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Seniors Pay Too Much for Medicare Part D

Seniors with Medicare part D coverage will soon face an important deadline.  They have until Dec 7 to choose a new 2013 drug coverage plan.  If they do nothing they will be automatically enrolled in their current plan.  Many don’t realize that their current plans can change significantly from year to year and that other plans more suitable and cheaper are available.  It’s one reason most of the people on Medicare Part D plans pay hundreds of dollars more than necessary for their drug coverage.

Insurance companies offering Part D drug insurance are required to mail information about the coming years  premium costs and drug coverage to current members well in advance of the December deadline.  These hefty documents arrive just ahead of the busiest time of year and, after reading the cover letter stating they will be automatically signed up if they do nothing, many do just that: nothing.  Unlike other types of insurance, Medicare Part D drug coverage changes every year because new drugs, manufacturing costs, regulations and effectiveness findings come out literally every day.  As a result, insurance companies must change their formularies, the list of the drugs they cover and the cost, at least every year.

Whether it’s the lack of awareness or a case of being bewildered and disheartened over the task of reviewing all the information necessary, studies show only 5.2% of seniors  covered by Medicare Part D drug insurance have plans that meet their economic and health needs.  This year, I had first hand experience evaluating plans for an elderly aunt who called me for help.  In the process, we changed drug plans and saved a lot of money.  But I confess, it took some time and I could see how confusing it could be for an older person.  It’s not surprising that individuals over the age of 85 are the ones most likely to be paying too much for their Medicare Part D drug plan.

We started by reviewing the voluminous documents and concentrated on the premium changes, preferred pharmacies and, most importantly, the formulary.  This is a listing of all the drugs that this insurer covers.  We found the premium went down but there was now a deductible.  Going over the formulary, we discovered one brand name drug my aunt needed had been dropped and another, recently prescribed, was missing as well.  This meant my aunt would have to pay the full retail price for these drugs under this plan.

It made sense, at this point, to see if we could find something better by looking at what other drug insurance plans were offering. I found the Find Health & Drug Plans section on the Medicare Part D website a tool that makes this possible.  It does the math for you, taking into account your drug needs, each plan’s formulary and premium costs, and allows you to make side by side comparisons among the plans available in your area.  However, there are many terms, restrictions, and variables that might be confusing for the casual user; and navigating the complicated site would be near impossible for someone without much internet experience.

I was able to help my aunt find a better drug insurance plan but what about the rest of the  32 million people on Medicare Part D?  Each one of them recently received documents  listing changes to their insurance that might result in unexpected higher costs.  Unless a better plan is chosen, those costs will be locked in for the next year.   Luckily, people needing help in finding the best drug coverage can contact a licensed health insurance agent specializing in Medicare.  They are experts at navigating through the maze of premiums, deductibles, formularies, networks and restrictions.  But the deadline is December 7.  The clock is ticking.

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