BELLEVILLE, IL--(Marketwired - Nov 4, 2013) - A number of changes affecting prescription drug Part D plans signal important reasons for seniors and people with disabilities relying on Medicare to review coverage during the annual open enrollment, according to Allsup, a nationwide provider of Medicare plan selection services.
"This year includes some significant changes in prescription drug Part D plans, so it's important that Medicare participants examine their options closely," said Paula Muschler, operations manager of the Allsup Medicare Advisor®. This is a Medicare plan selection service offering personalized help that includes customized research and enrollment assistance for Part D plans and other Medicare plan options.
Among the changes are plan costs, plan drug coverage changes, changes to the donut hole, and new plan options and benefit parameters.
In addition to changes in existing plans, more than 200 new Part D plans are being offered this year, Kaiser Family Foundation1 reported, while nearly 50 plans left the market. "Anytime a Part D plan closes down, Medicare participants who were in that plan have a valuable opportunity and should take advantage of this change to study their options. They may have some great new plans to choose from for 2014," Muschler said.
For example, the average number of stand-alone Part D plans increased for 2014, with an average 35 plans now available to beneficiaries, according to Kaiser. "Thirty-five plans is a lot of information to sort through. Part D plans also can change from year-to-year, in terms of their drug formularies and other provisions -- so it can get complicated pretty quickly," Muschler said.
The following are significant changes for prescription drug coverage in 2014.
Changes in Medicare Part D Plans, Premiums
- The Part D base beneficiary premium is $32.42 in 2014, which is close to a 4 percent increase from $31.17 in 2013.
- As cited earlier, 212 new Part D plans enter the market and 46 plans leave the market.
- More insurers are featuring Part D plans with preferred pharmacy networks, where the plan provides cost discounts for using that specific pharmacy chain.
- New for 2014 is the small-supply drug option. Medicare Part D participants typically received coverage for a one-month supply of medication. Starting in 2014, though, individuals can ask for less than a one-month supply for most types of drugs. "This may seem like a small change, but it's a valuable option for patients and their doctors who want to conduct a shorter trial on a medication, rather than having to purchase a month's worth of medication," Muschler explained.
Donut Hole Changes
- There will be changes to the prescription drug "donut hole." The donut hole is the gap of coverage when the beneficiary pays a greater portion of their drug expenses. The initial coverage limit will be $2,850 (vs. $2,970 in 2013), and the out-of-pocket threshold is $4,550 (vs. $4,750 in 2013).
- Medicare Part D participants who reach the donut hole will pay less for their generic prescriptions next year. Their share of brand-name drug costs stays at 47.5 percent, but they will pay less for generic drugs at 72 percent in 2014 (vs. 79 percent in 2013).
- None of the standalone Part D plans offered in 2014 will offer full coverage during the donut hole.
The impact of these changes will vary depending on the individual -- but the donut hole is one example. Overall, it will be $80 smaller in 2014, but because the initial coverage limit ends at $2,850 vs. $2,970, more people could end up in the coverage gap sooner.
Nearly 2.8 million people reached the donut hole in the first nine months of 2013, an increase of nearly 22 percent compared to last year. About 2.3 million people reached the donut hole during the first nine months of 2012, according to the Centers for Medicare & Medicaid Services.
Reason To Switch Part D Plans
For those who aren't certain whether they should change their Part D coverage, the following are some reasons to consider:
- Part D plan costs change. Costs for prescription drug coverage include the premium, deductible, and co-pays or coinsurance. Medicare participants may be able to reduce costs by comparing their options and switching to a new plan.
- Drug formularies (drugs covered by the plan) change. Beneficiaries should ensure their necessary medications are still covered. In addition, they may find coverage at a lower cost by comparing plans.
- Part D plans leave and enter the market. Participants may find they have to choose a new plan because their current plan will be closing. New options also may be offered that provide coverage and cost that are a better match for someone's health and financial resources.
- Individual health changes. Someone who has experienced an injury or new condition may find their current plan is more costly than an alternative offered in their area.
- Preferred pharmacy plans expand. There may be some additional cost savings by taking advantage of discounts offered through a preferred pharmacy plan that's now available in someone's area.
"Medicare participants still have several weeks to review their Part D plans and make a selection for 2014, and they may find significant cost and health benefits by seeking help from a Medicare specialist like Allsup," Muschler added.
Medicare beneficiaries choosing to switch plans have now through Dec. 7 to complete Medicare plan selection and enrollment for insurance coverage that takes effect Jan. 1, 2014.
For an evaluation of Medicare options, call an Allsup Medicare Advisor specialist at (866) 521-7655 or visit Medicare.Allsup.com to learn more about the service.
The Allsup Medicare Advisor also has features that help financial advisors guide their clients to the Medicare plans that match their specific lifestyles and healthcare needs. Employers also use Allsup Medicare Advisor for their employees who are retiring and transitioning to Medicare. For more information, go to FinancialAdvisor.Allsup.com, or call (888) 220-9678.
1 - October 2013. Kaiser Family Foundation. "Medicare Part D: A First Look at Plan Offerings in 2014."
Allsup is a nationwide provider of Social Security disability, veterans disability appeal, Medicare and Medicare Secondary Payer compliance services for individuals, employers and insurance carriers. Allsup professionals deliver specialized services supporting people with disabilities and seniors so they may lead lives that are as financially secure and as healthy as possible. Founded in 1984, the company is based in Belleville, Ill., near St. Louis. For more information, go to http://www.Allsup.com or visit Allsup on Facebook at https://www.facebook.com/Allsupinc.
The information provided is not intended as a substitute for legal or other professional services. Legal or other expert assistance should be sought before making any decision that may affect your situation.