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Thinking About Health
Beware the sales pitches during Medicare’s annual open enrollment PDF Print E-mail
Written by Wauneta Breeze   
Thursday, 23 October 2014 15:48

Editor’s Note: The Rural Health News Service is funded by a grant from The Commonwealth Fund and distributed through the Nebraska Press Association Foundation, the Colorado Press Association, the South Dakota Newspaper Association and the Hoosier (IN) State Press Association.


By Trudy Lieberman

Once again it’s Medicare open enrollment season, the time for those on Medicare to choose how to cover the gaps in the government health program for seniors and people with disabilities. Once again beneficiaries in many parts of the country face a bewildering number of choices---far more than most of them can reasonably evaluate. It’s no wonder studies show that beneficiaries stick with the same plan year after year even though they may be able to get something cheaper.

In New York City I have nearly 100 choices considering both Medicare Advantage plans and traditional Medigap policies, but I’m not about to switch. This year, though, I did a little “shopping” to help readers understand what they might confront should they wade into the thicket of options. They are especially plentiful for Medicare Advantage plans, a private managed-care arrangement that restricts the doctors and hospitals a person can use.

The usual flyers and brochures from sellers of Medicare Advantage plans began to arrive in the mail a few weeks ago. One nearly fooled me. It read, “Medicare Health Plan Information, Important Information Regarding 2015 Changes Enclosed.” For a minute I thought it was Medicare contacting me to tell me I had to pay a higher monthly premium.

But it was only a “lead card” used by insurance agents and brokers to gather names of sales prospects. The card instructs recipients to send their names and phone numbers to the National Reply Center in Indianapolis. I’ve seen similar pitches from the National Reply Center for years. Presumably they’ve sent the names on to insurance sales agents.

Tip Number One: Don’t respond to vague solicitations like this or to solicitations directly from insurance companies for that matter unless you absolutely want an agent to come to your home and give you a pitch.

The brochure from Empire Blue Cross offered $23 premiums for its Medicare Advantage plan and said to ask for details. I did and got none. The phone intake worker said I had to give some personal data to get specific information from an agent on the phone. Or, she said, I could attend a seminar, one of those coffee klatches insurers have where they talk copays and deductibles over donuts and coffee and get people to sign up.

UnitedHealthcare sent a classier brochure, an “invitation” to save the date for one of those coffee klatches. It was pushing its zero-premium plans but did advise “limitations, copayments and restrictions may apply.” I know the real money action is not in a copayment, which is small fixed amount beneficiaries have to pay for services that require copays. But the big cost burden comes from coinsurance, the percentage of the bill the beneficiary has to pick up. The brochure said nothing about that.

The Medicare Handbook noted that United’s zero premium plan comes with a 20 percent coinsurance obligation for chemo drugs, Part B drugs, which include those received for hospital outpatient care, and durable medical equipment like hospital beds. These are high-ticket items, and insurers are eager to transfer some of the cost to beneficiaries.

Tip Number Two: Be sure you know how much your coinsurance will be and what services it applies to. Company sales agents usually don’t talk much about these at the coffee klatches. The other day I wandered into a sales presentation a representative of WellCare was giving to a group of seniors at a New York City food court. I asked the sales agent if he was going to talk about coinsurance. No, he replied. “We are only giving a summary of benefits here.” If prospective buyers knew what they might have to pay for some of those benefits, maybe they wouldn’t sign up.

I did get a United representative on the phone. He didn’t seem to know a lot about the policies his company offered. I kept asking questions. Finally, he said drug expenses don’t count toward the out-of-pocket maximum you have to pay. In other words, only medical expenses, not those for prescription drugs, count toward satisfying the maximum amount you have to pay out of pocket.

Tip Number Three: Understand what expenses do and don’t count toward the maximum.

Tip Number Four: Don’t fall for a plan just because it has a low or no monthly premium. You won’t find out which plan is really cheaper until you use it and learn how it works when you get a chronic disease or a life-threatening illness. A low-premium plan may become very expensive if you need high-priced cancer drugs and have to pay 20 percent of the cost.

Once again my advice is buyer beware-and consider the old-fashioned Medigap policies especially Plans F and C. They give you the most coverage and the most protection from unexpected or catastrophic expenses even if your monthly outlay is larger.


