ALTHOUGH AS MANY as 48% of seniors were subject to some type of drug-coverage deficiency in 2006, only an estimated 4 million
of the 22.5 million enrolled in Medicare drug plans were actually expected to hit the infamous donut hole. There could still
be financial woes, however, for the 10.8 million Medicare beneficiaries who at least have the potential for out-of-pocket
costs in the donut hole gap because they do not qualify for a subsidy, are not covered outside Part D, or did not pay for
enhanced gap coverage.
A PricewaterhouseCoopers study estimates that 38% of seniors have coverage outside of Part D; 23% are under low income subsidy,
and therefore the gap is covered; 6% have enhanced plans with some gap coverage; and 16% do not spend enough to reach the
donut hole.
Under the 2006 plan design, after beneficiaries reached the $2,250 coverage limit, they entered the gap. Once in the gap,
they paid out of pocket to reach the $5,100 limit, for a total gap of $2,850. This year, the total gap increased to $3,051
and is projected to grow to $5,066 by 2013. The coverage gap, deductibles and out-of-pocket thresholds are all subject to
increases each year based on increased expenditures for Part D drugs. A survey by Market Strategies asked Part D beneficiaries how they paid for drugs in the gap: 72% of respondents say they pay
for their drugs out of pocket, 11% request samples, 9% order them from another country, 7% pick the drugs that are most necessary,
and 4% take their drugs less frequently. "Beneficiaries have to make decisions about which drugs to take, or cut back on doses, which can present a higher risk of
morbidity and mortality," says Babette Edgar, senior vice president, strategic business solutions for Gorman Health Group
in Washington, D.C., which provides counsel and services to Medicare and Medicaid private sector partners. Besides less-expensive
therapeutic alternatives, she recommends pill splitting when appropriate.
According to an estimate made in September by America's Health Insurance Plans (AHIP) member organizations, 3 million beneficiaries
were predicted to reach the gap in 2006 with about 10% of Medicare beneficiaries having already hit the gap as of last September.
AHIP recommends cost-cutting strategies to help beneficiaries lower their out-of-pocket costs:
- Reaching out directly to beneficiaries who are about to enter the gap via phone calls and letters to make them aware of available
tools and techniques to assist them through the gap;
- Encouraging beneficiaries to use their drug plan cards when they go to a pharmacy while in the gap because recent data have
shown that they may accrue up to 35% off retail prices;
- Ensuring that low-income beneficiaries who qualify for state patient assistance programs (PAPs) are taking advantage of them;
- Providing information about other sources of assistance, including pharmaceutical manufacturers' PAPs;
- Providing special training for customer service representatives; and
- Offering information via newsletters and plan Web sites.
AHIP also promotes the use of generic substitution when appropriate, which could save beneficiaries between $350 and $800
per drug per year and prevent or delay them from falling into the coverage gap, according to a Consumers Union survey. The
use of formulary management techniques could potentially save individuals 20% to 25% off retail prices for prescription drugs,
according to the Congressional Budget Office.
SETTING THE PACE
Not surprisingly, the Pharmaceutical Care Management Assn. (PCMA), a national association representing pharmacy benefit managers
(PBMs), touts the use of mail service and generics to help beneficiaries avoid or delay entry into the donut hole; however,
PCMA President Mark Merritt says that many beneficiaries are not taking advantage of those tools because they are not aware
of them.
