Michael J. Burgess, Director of the New York State Office for the Aging is reaching out to Medicare beneficiaries across the state to make sure they make informed decisions as they review their selections for Medicare Prescription Drug Plans for 2009. Failure to carefully select the proper plan can lead to very costly prescription drug costs during the year that could be avoided if another plan is selected.
A new and unexpected payment structure for at least some of the plans offered to New York residents will cost enrollees more money for some drugs with cheaper alternatives. This pricing scheme requires the Medicare beneficiary to pay the cost sharing amount plus an additional amount that supplements the cost-sharing for prescriptions in certain categories. The additional amount, often called the "product selection penalty" is really the difference between the full price of the brand name drug and the full price of the generic equivalent.
While noting that the plans are technically correct in how they are presenting drug costs to beneficiaries, Director Burgess indicated that he plans to contact the federal Centers for Medicare and Medicaid Services, who administers the Medicare program, to ask them to change their regulations so that this information is presented in a way that is clearer and easier for people to see the true costs of these drugs under each of the plans available to them.
This new pricing structure could add significantly more costs to some prescription drugs and because these costs are hidden during the selection process, beneficiaries may not be aware of these charges until they actually receive their prescription at the pharmacy. Some drugs would cost the beneficiary more than 150% more out of pocket.
Director Burgess said, "The only indication that a given plan will be charging this additional amount for a prescription appears as footnote in the information provided to beneficiaries. He cautioned those looking to select a plan or changing plans to look for footnote No.8 which states: "this drug may be subject to supplemental cost-sharing in addition to the price displayed. Please contact the plan for details".
Currently, the most accurate way for Medicare Beneficiaries to compare Part D prescription plans is to use the on-line tool called the Plan-finder
at http://www.medicare.gov
By entering their prescription usage, a beneficiary can obtain the annual cost estimates for the top-three plans selected specifically for them. This penalty pricing structure limits the accuracy of these pricing estimates, making it very difficult to choose a plan appropriately.
Director Burgess noted that "The New York State Office for Aging would like all beneficiaries reviewing their plan selection during this time to be aware of this issue and to take the time to review all plan pricing options carefully before selecting a Part D Plan for 2009."
The New York State Office for Aging has trained counselors available throughout the state to assist Medicare Beneficiaries with their health insurance questions. The Health Insurance Information Counseling and Assistance Program (HIICAP,) is available in 58 counties and can be reached by calling 1-800-701-0501 toll-free.
