With each new year, we see many new changes in health insurance plans, especially Medicare Part D coverage. Every year, Medicare adjusts the list of prescription drugs, healthcare products, and services they will pay. This revised list is released several months in advance to give Medicare Part D recipients, health care providers, and caregivers time to adjust.
We now have a good idea of what drugs are covered by Medicare Part D, and what drugs will not be covered in the coming months for 2019. In this article, we will discuss some of the most significant changes that you should know.
The Centers for Medicare and Medicaid Services, also known as CMS, released the new details for the changes which will take place in 2019 on April 2, 2018. These details include information on new deductible amounts and coverage limits, brand-name and generic prescription drug discounts, increased out-of-pocket costs, and how these changes for 2019 will affect the Medicare coverage gap.
The President signed the Bipartisan Budget Act of 2018 in February 2018. This change will affect everyone who is covered by Medicare Part D. While some of these changes will provide money-saving discounts for some recipients, others will see a rise in their out-of-pocket costs.
There will be a slight increase in the standard initial deductible, which is currently at $405. That amount is set to increase up to $415 in 2019. This amount has been on a steady rise since 2015 when it was at $320. This deductible is the amount an individual pays before their Medicare Part D coverage begins.
Medicare Part D recipients will also see an increase in their initial coverage limit. In 2018, the limit is at $3,750. This amount is set to increase up to $3,820 in 2019. This increase will allow individuals to compensate for the rise in the cost of their medication before they reach the coverage gap, also known as the “donut hole.”
For Medicare Part D plan members who take generic prescription drugs, the cost of your medication will be less once you reach the donut hole. In 2018, the generic drug discount for Medicare recipients was at 56 percent.
This discount will go up to 63 percent in 2019. This discount applies to any generic prescription. All out-of-pocket costs that you pay out, apply to your out-of-pocket spending limit for the year. Once you reach that limit, you will leave the donut hole.
Along with receiving a money-saving discount on generic drug purchases, Medicare Part D recipients will also get a discount on any brand-name drugs that they are on. The coverage gap discount is set to increase to 75 percent off brand-name medication.
With this increase, you will only be required to pay 25 percent of the cost for brand-name prescriptions. Moreover, although you will only pay for a quarter of the prescription cost, 95 percent of the price of all brand-name drugs you take will be applied to your out-of-pocket spending limit for the year.
The Donut Hole which has been around since Medicare Part D began back in 2006, was initially created to keep down the overall out-of-pocket costs for Medicare recipients and the federal government.
But for those on Medicare who rely on brand-name prescriptions, it has been more of a disadvantage than a benefit. Beneficiaries were forced to choose between paying for expensive medication that worked well or paying less for medication that wasn’t as useful for treating their health condition.
Under the new budget plan for 2019, Medicare will continue to pay for 75 percent of the cost of brand-name drugs until the recipient reaches their catastrophic limit. Once that happens, the donut hole will close and then require the drug manufacturers to take on the majority of the cost. Again, leaving the beneficiary only paying 25 percent.
As with every new year, the changes in Medicare Part D will benefit some and be a disadvantage for others. However, these new changes are expected to provide those who depend on expensive brand-name medication with a significant discount on their out-of-pocket expenses.
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