With three weeks left for seniors to change their Medicare prescription plan for 2012, a new study brings distressing news: Copays for brand-name drugs are going up _ sharply in some cases.
Copays for preferred brand-name drugs will increase by 40 percent on average next year, and non-preferred brands will average nearly 30 percent more, according to the study by Avalere Health. Copays are the portion of the cost of each prescription that the customer pays the pharmacy.
Avalere, a data analysis firm that serves industry and government, says its findings show that Medicare prescription plans are steadily shifting costs to chronically ill patients who need more expensive kinds of medications. At the same time, the plans are trying to keep costs in check for the majority whose conditions can be managed with less-expensive generics.
The changing scene underscores how important it is for seniors to check their prescription coverage before open enrollment ends Dec. 7.
Medicare announced this summer that premiums for prescription plans would remain unchanged next year, an average of about $30 a month. But the government's numbers didn't delve into detail on copays. The Avalere study shows that the plan with the lowest monthly premium may not always be the best deal.
"Seniors need to look beyond the premium to understand their drug benefit," said Avalere CEO Dan Mendelson. "The more the cost burden gets shifted onto the patient who needs the medication, the more important it is for seniors to understand that next level."
Medicare officials took issue with the study, saying broad averages of prices charged by drug plans don't determine what an individual beneficiary will end up paying.
"Everyone's drug needs are going to be individual," said Medicare deputy administrator Jon Blum. "You can't make a general conclusion until you look at the particular plan they are in and the particular drugs they are taking."
Blum pointed out that President Barack Obama's health care overhaul law is saving money for beneficiaries with high drug costs, providing a 50 percent discount on brand-name drugs for those who fall into Medicare's "doughnut hole" coverage gap.
The administration is highly sensitive to criticism of its stewardship of Medicare. After Obama's health care law cut the program to finance coverage for the uninsured, many seniors responded by voting for Republicans in the 2010 congressional elections.
Medicare covers about 47 million seniors and disabled people, and about 9 in 10 beneficiaries have some kind of prescription drug plan. Most rely on the prescription program, also known as Part D, which is delivered through private insurance plans.
The Avalere study found that copays for preferred brand-name drugs will increase to an average of $40.60 next year, up from $29.01 currently. Preferred brands are usually drugs for which the prescription drug plan has negotiated a discount with the manufacturer.
Copays for non-preferred brand drugs will rise to $91.67 on average, from $71.52 this year.
Beneficiaries will also pay a bigger share of the cost of specialty drugs, which can exceed $1,000 or more per prescription. The share for 2012 averages about 32 percent, up from 27 percent this year. Specialty drugs include many of the newer treatments for chronic diseases such as rheumatoid arthritis and multiple sclerosis, as well as next generation anti-cancer drugs that come as pills.
By contrast, copays for preferred generics will remain stable, averaging $3.79. And copays for non-preferred generics will drop to $9.90, a 43 percent reduction from the current $17.29.
Medicare prescription plans usually have several levels of coverage _ each with a different level of cost-sharing for the patient. The most common kind of plan has five levels: preferred generics, non-preferred generics, preferred brands, non-preferred brands and specialty drugs.
Since the Avalere figures are averages for the entire program, actual costs could vary markedly by medication, plan and region of the country.
The study also found big differences in the total number of drugs covered by the top 10 plans. Topping the list is the Humana Enhanced plan, which will cover nearly 80 percent of the more than 2,300 Medicare drugs. By comparison, the WellCare Classic plan will cover just under half.