Take Charge of Your Health Care

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New Rule No. 4

It's worth your while to pay attention to those little pills.

The days when you get a prescription and just head straight to the neighborhood pharmacy are fading. Prescription drug spending now makes up 10% of health-care costs - and is rising.

Not surprisingly, health plans are not only pushing you to take cheaper pills, they're increasingly trying to dictate where and how you buy them. At the same time, with costs to consumers zooming, big retail chains have spotted a market opportunity and have dramatically cut prices on some popular drugs.

Take charge. It's tempting to ignore all the mail your insurer sends you about plan changes. But it's worth your time to check out the latest rules on prescriptions. It can save plans money if you buy prescriptions directly through a pharmacy benefits manager. (That's the company listed on your insurance or prescription card.) That's why many plans now penalize you for using a brick-and-mortar pharmacy. A 90-day supply of one prescription may cost $15 less through the mail from the benefits manager.

Plans often charge different co-pays for different pills, so ask your doctor if she is familiar with your plan's rules and is offering you the least costly - but still effective - option.

You may also be able to search your insurer's website to find out whether there are generic or other alternatives to the medication you've been prescribed. (In many plans your pharmacist has to give you a generic unless your doctor indicates otherwise.)

Retailers including Wal-Mart and Target recently began offering many generic drugs for as little as $4. To start comparing prices, go to your plan's website or drx.com to search for the lowest price for your drug and dosage. The sites will list retail prices from brick-and-mortar stores, online sellers like Costco.com and perhaps even your benefits manager.

New Rule No. 5

You can get more out of Medicare.

Think your employer's health plan is complicated? Just wait until you hit 65. Medicare has undergone some sweeping changes. In 2006 the system began offering prescription drug coverage - the catch is that you have to choose from among dozens of privately run plans.

You can also opt out of traditional Medicare coverage and join a private Medicare Advantage plan. "There's a lot of choice now, and that's a good thing," says Medicare expert Sarah Thomas of AARP. "But it may be a little overwhelming."

Take charge. Medicare prescription plans have an additional monthly cost on top of the regular Medicare premium. And they don't cover everything: There's sometimes a deductible, as well as the notorious "doughnut hole." For example, you might not be covered after total drug costs hit $2,510, though Medicare will step back in and cover you once you've paid $4,050 out of pocket.

So how do you pick? If you're healthy now and aren't taking a lot of drugs, find a plan with a low premium, suggests Thomas. You can switch once a year. If you do have hefty prescription costs, make sure the pills you take are included on a plan's preferred-brand list.

Medicare Advantage plans replace the Part A and Part B coverage most retirees still use. By joining a private plan, you can pay lower co-insurance fees and perhaps get extras like dental coverage or insurance when you travel abroad. Some plans also include prescriptions. What you may lose: the right to go to any doctor or hospital you want. So if you are considering an Advantage plan, make sure your doctor and preferred hospital are in its network.

If you have significant health problems, watch out for plan restrictions that hit sicker patients harder. For example, some plans have steep co-pays for the first 20 days in a nursing home. A free national program offers one-on-one assistance with Medicare choices - visit shiptalk.org.

Once you figure it all out, don't get too comfortable. As long as health costs keep rising, the rules will keep on changing.

Are you on track for an early retirement? Tell us why at millionaire@cnnmoney.com. Include your financial details and your family could be profiled in a future column of our Millionaire in the Making series.

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