Don’t expect us to break HIPAA. It’s not going to happen.
This permission for release of records is not the same signature as the one they gave when they received a printout about the HIPAA laws. If they say, “I already signed something” get the note anyway. They may not have signed for release of records yet. You have to sign a release form to get access to your own records as well. Yeah, it’s dumb. Trust me, we know. We know all too well. And, no, we won’t make an exception just for you.
Step Two: While you’re at the pharmacy getting the printout, ask what plans they are contracted with. Write down the names of those companies; you need to know that. Some companies, like Aetna, aren’t going to be accepted hardly anywhere because they want us to sell every drug for our cost minus over 30%. Obviously, we can’t afford to do that, so we’re not taking Aetna cards unless they change the terms of their contract. Many companies are holding out on telling us what they’ll reimburse us for, because they don’t want us telling patients, “No, we don’t take that plan.” Right now, we’re only signed up for the plans of six companies out of hundreds. Please don’t expect a drugstore to accept any plan you sign up for. We are not obligated to lose thousands of dollars because you couldn’t be bothered to sign up for something other than, say, Aetna for example. Or Humana. There’s another one with an absurd reimbursement schedule.
Since you’re at the drugstore, holding a printout of all the drugs, go ahead and ask if any of the brand name ones are available as a generic yet.
Step Three: Do NOT ask anyone at the pharmacy to recommend a plan. We aren’t legally allowed to recommend a plan. Please don’t yell at us. We’re not trying to ignore you. We’re obeying the law. Taking an adversarial position against us helps no one.
(You can skip this step if you trust your insurance agent to do this for you.)
Pick your state.
Find the drug on your printout with the highest retail price. This is the drug you need coverage for the most. Type the name of that drug into the box. Spell it correctly. If there’s more than one word in the drug name and the printout doesn’t show the full name, that’s okay; type in the first word only. Hit “Search for Drug.”
It will now say “Review the drug list” and will ask you if you’d like to add additional drugs. You can add them all at once, but if even one isn’t covered you’ll get no results. I would suggest clicking “Continue with selected drugs” instead of adding more.
Next it will ask you to choose a drug dosage or to continue with a common dosage. Choose the dosage if you know it.
Then you’ll be given a multi-page list of all the drug plans that cover the drug(s) you inputed. Where it says “Plans per page” choose “ALL” from the drop down list. Look for the plans you know are accepted at the local pharmacy. Make a note of those. Click on the name of each of those plans to see what tier of the formulary the drug is in for that plan; this will be important when you get to Step Five. If you can find a plan with all of your drugs in tier 1 or 2, you’re in luck.
Start this search over with the secondmost expensive drug. When you get through all the drugs, one or two plans should be the obvious winners.
Step Five: Time to figure out which tier of coverage you need. This isn’t the same thing as the formulary drug tier. I’m talking about the cost of monthly premiums. A site that explains this pretty well is:
For many people, tier one (the cheapest monthly premium) will probably work, as long as you find a plan that covers the drugs you are on under tier 1 or tier 2 of the formulary list.
We’ve noticed a trend at the drugstore, but I could be wrong: the people who are on around $7,000 worth of drugs per year seem to save the most with Tier 2 of monthly premiums, and those on over $12,000 worth of drugs per year seem to do best with Tier 3 of monthly premiums. But, I can’t stress this enough, there are no one-size-fits-all ground rules for this. It varies from person to person.
Even if you aren’t on very much, I highly recommend locking in the current monthly premium on at least a tier 1 plan. It’s good, cheap coverage (around $13 per month from some companies). Even a temporary or minor illness can make it worthwhile. I wish I could get prescription coverage that cheap.
Step Six: Give the medication list to your insurance agent and discuss plans with them. If you did step four, you may be comfortable with contacting a specific company directly. It wouldn’t hurt to take the information into the drugstore before you make it final and doublecheck to make sure that plan is taken. Some of these companies have very similar names. Also, keep in mind that some companies are abbreviated strangely at the medicare website. Community Care Rx is abbreviated as “CCRX”. Most pharmacies probably take that plan, but most of us would tell you we take “Community Care”.
Things to keep in mind:
The open enrollment period starts November 15th, 2005. If you sign up any time before January 1st, you’re covered on January 1st. You don’t have to run right out and sign up for something today. You have time. Some time next year (March 15th of 2006, I think) the plans start raising in price 1% per month. If you don’t sign up before then, the plans will cost more. If any saleperson tries to pressure you into signing up immediately because you’ll be doomed if you don’t, they are lying and probably selling you a terrible plan as well.
