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Sleep News Blog

Prescription Sleep Medicine

Prescription Medications - How to Deal With the Escalating Cost

Posted by sleepyguy in Prescription Sleep Medicine, Sleep Disorder on April 30th, 2009

The Escalating Cost of Prescription Medications

The cost of medications is an increasing concern to many American families. As a nation we spent over $200 billion on prescriptions 2006. The cost of medications has increased faster than the cost of hospitals or physician care. Medicare implemented its Part D prescription drug benefit in 2006. The nasty surprise of Part D is the coverage gap, also called the doughnut hole. This is the portion where you pay 100% of your costs for medications.

In a nutshell here’s how Part D works…including the doughnut hole…for 2009:

* If you join a Medicare prescription drug plan (Part D), you pay the first $295 of your drug costs. This is known as the deductible.

* During the initial coverage phase, your drug plan pays 75% of the covered prescription drug costs after your deductible is met, and you pay 25% until the total drug costs (including your deductible) reach $2,700.

* Once you reach $2,700 in total drug costs, you will be in the donut hole and you must pay the full cost of prescription drugs until your total out-of-pocket cost reaches $4,350. This annual out-of-pocket spending amount includes your yearly deductible and copay amounts.

* When you spend more than $4,350 out-of-pocket, the coverage gap ends and your drug plan pays most of the costs of your covered drugs for the remainder of the year. You will be responsible for a copay of $2.40 for each generic drug and $6.00 for other drugs. This is known as catastrophic coverage. Remember, to qualify for Medicare you must be either 65 years old or disabled. When you’re on Medicare you pay a monthly fee for Part B, doctors’ services, which is normally deducted from your monthly Social Security payment. For 2009 that fee is $96…and it does increase each year.

Typically Congress votes a raise in Social Security - just enough to cover the Part B increase…plus a few bucks. For those of us not on Medicare we rely mostly on major medical insurance plans offered through our employers. Now that the unemployment rate has exceeded 8% nationally, this has become more of a problem since a good many Americans are losing their health insurance. Yes, coverage can be extended for typically 18 months through COBRA…but this is often prohibitively expensive…since you pay 100% of the cost of the insurance. An increase of 400% or more over what you paid while employed is not uncommon.

Lack of insurance coverage for prescription drugs can have adverse effects. CNN reports that 18% of Americans under 65 are now without health insurance. So what are we to do when prescription costs get out of hand? When they become unmanageable? Discount programs can help save hundreds, even thousands, on medications. There is also a program many Americans use to cap their prescription costs at under $100 a month. There are some income limits on this so it’s not intended for the wealthy.