Looking to Save Money? Start with Rx Costs

Did you know that drug costs rose 12.2% in 2014 alone which is 5 times as fast as the year before? And that the price of the 50 top most-used generic drugs has soared over 373% between 2010-2014? What’s happening and how can we as consumers save money and be savvy about our prescriptions? One thing that’s happening is company mergers, currently leaving 3 companies in control of 40% of the generic drug market. Also, some of the newest drugs are prohibitively expensive, such as the new Hepatitis C treatment Sovaldi which is $1,000 a pill for an 84-pill treatment.

With prices and rising costs like these, it’s no wonder that insurance companies look for ways to shift more costs to consumers and make it harder to receive the higher costs drugs. For example, many drug plans have increased the number of drug tiers in their formulary (covered drugs) from just 2 tiers (one for generics, one for brand name drugs) to 3, 4 and even 5 tiers – with each tier corresponding to higher costs. This makes it confusing for consumers to know what exactly their drug costs will be when comparing plan formularies. Drug plans have also increased the number of drugs requiring step therapy or prior authorization. Such strategies shift rising drug costs to consumers and put up a barrier to receiving the higher cost medicines.

So what are some ways to save money? Money Magazine’s March 2016 edition details some good cost-saving strategies, several of which are summarized below.

  • Change your medication. If you’re taking a brand name drug, ask your doctor for its generic equivalent. Also, if you’re taking multiple medications, see if there’s one medication that can be used for multiple conditions. That option does exist in some circumstances.
  • Use mail-order to fill and refill your prescriptions. You can get a 90-day supply and will generally have a lower copay than if you get a 90-day supply at a retail store.
  • Watch out for online pharmacy scams. According to a 2013 Government Accountability Report, many of the online “Canadian pharmacies” are illegitimate. Some have been found selling drugs with lethal contaminants such as lead or rat poison. If you do use an online pharmacy, make sure the website URL ends in “.pharmacy”. This means the site meets certain regulation requirements and has been approved by the National Association of Boards of Pharmacy.
  • Use your Medicare Part D plan’s coverage determination and exceptions processes to get affordable coverage for the drug(s) you need.
  • Change your insurance. One of the most effective ways to reduce drug costs is to change your drug plan. Medicare Part D drug plans change their coverage every year, and just because one plan meets your drug needs and is affordable one year, does not guarantee it will be the same the next year. During Medicare’s Open Enrollment period (Oct 15 – Dec 7) each year, you have the option to switch plans. Review your plan’s coverage for the coming year and shop around. California’s Health Insurance Counseling and Advocacy Program (HICAP) literally helped clients save millions of dollars this year by helping them find a plan that meets their mediation needs. You can use Medicare’s Plan Finder tool at Medicare.gov. This tools allows you to easily search for compatible plans by entering your medication, dosage, frequency, and preferred pharmacies. The plan finder will then give you a list of plans with your estimated out-of-pocket costs.

See our website for more information on Medicare Part D prescription drug coverage.

Karen Joy Fletcher

Our blogger Karen Joy Fletcher is CHA’s Communications Director. With a Masters in Public Health from UC Berkeley, she is the online “public face” of the organization, provides technical expertise, writing and research on Medicare and other health care issues. She is responsible for digital content creation, management of CHA’s editorial calendar, and managing all aspects of CHA’s social media presence. She loves being a “communicator” and enjoys networking and collaborating with the passionate people and agencies in the health advocacy field. See her current articles.