Q: I just went to pick up my mom's prescription medication at the pharmacy and the amount we had to pay was much higher. Is her insurance still working? Do we have to show our cards again?
A: I am concerned that I will be getting this particular question a lot this year. There are a number of different reasons for higher prescription co-pays at the beginning of the year. Let me run through some scenarios and maybe that can help you figure out what is happening.
I am first going to assume you kept the same the insurance company from 2011 to 2012. Each year the insurance companies change their plans some. It may be they increase/decrease their deductible, increase/decrease their co-pays, increase/decrease their premium, change their formularies (the drugs they cover and how they cover them). All these changes potentially lead to different costs for people who ''thought'' they had the ''same'' insurance.
If your Prescription Drug Plan (PDP) stayed the same and has a deductible, you paid more because you are in a new year and you pay full cost for your prescriptions until the deductible has been met. So if the deductible is $150 you pay full price until $150; if the deductible is $320 you pay full price until $320. Once your deductible is met (you have paid that much in costs), you then see a reduction in your co-pays. The initial coverage begins when the insurance company pays part of the cost of your medication. The standard PDP pays at least 75 percent of the prescription drug costs; meaning you pay 25 percent. Many PDPs have a set amount for co-pays, like $5, $45 or $90.
If your plan doesn't have a deductible you may be paying more because the prescription drug you picked up at the pharmacy has moved to another ''tier.'' Each PDP puts all the prescription drugs they cover into a series of tiers. These tiers are numbered: 1, 2, 3 and so on. This tiering also influences the cost. Most plans and medications increase the costs as the tier numbers increase. Some plans have Tier 1 at $0 (zero) co-pays; some plans have Tier 1 at $10. So you do not necessarily know what it will cost based on the tier it is listed in, as compared with what it was last year OR from one company to another company.
Your insurance company has sent you their Formulary Book and that describes the tiering of each of the medications. So I would recommend pulling out your Formulary Book and looking to see what Tier your medications are on this year. That will help to determine the costs you should be paying. Once you know the Tier your medication falls into, you know how much it should cost.
Fact Box
As individuals retire or age into Medicare, their insurance situation can change dramatically. There are a multitude of options open to those with Medicare. The terms are different, the prices are different, the products offered are dramatically different each year.
The purpose of this column is to give those who are eligible for Medicare, or soon to be eligible for Medicare, some understanding of their insurance options and how it could impact their health and finances.
These questions and answers are meant as a guide to help you understand the complex questions you are now thinking about. Each individual's specific situation may create a different solution. You shouldn't necessarily do what your friends, family and neighbors do.
Some of the PDPs for 2012 have adjusted their co-pays to be different depending on the pharmacy you use. We have not seen too much of that in prior years, but this year a number of companies are doing this. If you go to a ''Preferred-Network Pharmacy'' a Tier 1 medication would cost $1; if you go to different pharmacy you could pay $10 for that same medication. Your PDP has also given you information regarding Participating Pharmacies. This would be another resource you could use to see if your co-pay increased because of the pharmacy you are currently using. Switching to a network pharmacy could save you significant money over the course of the 2012 year.
I also know that many individuals will be paying more in 2012 because of the changes to EPIC. I know I have talked about it a lot, but feel it is important to mention here.
In 2012 EPIC will only help to reduce the co-pays you pay when you reach the coverage gap with your Part D plan. So in 2011 when you filled your medications in January your Part D coverage had your co-pay set at $10 for your Tier 1 medication and then EPIC made that final cost to you of $3. In 2012 EPIC will not help pay for that medication co-pay in January because you haven't yet reached the coverage gap. That means your co-pay will be $10.
I see this scenario as being the number one reason for paying more for your medications in 2012.
Some people will be in a different situation all together. Some individuals will see their cost go up because they are no longer eligible for Medicaid or a Low Income Subsidy (LIS). These individuals may have paid as little as $1, $2.30 or $6.50 for their medications last year. This year they will see their co-pays increase to the amount of $10, $45, $90 or more. This could be quite a shock. If this is the case you can reapply for those entitlements. Once approved or eligible for this benefit your co-pays would again go down to the lower amounts.
In a future article I will be reviewing some other options to help with higher prescription co-pays. I know that many seniors and families tell me they worry when approaching the pharmacy to pick up medications. They often tell me they don't understand why they pay what they pay. My response is that much of our insurance coverage is now computerized. That means that data is put into a computer and then the answer comes back out. If the correct data is put in the correct answer comes out. It is important to review your receipts, and your monthly reports from your insurance companies. By looking at these two items you may catch errors in billing and payments that could impact you financially. So don't just throw those things away. Look at the information and make sure it matches and is correct to what you know to be true. This review by you could save you some money in the long run.
Janell Sluga is a geriatric care manager certified and works for Senior Life Matters, a program of Lutheran Senior Housing, and has worked in Chautauqua County with seniors for more than 18 years. She is HIICAP (Health Insurance Information, Counseling & Assistance Program) counselor-trained by Office for the Aging. She does not sell insurance or represent any insurance company. She is an unbiased source of insurance and education to help seniors choose the best option for them.
You may submit questions to be answered in later columns to Janell Sluga at Senior Life Matters, 737 Falconer St., Jamestown, NY 14701, or call 716-720-9797, or by email at janells@lutheran-jamestown.org. Please remember that not all questions can be answered in this format, but as many as can be, will be.