Helping your clients with Medicare Part D coverage understand the mechanics of the Medicare Part D coverage gap can be a daunting task. We are going to cover a couple of the more difficult questions raised regarding the coverage gap in this segment.
The main concern of Medicare beneficiaries who reach the coverage gap is knowing what they will be required to pay for their prescriptions once they've reached the gap. For 2015, beneficiaries in the coverage gap will be required to pay 45% of their Part D plan's cost for brand-name prescriptions and 65% of Medicare's cost for generic drugs.
Medicare beneficiaries also often want to be reassured that their prescriptions are eligible for the discounts while in the coverage gap. Obviously if the brand-name or generic drug was covered in the initial coverage period, then it will qualify for the discounted rate if purchased again while in the gap. If the beneficiary is prescribed a new medication after entering the gap, the new med will also be eligible for the discount if it is on the Plan's formulary or if it is being covered on appeal. Note also that the full price of brand-name drugs will be counted towards the amount the member must reach to qualify for catastrophic coverage, not just the discounted amount paid for brand-name drugs. As for generics, only the amount paid for the drugs will count towards the amount required to reach catastrophic coverage.
Here's an example: John Smith has just entered the coverage gap for 2015. He goes to the pharmacy to fill one brand-name prescription for which his plan would normally pay the pharmacy $120. He also has to fill one generic prescription for which his plan would normally pay the pharmacy $20. The pharmacy requires Mr. Smith to pay $54 ($120 x 0.45) for the brand-name drug and $13 ($20 x .0.65) for the generic medication for a total of $67 for both drugs. $133 ($120 + $13) will be counted towards the amount required to bring Mr. Smith through the gap and into catastrophic coverage.
If you'd like to have something to show your clients, or to study for yourself, CLICK HERE for a CMS paper called "Closing the Coverage Gap - Medicare Prescription Drugs Are Becoming More Affordable."