This fall, because major changes are happening due to the enactment of additional provisions of the Inflation Reduction Act (IRA), we interacted with hundreds of clients to analyze their current insurance status and make adjustments for 2025. If you did not do a review, but want to be sure you maximize your coverage, there still are actions you can take now in preparation for the new plan year that begins January 1. Today, I share some recommendations.
Create online accounts/portals
Medicare Part D Prescription Drug Plans and Medicare Advantage Plans (MAPs) are purchased from private insurance companies. Each has a mechanism for creating an online account/portal. This is where proactive planning begins and where research starts should problems arise. Take the time now to set up your account on the company web site.
Check if your drugs are covered
In general, all Medicare drug plans must cover at least two drugs in the most commonly prescribed categories and classes. Plans can choose which drugs to offer; none of them cover everything. Each plan is required to publish a formulary/drug list of what is covered on their portal.
With both the generic and brand name of your drugs in hand, go to the index in the back of the formulary and look for each one to see if it’s covered. (In addition to the formulary, most portals have a look-up tool for searching.) Throughout the year, any time you and your physician consider adding a new drug, use the portal to make sure from the start that it is covered.
Provided they follow guidelines set by Medicare, plans may change their formularies during the year. Although they may notify you of these changes, it can come as a big surprise and certainly requires taking action.
Note that while still on the formulary, some drugs require a prior authorization, a process that is initiated by your physician, who must substantiate a clinical need.
Check your pharmacy
As with accessing care from physicians and hospitals, purchasing your drugs from an in-network pharmacycan make a big difference in their cost. So be sure to check on your pharmacy’s participation with your plan.
The portal has a look-up tool for this purpose as well. Most plans consider at least one large chain pharmacy as in-network. But not all, so be careful of your assumptions. Smaller pharmacies vary greatly in terms of participation. If your pharmacy is not considered in-network, and especially if you take an expensive medication, you may need to make a change.
Identify the cost of your drug
Your portal specifies the tier of your drug and, therefore, what your copay (a set amount) or your coinsurance (a percentage of the retail cost of the drug) will be. It also tells whether your drug is applied to your deductible, something that affects what you pay, both before and after you meet it.
If your drug is in a higher tier and your physician thinks you need that drug instead of a similar drug in a lower tier, you or your physician can ask your plan for an exception. If granted, this can lower the coinsurance or copayment for the higher tier drug.
Drugs not on the formulary
If a drug is not covered, there may be a link that identifies alternative medications. Download the content so you know what is covered when speaking with your physician about other options (you don’t want to obtain a prescription for a different medication, only to find that it, too, is not covered). Your physician can evaluate your clinical status and decide.
If you and your physician determine that changing the drug prescribed is not the best alternative, you can ask the prescription drug company for a formulary exception. Your portal will provide information about this process and it is important you understand it as you may be following up on more than one occasion if things don’t go as planned.
Your physician must initiate the first step; there is often a designated professional in the office who takes responsibility for these actions on behalf of patients. Ask for the name of that person to ensure the process is completed.
The process requires that your physician provide medical documentation regarding the clinical need, alternatives already tried, allergies, etc. If the exception is approved, you will be notified by mail of the time frame for which it is in effect (usually one year).
The letter will outline the tier in which the drug was placed, which will determine your out-of-pocket cost. Although it may still be high, it will definitely be an improvement over the retail cost. Unfortunately, with a granted exception, the out-of-pocket cost does not accrue toward the $2000 out-of-pocket cap described below.
Medicare Prescription Payment Plan
For pharmacists, a new responsibility this year is to have a discussion with customers about the new Medicare Prescription Payment Plan (another component of the Inflation Reduction Act).
In short, this voluntary program allows individuals to manage the out-of-pocket cost of expensive drugs by spreading the payments over the course of the year, rather than paying for most of that cost up front until deductibles are met.
With this program, you will continue to pay your plan premium to the insurance company and, in addition, you will receive a bill from the plan to pay for your prescription drugs (instead of paying at the pharmacy).
You can sign up for this program via your portal or by calling customer service. Although you can enroll at any time during the year, doing so now will smooth payments evenly across the months.
If you are not computer savvy!
If you are not inclined to use a portal (like my 89- and 90-year-old parents), feel free to contact customer service over the phone. Or, as my dad often does, ask a loved one for help.
Summary
The news is filled with stories about our complex and expensive healthcare system. Although I wish it were easier to manage, it is a reality we all must confront. As we always advise here at Healthassist, take control as best you can by remaining educated, proactive, and persistent.