Advocates statewide are receiving more calls as more beneficiaries reach their coverage gap in their Part D plans. Although the Centers for Medicare and Medicaid Services (CMS) recently released tip sheets on navigating this coverage gap (also known as the ‘donut hole’), some of the information and tips are misleading and inaccurate (see links below to tip sheets). For example, CMS states that to avoid the coverage gap people can switch to generic drugs or make sure to enroll in a plan that provides coverage during the gap. Yet, taking generics is not an option for everyone, and according to advocates, few plans actually provide coverage during the gap.
The tip sheet claims that only 28% of people with Medicare are in a plan with a coverage gap and that the other 72% have no gap in coverage. However, among Part D prescription drug plans (as opposed to employer-based or other plans that provide prescription coverage), only 15% of stand-alone plans and 24% of managed care plans actually offer some type of prescription drug coverage in the gap (L.A. Times, 7/2/06). In addition, the plans that offer some type of coverage in the gap tend to be more expensive by charging higher monthly premiums. “Of all the plans claiming to offer help during the donut hole in Sacramento County, only one of them actually offers help but only for generics,” said John, counselor for the Health Insurance Counseling & Advocacy Program (HICAP). “What good are generics if you must take brand name drugs that have no generic equivalents available?”
In addition, the CMS tip sheet claims that people with Medicare who are in the coverage gap can get the same discounted price on their medications that their Part D plan pays. These costs only “count,” however, if a person continues to buy prescriptions from pharmacies that are in their Part D plan’s network. “In other words,” according to David Lipschutz, California Health Advocates Staff Attorney, “if someone finds a cheaper price for a drug at a non-network pharmacy, that person is free to purchase that drug, but it will not generally count towards their plan cost-sharing amounts that would get them through the donut hole.” Further, the tip sheet fails to note that while Part D enrollees continue to pay premiums for their plans while in the coverage gap, the amount spent on premiums does not count towards their cost sharing thresholds
The tip sheet also lists the types of coverage that can count towards a person’s out-of-pocket costs during the coverage gap and types that cannot. Unfortunately, one of the biggest helpers for beneficiaries in receiving needed and expensive drugs — Patient Assistance Programs (PAPs) – do not count towards an individual’s countable expenses. “These programs are essential for enabling thousands of people with cancer, AIDS, Multiple Sclerosis or other serious illnesses to receive the medication needed to recover or prolong their lives,” says Wen Daniels, California Health Advocates Community Outreach Coordinator. “Many people taking these drugs cannot afford to pay for them themselves during the coverage gap, and may be forced to stop treatment without the assistance of a PAP,” states Daniels.
While switching from brand name to generic or other lower-cost drugs is not an option for everyone, the Consumer Reports’ Best Buy Drugs project can help individuals lower their out of pocket costs while in the donut hole by identifying drugs that cost less but are just as effective and safe. A recent analysis found that seniors taking five commonly prescribed drugs — for high cholesterol, high blood pressure, heart disease, arthritis pain, and depression — could save between $2,300 and $5,300 a year under various Medicare Part D insurance plans by switching to the effective lower-cost medicines drugs identified as Best Buys on the www.crbestbuydrugs.org.
The local Health Insurance Counseling & Advocacy Program (HICAP) which offers individualized guidance to people with Medicare and their families can be reached by calling 1-800-434-0222.
- Tip Sheet – Information Partners Can Use on: How the Coverage Gap works for People with Medicare Prescription Drug Plans (download PDF)
- Tip sheet for Medicare beneficiaries – “Bridging the Coverage Gap” (download PDF)
- Website for Patient Assistance Programs