Over the last month we've received phone calls from clients expressing concerns they are paying significantly more money for prescriptions this year than they have in the past.
As we researched these questions we found these clients are being impacted by two big trends in the Medicare prescription drug world. Namely: More prescription drug plans now have an annual deductible in 2016 than in the past. This means our clients are now paying the full costs of their medications at the beginning of the year, instead of paying a modest copay.
In fact according to an October 2015 article found at kff.org tow thirds of all PDPs now have deductibles. To see the entire article select this link: http://kff.org/medicare/issue-brief/medicare-part-d-a-first-look-at-plan-offerings-in-2016/
The other trend : Rising drug prices. The following was copied from a Wall Street Journal article October 5, 2015:
The moderating price effect from generics now is tapering off. Pharmacy-benefits manager CVS Health Corp. said drug spending by its customers jumped 12.7% last year, more than triple the prior year’s rise.
Price boosts represented more than 80% of this increase, CVS said.
Similarly, Medicare’s spending on its prescription-drug benefit rose 8% last year on a per capita basis, after several years of averaging less than 1%. A leading reason for the surge was “price increases for both brand-name and generic drugs,” Medicare’s board of trustees said in a recent report.
The Journal examined 30 of last year’s top drugs by revenue that are sold by U.S. pharmacies, looking at data from the start of 2010 through the end of 2014. The analysis used corporate financial statements, prescription figures from IMS Health Holdings Inc.and wholesale-pricing data provided by Truven Health Analytics. It excluded drugs that weren’t yet on the market in 2010 or for which full data weren’t available.
For 18 of these 30 drugs, both revenue and the number of dispensed prescriptions for them rose. But revenue rose twice as fast as prescriptions.
However, one thing has remained constant since the introduction of Medicare prescription drug plans (PDPs).
Everyone can and should take advantage of the annual enrollment period to review all available plans to find the one that provides the right coverage for your prescriptions.
Thanks for visiting,
Lonnie Thibodeaux is the owner of Sargent Insurance and Financial Services. He specializes in Medicare health plans and prescription drug plans.