If an agent is only signed up to sell one company’s plan, beware. If an agent doesn’t even look at your drug list before saying they know exactly which plan is best for you, run like hell. If you go to a local meeting about “explaining Medicare D” and it happens to be run by an insurance company, you can feel free to try to get some questions answered, but, for the love of God, don’t sign up for anything right away. Take the info home. Compare it to something else. If any high-pressure tactics are used, just tell that saleperson, “Shame on you.” You don’t have to sign up right away. You don’t owe them anything for coming to their meeting. An insurance company is going to be holding one of those meetings across the street from the store I worked at. They’re pushing a plan we don’t accept, and think they can strongarm us into losing thousands of dollars if they can pressure enough people to sign up for it. We’re so temped to put up a big sign in the front window on the day of the meeting that says, “Attention people across the street. We DO NOT accept cards from that insurance company, but enjoy the free meal.” If I were still working there, I’d volunteer to make the sign myself. Heck, I still might.
If a company is paying for television ads, Paul Harvey endorsement, representatives to come to your home, etc, that money is coming out of your pocket and the local pharmacy’s pocket, not the insurance company’s. You’ll probably be paying a higher monthly fee for coverage similar to or worse than Blue Cross Blue Shield, and there is a very good chance your pharmacy won’t even want to accept that plan because the insurance company will expect us to dispense the drugs for less than they cost us. We can’t stay afloat any longer under those conditions. The drugstore I used to work at used to have a 1.3% profit margin. For the last several months before I quit the profit margin was negative. The owners were taking money out of their own pocket to keep the store going through a hopefully temporary rough patch. It’s a rural community, average incomes way below the national average, the only store for miles. If they go under because too many people got their Medicare D off a TV ad and strong-armed the store into eating the loss, there will be several people left with literally no access.
Yes, it’s complicated, but please keep something in mind as you complain. The government is giving a small payment-per-user to the private insurers and letting them work out the details. The alternatives are to either have the government pick one company to give preferential treatment to (that would cause an uproar on so many levels) or to have the government fully fund and run the plan by themselves. That would bankrupt the current medicare system in a matter of weeks, and wouldn’t possibly be ready to implement any time soon. So, yes, it’s complicated. But the other realistic alternative is no coverage at all. Don’t look a gift horse in the mouth. I’d strangle that gift horse bare-handed to get drug coverage this good and this cheap for myself. I’m sure a lot of other young people with no drug coverage would. If you have to complain about how complicated it is, don’t do it to that young clerk at the drug store who’s making $6 an hour with no benefits, or to the technician making $10 with no benefits. You’re just rubbing our noses in something we don’t have access to.
If you let the government assign a plan for you, it may not be a very good plan or even a plan taken by any pharmacies near you. It’s a crap shoot. One guy came into the store and showed me what plan he’d been assigned to, and it was actually a plan from one of the six companies we know we’ll take and it was also the best plan for him. My grandma, on the other hand, got a letter that said she was going to be enrolled in Humana. I don’t know of a single drug store within 200 miles of here that takes Humana, because they wanted us to sell every drug for a very huge loss. I heard a rumor that Walmart may be taking those cards because they were able to negotiate a different compensation level, just for themselves. Even if that’s true, grandma doesn’t have a car and couldn’t afford to pay someone to drive 2 hours to Walmart every time she needs a prescription. She’s getting changed over to a different plan now.
As I mentioned before, no one working in the drugstore is allowed to tell you what plan you should take. The government has come down hard on us, telling us if they catch us recommending anyone to a specific plan we’ll be charged with price fixing. We are allowed to say which plans we are or aren’t accepting, but we aren’t supposed to tell a customer what plan is best for them, even if we know exactly what plan is best. Please don’t yell at us for obeying the law. Back when I was still working at the store, there were a minimum of five times every day someone would ask which plan would save them the most money. I could look that up for them. I wanted to. It would set their mind at ease and lead to far less hassle for everyone. But we’re not allowed.
Then again, I did look up online, after hours, which (very few) plans would cover an expensive medication a low-income guy is on. Found two plans that would take his yearly drug costs from about $3000 per year to about $1000, and called him up to tell him so. But that’s completely unrelated to my job, of course. Just one guy calling another guy. Please don’t arrest me. Ah, what can I say? The guy’s always been nice to us, so I fought the law. People who are always nice to us is an astounding rarity in retail pharmacy. Gotta keep that one alive. And, hey, I didn’t tell him which of those two plans to go with, did I? So there. That’s the gray area where I do a touchdown dance.
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