New drug cost picture for seniors in Medicare Part D

[TheWorldNewsOrg]

I had to learn a new term while reading this article. "Coinsurance".   (Distinct from "Copayments")

a couple quotes:

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Shannon said the shift toward coinsurance requirements for many Medicare Part D drugs will mean that customers will have "a lot of work" to do in evaluating drug plans, by checking to see if a plan subjects medication to coinsurance, and to what extent.

"As coinsurance becomes more common in Part D plans, consumers will find their drug costs are less predictable and will need to rely more on tools like the Medicare Plan Finder to help estimate out-of-pocket costs," Shannon said. The shift to coinsurance "could lead to significant changes year over year in what patients are paying out of pocket."

 

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Quote

 

Medicare Part D plans typically sort their covered drugs into five tiers, with different rates of cost sharing for each tier. This system is designed to encourage customers to use lower-cost drugs, and to help health plans negotiate better rebates from pharmaceutical companies in exchange for placement of their drugs on lower tiers.

Historically, Avalere's report noted, most plans applied coinsurance requirements to the specialty drug tier, which covers higher-priced medications. 

But in the past several years, coinsurance has been increasingly applied to drugs in lower-priced tiers, including preferred and nonpreferred brand tiers, the report said. 

Shannon said it can be "startling to people" to see coinsurance applied to lower-priced drugs. 

Medicare rules require plans to charge coinsurance rates of no higher than 33 percent for drugs in the specialty tier. But the maximum coinsurance rate is 50 percent for nonpreferred brand tiers this year. 

He said that about 11 million people enrolled in Medicare Part D plans have incomes low enough that they get federal subsidies to cover their out-of-pocket drug costs, which will mean they won't feel all or more of the effects of the shift to coinsurance requirements. 

But the remaining beneficiaries will be likely to see the effects, he said.

 

http://www.cnbc.com/2016/03/10/new-drug-cost-picture-for-seniors-in-medicare-part-d.html