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Top Medicare Part D Plan Costs Spike in 2013

By Lisa Zamosky

Medicare Card

Just in advance of Medicare’s Annual Enrollment Period (AEP), the research and advisory services firm, Avalere Health, released an analysis of Medicare Part D drug plan costs.

Average premiums are expected to rise by 6% next year. But that overall number only tells part of the story. Avalere took a deeper look at the market to uncover some steep increases in a number of the most popular plans around the country. Some of the top plans, in fact, are gearing up for double-digit cost increases.

Higher Drug Coverage Premiums Next Year

The biggest spike will come from Humana Walmart’s Preferred RX Plan, which for 2013 will see premiums rise by 23%.

Both the Cigna Medicare RX Plan and First Health Part D Value Plus will increase the cost of their prescription drug plans by more than 15% in 2013. Overall, the report says, “seven of the current top 10 prescription drug plans have double digit increases in premiums.”

As a result of the increases, half of the top 10 plans will no longer qualify to receive low-income subsidy beneficiaries. That means that if you get help from the government to pay for your prescription drug plan (the program is called “Extra Help”), this is something you need to be aware of when shopping for prescription drug coverage this fall.

The top ten plans are listed in the chart below along with changes in premiums between this year and next.

2013 PDP Offering 2012 Average Premium1 2013 Average Premium2 %

Change

 

(2012-
2013)

AARP MedicareRx Preferred (PDP) .85 .42 1%
SilverScript Basic (PDP) .27* .74 8%
Humana Walmart-Preferred Rx Plan (PDP) .10 .50 23%
Humana Enhanced (PDP) .58 .77 11%
First Health Part D Premier (PDP) .59 .54 18%
WellCare Classic (PDP) .86 .76 3%
HealthSpring Prescription Drug Plan (PDP) .72 .71 12%
Cigna Medicare Rx Plan One (PDP) .09 .78 15%
First Health Part D Value Plus (PDP) .43 .75 17%
Express Scripts Medicare – Value (PDP) .88** .42 13%
Top 3 Plans .85 .78 3%
Top 10 Plans .43 .38 6%
All PDPs .89 .27 6%

Source: Avalere Health analysis using DataFrame®, a proprietary database of Medicare Part D plan features and 2013 PDP data released by CMS on September 19, 2012.

Note: Includes national PDPs or close to being national PDPs. The analysis does not include plans operating in one region.

*PDPs with premiums under per month.

**Enrollment-weighted average premium, except for SilverScript Choice. The Choice plan is new for 2013; therefore, Avalere applied a simple average.

Low-Cost Options

On the bright side, Avalere found a number of plans offering low-cost options for Medicare beneficiaries in 2013:

2013 PDP Offering Parent Organization # of Regions 2013 Average Premium**
AARP MedicareRx Saver Plus UnitedHealth Group, Inc. 30 .00
Humana Walmart-Preferred Rx Plan Humana Inc. 34 .50
SilverScript Choice CVS Caremark Corporation 33 .13
First Health Part D Value Plus Coventry Health Care Inc. 32 .75

Source: Avalere Health analysis using DataFrame®, a proprietary database of Medicare Part D plan features and 2013 PDP data released by CMS on September 19, 2012.

Note: Includes national PDPs or close to being national PDPs. The analysis does not include plans operating in one region.

*PDPs with premiums under per month.

**Enrollment-weighted average premium, except for SilverScript Choice. The Choice plan is new for 2013; therefore, Avalere applied a simple average.

UnitedHealth Group’s AARP MedicareRX Saver Plus, the report highlights, is among the lowest you’ll find in many markets throughout the country. And the CVS Caremark and Coventry plans offer a low premium for more comprehensive coverage.  They keep costs down by limiting the pharmacies they include in their network, Avalere says.

Do Your Homework

As with any health plan you purchase, you need to look beyond its monthly premium.

Are the medications you take covered by the plan (check the formulary)? Are participating pharmacies nearby your home?

Pay close attention to any restrictions associated with a plan. Will you need prior authorization from in order for your medication to be covered? Are there quantity limits in effect?

All of these factors can have a huge impact on your total out-of-pocket costs.

Use Decision-Making Tools

You can compare Medicare prescription drug plans by inputting your zip code on the Plan Finder tool at www.Medicare.gov . You can also compare and purchase plans at PlanPrescriber.com.

If you’d rather talk with someone who can offer you personalized help in deciding what coverage you need, there are counselors available through your State Health Insurance Counseling and Assistance Program (SHIP), free of charge, to assist you with your selection process.

Find your local program by visiting the Medicare.gov Medicare Helpful Contacts page or by calling 1-800-MEDICARE.

Have your prescription drug program costs gone up? Share your comments/concerns in the section below.

Photo: Ingram Publishing
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