Using manufacturers’ coupons and Medicare together, to pay for medications is illegal. Individuals with Medicare coverage often have a large out-of-pocket cost for their medications. It’s easy to understand why many are looking for a way to lessen that expense.
In 2017, Medicare spent $100 billion on medications. This accounts for about 14% of Medicare’s entire spending for the year. Whereas in 2007, Medicare only spent $49 billion on medications.
Many seniors have a set monthly income, so looking for ways to save money is common. Likewise, beneficiaries make up a large population of seniors.
Unfortunately, the government doesn’t allow beneficiaries to use drug coupons or discount with Medicare Part D. Using manufacturers’ coupons and Medicare together may not be an option, however, seniors may have other options to save.
Manufacturers’ Coupons and Medicare Part D
Using drug coupons for medications is perfectly legal. However, combining them with Part D coverage isn’t.
When using drug coupons, you must pay out of pocket and cannot use your Part D plan for that prescription.
Determining when you’ll save more money is the tricky part. Pharmacies can leave your options unclear, making it hard to decide which option is more cost friendly.
Partially due to the contracts that pharmacies and pharmaceutical companies have between each other.
Pharmacy benefit managers (PBMs) act as “middle-men” negotiating contracts between the two parties. PBMs establish drug formularies, set up discounts and rebates for manufacturers, and process the pharmacy’s claims for prescription medications.
Pharmacy Gag Rule
For many states, a portion of the contract negotiation includes a ‘pharmacy gag rule’. This rule states that the pharmacist isn’t allowed to tell customers if there’s a less expensive medication option.
PBMs want customers to use drugs on their formularies because those drugs make them the most money. The problem is, you, as a consumer, end up paying more than you should for your prescriptions.
In 2017 some states put a ban on the pharmacy gag rule. States including Connecticut, Georgia, Main, and North Carolina. Soon following, in 2018, ten more states fought against this rule.
Arizona, Florida, Missouri, Mississippi, New Hampshire, New York, Pennsylvania, South Carolina, Virginia, and Washington took steps to put an end to pharmacy gag rules. In fact, so many were against the ‘pharmacy gag rules’ that the federal government had some involvement in September of 2018; it was a success.
Following was the unanimous passing of The Know the Lowest Price Act of 2018. This act now prevents PBMs from creating gag clauses that affect beneficiaries with Medicare.
Similarly, The Patient Right to Know Drug Prices Act is another bill providing protection for individuals with private insurance coverage.
The Anti-Kickback Statute
Social Security Amendments of 1972 made it illegal for pharmaceutical companies to give discounts for any medications bought through Medicare.
The 1972 Amendments also include the Anti-Kickback Statute (AKS). Making it illegal for anyone, to offer drug coupons and rebates to customers for items or services that a federal healthcare program pays.
When a pharmaceutical company suggests you choose a more expensive drug option, Medicare spends more money than if you chose the lower-cost generic medication. Although the manufacturer offers a discount, coupons are generally for their newest and more expensive medicines.
Moreover, these drug coupons usually have a small lifespan plus an annual maximum cost. This means you and Medicare would be responsible to pay the remaining amount for the rest of the year.
The AKS prevents individuals from abusing the system. In turn, Medicare reduces cost spending.
Manufacturers’ Coupons and Medicare Part D
The Centers for Medicare & Medicaid Services requires pharmacists to always use Part D plans for payment unless a patient specifically asks them. Speak with a pharmacist about payment options about certain medications.
They can help determine whether a drug coupon or your insurance copay is the better deal. Base your decisions on your personal situation.
Some medications may be cheaper with your insurance. Meanwhile, others are less expensive when paying with a prescription discount.
Medication not on Drug Formulary
On the other hand, Part D plans don’t always provide coverage for your medication. Some of your prescriptions may not be on your plan’s formulary.
In which case, you may try a different and more cost-effective medication for your health condition.
Unfortunately, alternative medications often fall short and you may consider a drug that your Part D plan doesn’t cover.
Although you may use drug coupons for some time to cover the costs, eventually they’ll run out. Resulting in an increase of out-of-pocket expenses for your medication.
Reaching Your Deductible is Unlikely
The amount you must spend each year before the insurance begins is known as your deductible. The amounts vary among plans, some higher or lower than others.
For instance, the maximum deductible for Part D costs $415. If you’re unlikely to meet your deductible amount within the year, consider using drug coupons instead of your insurance plan.
Reaching the Donut Hole Phase
Part D prescription drug plans come with an unfortunate coverage gap. This gap is better known as the donut hole phase.
If beneficiaries spend over a certain amount each year, their Part D plan decreases coverage. In 2019, this amount is $3,820. During this time, beneficiaries must pay 30% for brand-name drugs and 37% for generic drugs.
It may be reasonable to use drug coupons during this time to keep out-of-pocket expenses down.
Part D Plan Coverage Changes
Things involving Medicare are always changing, this includes plans and their coverage options. Part D plans make changes to their drug formularies.
Maybe your plan gave coverage for your medication but since enrolling your medication is no longer on your plan’s formulary.
It’s also possible that the amount of coverage is less than it was before. For example, your plan may now only cover a fraction of the cost of your prescriptions. Another example is if your plan stops covering the costs of your medications.
For these situations, using a drug coupon may be an option to consider. However, your best option would be to enroll in a different Part D plan that provides the coverage you need.
However, you must wait to change plans until the Annual Enrollment period. In the meantime, drug coupons may benefit you.
Let Us Help You!
Just because you can’t combine Manufacturers’ Coupons with Medicare Part D, doesn’t mean you can’t use them at all. You just need to make a choice.
Determining which option saves the most money is the only tricky part. However, it doesn’t have to be!
We can help compare rates for you. Pharmacy gag rules are dissipating, giving you more rights for finding the best prices for your prescriptions. Give us a call today at the number listed above. If you don’t have time, fill out an online rate comparison form.
Our team of professionals is happy to help answer any questions about coverage.