Before 2006, people on Medicare had nearly no assistance with prescription drug coverage for over 50 years. When the Medicare Modernization Act implemented Medicare Part D, tens of millions of beneficiaries enrolled in the program and found substantial savings for their prescription drug needs.
Medicare Part D, however, is a voluntary program, and every year, there are scores of clients who choose not to enroll even after the risks have been explained to them. Since our agency has helped thousands of clients with their Medicare-related insurance decisions, we’d like to share a recent story with you that may demonstrate why Part D coverage is so important.
In 2011, one of our longtime clients contacted us about a Part D dilemma she had found ourselves in. Although she had met with us about her coverage and heard our annual recommendations about why Part D is so important, she had been a very healthy person all her life. She just couldn’t bring herself to spend $15 – $30/month on a Part D drug plan when she had no need for any prescription drugs at that time. Year after year, she declined to enroll in Part D during the annual election period that runs from October 15th – December 7th.
In September of 2011, she was diagnosed with cancer and prescribed an oral cancer medication called Gleevec. This medication needed to be started immediately as it was potentially life-saving for her. Because she declined Part D coverage, she had no choice but to pay for the medication out of pocket. The cost of a 30-day supply was $5,600/month. When she called our office, she said, ” I finally understand what you have been trying to warn me about all these years.”
The good news is that she had saved diligently for her retirement and was able to to pay for the drug from September through December out of her savings. In October, we used her annual election period to join a Part D drug plan that started on January 1st. Part D has a catastrophic coverage limit that functions to protect Medicare beneficiaries from massive drug spending in any given calendar year. A one month supply of her medication in January immediately put her into that catastrophic coverage level, and thereafter she has only had to spend 5% of the cost of the drug to continue her treatment into 2012.
Imagine if she had been diagnosed in February instead of September and would have had to fund the medication for 11 months. Not everyone has the savings to do that. For this reason, our agency recommends that Medicare beneficiaries protect themselves from scenarios like this where they may have to pay a fortune for a critical medication. If you don’t take many prescription medications, ask your insurance agent to help you enroll in one of the least expensive Part D drug plans available in your state. That way you aren’t spending too much, but you have the coverage for a rainy day.
