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Medicare Part D and Prescription Drug Changes in 2018

8/23/2017

12 Comments

 
Picture
Medicare Part D Changes Annually

Each year, Medicare changes the benefits provided under Medicare Part D.  These changes will most likely impact your annual costs for your Prescription Drug Coverage.  Specifically in 2018, here are some key changes for Medicare Part D.

  • Initial Deductible: will be increased by $5 from $400 in 2017 to $405 in 2018.
What does this mean for you? The initial deductible is the ‘first dollar’ spent on your prescriptions.  Certain plans will have a $405 deductible, which means that the individual will have to pay their first $405 in drug costs before the benefits start.  Other plans may offer a $0 deductible, which means that the benefits start immediately.

  • Initial Coverage Limit:  will increase $50 from $3,700 in 2017 to $3,750 in 2018.
What does this mean for you?  The initial coverage limit protects individuals from the dreaded “Donut Hole” (aka Coverage Gap), which results in higher out-of-pocket costs.  After the total retail drug cost exceeds the initial coverage limit, the individual will fall into the Donut hole.
 
By increasing the initial coverage limit by $50, this is a minor improvement which lowers the probability of reaching (or delays the timing to reach) the donut hole , which is a good thing.
​
  • What you Pay in the Donut Hole: for Brand Name drugs, this will reduce from 40% in 2017 to 35% in 2018.  For Generic drugs, this will decrease from 51% in 2017 to 44% in 2018.
 
What does this mean for you?  The cost sharing % an individual has to pay continues to drop each year until we plateau in 2020 at 25% cost sharing for both Brand name and Generic Drugs.  In theory, this is a great thing since the % of cost sharing to the individual continues to drop each year.  In practicality, the retail cost of Prescription Drugs continues to rise at a significant rate which tends to offset the savings anticipated with the annual improvements to the Donut Hole.
 

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​See this link for more details on changes in future years to the Donut Hole.

https://www.medicare.gov/part-d/costs/coverage-gap/more-drug-savings-in-2020.html
​
  • ​True Out-of-Pocket (TrOOP) Threshold: will increase from $4,950 in 2017 to $5,000 in 2018.​  
What does this mean for you?  In most cases, this won’t have an impact.  Less than 10% of people actually reach this threshold.  Catastrophic coverage benefits start when someone exceeds the Out-of-Pocket threshold. 
 
In Catastrophic coverage, individuals will pay a much lower fee for their drugs – either 5% of the drug cost or a specific co-pay amount, whichever is greater.
  • Generic Copay in Catastrophic Coverage– increasing from $3.30 in 2017 to $3.35 in 2018
  • Brand Name Copay in Catastrophic Coverage – increasing from $8.25 in 2017 to $8.35 in 2018
 
By increasing the Out-Pocket threshold by $50, this will have a minor impact on the length of time an individual will remain in the donut hole before exiting into the Catastrophic coverage.
 
All of these Medicare Part D changes in 2018 will have an impact on selecting the right Prescription Drug Card.
 
 
Prescription Plan Part D Changes Annually
In addition to the Medicare Part D changes, the insurance companies change their Prescription drug plans each year.  These changes could impact the formulary (which drugs are covered), deductibles, premiums, etc.
 
It is imperative to select the right plan EACH YEAR to avoid the type of mistakes which could result in thousands of dollars of unnecessary costs!
 
There are about 25 Medicare Part D Prescription plan options in each state, and we strongly recommend using the tools on medicare.gov and/or contacting a trusted insurance broker to assist in this process.
 
 
A FREE Service offered to our clients…
We feel very strongly about ensuring our clients have the correct Prescription Drug Card and thus, we provide the option for all of our clients to have their Prescription Drug coverage reviewed annually.  
 
Click Here to Find out more about our FREE RX Analysis program.
12 Comments
Sorin Weissman
8/17/2017 02:16:34 pm

Please keep me informed of any changes.

Reply
Justin Lubenow
8/17/2017 02:23:01 pm

Hi Sorin,

Yes we will continue to keep all our clients (and newsletter subscribers too) informed!

Have a great day!

Thanks,
Justin

Reply
Lona Alexis Duboi
2/17/2018 11:34:20 pm

Navigating the part D plan is confusing.I thank you for your step by step walk through

Reply
Justin Lubenow
2/18/2018 06:35:07 am

Hi Lona,
I am glad you found the article helpful. Hope you have a great day!
- Justin

Ginny Rees
9/6/2017 01:15:26 pm

I am very upset to be told that the cost of Spiriva has jumped drastically to over $100/mo! Why was I not advised of this when I signed up for coverage? There is no way I can squeeze that much out of my SS check along with the rest of my expenses. If I don't take this RX I will be put in a position of not breathing properly and whatever consequences this will carry. Please help!

Reply
Justin Lubenow
9/6/2017 01:21:39 pm

Hi Ginny,
Yes, Spiriva is an expensive medication (~$300/month retail cost), so you may have hit the donut hole which requires you to pay 40% of the cost for brand name drugs in 2017. I have other blogs and videos that explain the donut hole but I would be happy to discuss with you. Additionally, there are state assistance programs that can help with Part D premiums and drug copays, depending on your income. You can give me a call to discuss further - 908-272-1970

Reply
Ginny Rees
11/21/2017 09:58:19 am

Very disconcerting. Thank you for the explanation ~ I overlooked that damn “donut hole”. Wouldn’t it be nice (for everyone) if medical coverage actually COVERED what it should? God bless America, but not it’s greedy politicians. 👎🏻

Reply
Ginny Rees
11/21/2017 10:09:35 am

I have unsuccessfully tried to find help for RX assistance and seem to make “too much” to qualify.

Reply
Justin Lubenow
11/21/2017 10:31:49 am

Hello Ginny,

Sorry to hear that you were not able to qualify for Rx assistance.

I hope you have a Happy Thanksgiving!

Reply
Ginny Rees
11/21/2017 12:24:04 pm

Do you really think that helps.?....not so much. One needs to be destitute or very well heeled in the US to be able to get by.

Financial Network Insurance Agency link
7/22/2019 02:37:09 pm

With Insurance we know that Price Counts, Coverage Matters.
We utilize the latest technology to have the insurance company compete for your business. We are often able to find you the best price and the best Insurance coverage.

Reply
Richard Springer link
1/7/2021 02:00:48 am

Great read thank yyou

Reply



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  • Home
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    • Medicare Supplements & Medicare Advantage >
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        • Plan F (2022)
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      • Medicare Supplement - Plan G >
        • Plan G (2022)
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      • Medicare Supplement - Plan N >
        • Plan N (2022)
        • Plan N (2023)
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  • Workshops
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  • Medicare FAQs
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  • Medicare Minute