Medicare Drug Coverage Confusing, Expensive, Changes Annually

It pays – really pays – for seniors to review their Medicare drug coverage.

By Rose Hoban

The Thanksgiving holiday has a number of traditions: turkey, pies, football and, for the past decade, helping elderly parents or grandparents with their Medicare Part D drug plans. The holiday comes at the end of the annual sign-up period, when seniors take the time to review their plans for the coming year and save hundreds by making adjustments. Or not.

Senior PharmAssist Director Gina Upchurch explains a point during a recent class. Photo: Rose Hoban — Senior PharmAssist director Gina Upchurch explains a point during a recent class. Photo credit: Rose Hoban

“Medicare beneficiaries should really review their coverage every year,” said Gina Upchurch, head of Senior PharmaAssist, an organization dedicated to helping Durham County seniors understand and get access to the appropriate drugs. In 2012, Upchurch did some research: She and her co-authors found that about two-thirds of seniors could save more than $530 annually by checking their Medicare drug plans during the open enrollment period each fall. She said that this past year they surveyed 683 beneficiaries who came in for help choosing their Medicaid drug plans. Two-thirds needed to switch. “Every year, it’s two-thirds!” Upchurch said. “Two-thirds need to switch plans for a mean annual savings of $983.” [pullquote_left]There are counselors who work with the Senior Health Insurance Information Program in each county. Find one here. Or call 855-408-1212[/pullquote_left]But the research shows fewer than 15 percent actually make the switch, she said. That frustrates Upchurch, who has spent the last decade getting to know the Medicare drug benefit, which rolled out in 2006 “Overall, 75 percent of seniors are not in their lowest-cost plan,” she said. “On average, beneficiaries are spending 30 percent more than they have to on their medicines.”

Moving parts

When Congress created the Medicare Part D in 2003, elected officials said they wanted to give seniors more choice over their plans. But for years, Upchurch has said she believes the program has “too much choice.”

Maribeth Hersey said she spent hours trying to figure out the best Medicare Part D plan for her husband. She finally resorted to printing out all the details of the final four plans so she could compare. — Maribeth Hersey said she spent hours trying to figure out the best Medicare Part D plan for her husband. She finally resorted to printing out all the details of the final four plans and hanging them up in her kitchen so she could compare. Photo courtesy Maribeth Hersey

“They need to remove some of the moving parts to Medicare Part D to standardize it,” she told a roomful of pharmacists during a training in October. “It’s way too overwhelming and you get what’s called decision-making paralysis.” Many seniors have one or a handful of really expensive drugs, and the trick is to find the pharmacies selling those medications at the cheapest price. Upchurch said that can be harder than you think. “One drug might be cheaper at one pharmacy and one might be cheaper at another pharmacy,” said Durham resident Maribeth Hersey, whose husband had several expensive drugs. “I don’t understand it.” Hersey told of going to pick up a blood-thinning medication for her husband. “When it was advertised, the wrong price was in the system, or the price changed, I don’t know,” she said. “Because the computer said $45 a month [and] when I went to pick it up it was $720. So I went across the street to Walmart, where it was $396 a month.” It subsequently went up to $1,200 a month. “I don’t think it needs to be this hard,” Hersey said. This year, she spent days on the computer comparing drug plans, printing them out and hanging them up in the kitchen, combing through each option. “I’m not working, so it’s my full-time job, and it’s not so bad right now, because I have the time to do all the research,” Hersey said. “But for people who have a low reading level or they’re seniors … things are more intimidating. I don’t know how they do it.”

Just expensive

Sometimes there’s no way around the prices seniors pay for medications; they’re just expensive. That’s what Raleigh resident Pat Stumpf found when she went shopping for her husband’s Namenda. The drug, which is used to relieve some of the symptoms of Alzheimer’s, was a blockbuster for the manufacturer Activis, netting the company $1.5 billion in sales in 2013-14. It cost Stumpf and her husband a pretty penny. “Insurance companies put it at top-tier level,” she said. “I had to start paying a $120 copay every month.” Because her husband did better on the name brand than the generic form of Namenda, they had to continue paying more. “It kept changing – went anywhere from $120 to $133 then to $153, and the last time I went it was $178,” she said. Last year, Activis was about to lose its patent to be the exclusive seller of Namenda, so the company reformulated it into a long-lasting version, Namenda XR, which extended the patent 10 years. Then Activis stopped manufacturing the original Namenda, so as to force patients into the newer, still-expensive form. This enrages Stumpf. “People are being taken advantage of,” she said. “Why is it happening? Why are congressmen and senators powerless to do anything about it? Or maybe they choose not to do anything about this?” Luckily for Stumpf, New York Attorney General Eric Schneiderman agreed with her. In 2014, Schneiderman sued Activis, stating in a press release: “A drug company manipulating vulnerable patients and forcing physicians to alter treatment plans unnecessarily, simply to protect corporate profits, is unethical and illegal.” A federal district court agreed with Schneiderman, forcing Activis to continue making the original Namenda, alongside the long-acting form. Stumpf said that under the plan she’s chosen for this year, she’ll pay $47 per month for the Namenda.

The free market takes, and it gives

Upchurch explained that the Centers for Medicare and Medicaid Services instructs insurance companies to cover drugs for all kinds of conditions and to have at least one or two of every type of drug in their drug lists, called formularies. Meanwhile, these kinds of price manipulations plague seniors who are dependent on their medication. She said that, for example, the price of some long-acting types of insulin have skyrocketed, forcing patients to pay more out of pocket. “They didn’t say they have to be cheap, they just said they have to cover them,” Upchurch said. She said there’s another side to the price equation. “I love talking to senior groups, because I ask them who thinks medicines are too expensive? And they all stand up or raise their hand,” Upchurch said. “Then I say, ‘OK, if you have a retirement portfolio that you are benefiting from that’s got pharmaceutical companies in it, then you need to sit down or lower your hand.’ “Because we cannot have it both ways.” Upchurch believes that many seniors end up taking too many drugs. She works to educate patients about things they can do to wean themselves off of medications, like losing weight. “Sometimes the best medicine for certain things is no medicine at all, or there are other preventative things that we can do,” she said. “But we have been driven to create the silver bullet to fix things.”