TRUDY LIEBERMAN is a contributing editor to the Columbia Journalism Review where she blogs about health care and retirement. She is also a fellow at the Center for Advancing Health where she blogs about health.

 

 
Generic drug field is full of pricing traps PDF Print E-mail
Written by Wauneta Breeze   
Thursday, 16 October 2014 00:00

Editor’s Note: The Rural Health News Service is funded by a grant from The Commonwealth Fund and distributed through the Nebraska Press Association Foundation, the Colorado Press Association, the South Dakota Newspaper Association and the Hoosier (IN) State Press Association.


A friend of mine, a diabetic, stumbled on to another booby trap in the pricing of generic drugs. In my last column I described the new two-tiered arrangements insurers are pushing on patients. You can choose a non-preferred generic and pay more, maybe a lot more, or a preferred generic and get a price break. That’s the same pricing scheme insurers use for the expensive brand-name drugs.

Consumer groups, doctors, and insurance carriers have encouraged patients to choose generics over the name brands as a way to help lower the nation’s healthcare tab. So for many years my friend has been using a generic drug called gemfibrozil that diabetics often take to lower triglycerides and cholesterol.

It has worked for him. No nasty drug interactions. No nasty side effects. And the price has been low–$2.71 for 60 pills. In August the price more than doubled to $6.14. He was still OK with that.

He was not OK when he got a bill in September from Express Scripts, the pharmacy benefit manager for his Medigap carrier whose plan is offered by his former employer, the City of New York. (PBMs, as they’re called, manage the drug benefits for employers and insurers and supposedly help hold the line on prices.)

Express Scripts wrote his doctor without consulting my friend, the patient, suggesting that for reasons of “safety and efficacy,” he should switch his patient to a different drug, a generic called fenofibric acid. His share of the cost would now be  $156.70 for 90 pills. Fenofibric acid costs $1.74 per pill compared to gemfibrozil’s 10 cents a pill resulting in an out-of-pocket cost increase of 1,640 percent.

Why the switch, my friend asked his doctor. The doctor pointed to the reasons given in the letter about an increased risk of skeletal muscle effects and said maybe it was advisable to try the new drug. He was, however, astounded by the price, but my friend said it was clear the doctor wasn’t going to fight the PBM.

My friend spoke to an official at New York City’s employee benefits office who said her office has never heard of a PBM recommending that a more expensive generic drug replace a cheaper one.

I rang up John Rother, former chief lobbyist for AARP and now head of a group called the National Coalition on Health Care. The Coalition is waging a campaign to educate the public about the exorbitant prices of drugs, particularly the Hepatitis C drug Sovaldi and other specialty drugs in the pipeline that will carry super high price tags.

“Generic drug prices have been rising steeply, and there doesn’t seem to be an explanation for it,” Rother told me. He said he could only guess that some generic drug makers are leaving the market and the ones remaining will have less competition and the power to increase market share and raise prices.

Maybe there are medical reasons my friend should make the switch, but so far his doctor hasn’t been persuasive. Has the PBM discovered new side effects for the drug he’s been taking? Who’s treating the patient–the doctor or the PBM? And how does this big price jump fit in with the PBM’s purported mission: to save money for insurers and employers? Was my friend caught in a tussle between the clinician and the bean counters? How does he know who’s right without doing extensive research himself?

Since individuals can’t negotiate prices with drug companies, and Congress has prohibited Medicare from negotiating prices when it passed the prescription drug benefit law in 2003, my friend says, “companies have carte blanche to rip people off. In situations like this no one ever talks straight, but someone is making a lot more money.” He’s trying to get back on gemfibrozil or a similar generic that’s cheaper than the one the PBM suggested.

Rother looks at the big picture now coming into focus from the sharply rising prices of generics. “Four years after we passed what we thought was universal health coverage, you can’t get the medicines you need because of the prices. It’s tragic,” he says.

We want to hear your questions and comments about your healthcare experiences. Tell us about your experiences with generic drugs. Write to Trudy at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .


TRUDY LIEBERMAN is a contributing editor to the Columbia Journalism Review where she blogs about health care and retirement. She is also a fellow at the Center for Advancing Health where she blogs about health.