newjerseynewsroom.com

BY IRENE C. CARD AND BETSY CHANDLER

NEWJERSEYNEWSROOM.COM

YOUR HEALTH INSURANCE

Open enrollment for making changes to your Medicare Prescription Drug Plan known as Part D is right around the corner. This year, we will have more time to review and make changes to be effective January 1, 2012. Open enrollment begins on October 15th and ends on December 7th. In the past it was November 15th through December 31st.

It is important to understand that open enrollment does not apply to your Medicare Supplement Plan also known as Medigap. There is no open enrollment for your Medigap policy; you can change at any time, depending on your health but most people stay put with their plan for their entire lives. If it isn’t broken, don’t fix it.

The same rule applies to Part D. If you like what you have, if it covers most or all of your drugs and you can afford the premium, then there is no need to change plans during open enrollment. Keep in mind that if you make a change during 2011 open enrollment, the change only becomes effective on January 1, 2012.

Toward the end of September, you should be getting an “open enrollment package” in the mail from your Part D insurance plan. Open it and read it; do not be overwhelmed by it. Look for the new premium and the copayments that you will have to make and if they are within reason, then stay put. No action is required on your part if you do not make any changes. It is anticipated that premiums will stay about the same as they are in 2011 or even come down a few dollars because the government has negotiated with the pharmaceutical industry to provide the drugs at slightly lower costs than in 2011.

Each year the government makes some changes that all the insurance carriers must abide by. If you choose a plan with a deductible it will be $320, the same as in 2011. Depending on the plan that you purchase, you will either pay 25 percent after the deductible or have a copayment during the initial coverage period. When the actual cost of the drugs (that is what you pay plus what the Plan pays the pharmacy) reaches $2930, you go into the coverage gap also known as the donut hole. In 2011 that number was $2840.

In 2012 instead of the coverage gap being $4,550 it will be $4,700. Once you are in the coverage gap, you will pay half of the cost for brand name and non-preferred brand name drugs and you will pay 86 percent of the cost of a generic drug. For example, if the generic drug is $10 for a 30 day supply, you will pay $8.60. There are some plans that you can purchase that will cover certain drugs in the coverage gap (donut hole). When your “true out-of-pocket costs” reaches $4700 you reach the catastrophic level and your cost is dramatically reduced. The true out-of-pocket cost is known as TROOP and it includes the deductible and any co-payments that you pay plus the 50 percent that you pay when you are in the coverage gap. The government tells us that less than 10 percent of Americans reach the coverage gap. I find that hard to believe. If you get out of the coverage gap before December 31st, (you spent $4700), the catastrophic benefit will make it much easier for you to pay for your drugs. You will pay $2.60 for generic drugs and $6.50 for most brand name drugs. On January 1st of each year, you start all over again.

Co-payments will vary from plan to plan as will the premium. There are approximately 75 plans from which to choose in New Jersey alone which makes it most confusing for someone to try and figure out their best options. If I haven’t confused you yet, I will add that the government allows some plans to change some of the numbers! I have no idea why.