Part D Catastrophic Coverage with Specialty Drugs

[Trooper]

DW will be starting Medicare in July, and she is currently taking an expensive biologic called Stelara for psoriasis. She has tried many medications and modalities, and Stelara has been the only one thus far that has worked.

It's a Tier 5 specialty drug that prices out at about $16K per shot, and DW needs 4 shots/year. Currently we get the drug through DW's post-retirement private health care plan with CIGNA, under which the drug manufacturer (Janssen) covers most of the cost through an assistance program. That program does not cover patients once on Medicare.

I know that the catastrophic coverage starts at $8,000. Does this mean that $8,000 will be her total drug exposure for the year? Also, in 2025 the donut hole is going away, and catastrophic coverage starts at $2,000. At first we were freaking out about DW's going on Medicare, but potentially it should not be so bad, if I understand how Part D works for expensive drugs.

One thing I don't understand: When I go to Medicare.gov and enter the drug name and dosage, I get a much smaller cost if I choose 1 shot per month, versus her correct dosage of 1 shot every three months. Anyone know why?

 

[MissMolly]

Once you meet the catastrophic limit you have no more out of pocket for covered drugs:

Catastrophic coverage: In all Part D plans, you enter catastrophic coverage after you reach $8,000 in out-of-pocket costs for covered drugs. This amount is made up of what you pay for covered drugs and some costs that others pay. During this period, you owe no cost-sharing for the cost of your covered drugs for the remainder of the year. The out-of-pocket costs that help you reach catastrophic coverage include:

Your deductible
What you paid during the initial coverage period
Almost the full cost of brand-name drugs (including the manufacturer’s discount) purchased during the coverage gap
Amounts paid by others, including family members, most charities, and other persons on your behalf
Amounts paid by State Pharmaceutical Assistance Programs (SPAPs), AIDS Drug Assistance Programs, and the Indian Health Service

https://www.medicareinteractive.org/get-answers/medicare-prescription-drug-coverage-part-d/medicare-part-d-costs/phases-of-part-d-coverage

 

[GrayHare]

Be aware that Part D plans commonly change (reduce) coverage for an expensive drug once enough of their clients reach the catastrophic coverage zone due to that drug. Such changes will be reflected in coverage for the following year. So, you need to plan for higher costs and the game of switching Part D providers each year.

 

[Dash man]

Is this injection done in the doctor’s office or at home by you? If in a doctor’s office it would be under Medicare Part B.

 

[Donno]

I also take a biologic drug and starting this year the co-payment of 5% once reaching the catastrophic stage is eliminated. What this amounts to is essentially a $3300 out of pocket maximum for the entire year. In my case I take an injection once a month and pay this amount for the first two dosages and everything for the rest of the year is at no charge.

Next year, the maximum will be $2000 max out of pocket, but my understanding is that it will be adjusted for inflation each year so who knows how that will work out. My biggest problem so far with going on Medicare was getting the drug approved, even though I had been on it for several years prior.

One thing to look for is an assistance program that most (maybe all) manufacturers have to help seniors with the drug costs. If my income was below $73k, I could actually receive my medicine for free, so definitely look into that.

 

[Trooper]

Is this injection done in the doctor’s office or at home by you? If in a doctor’s office it would be under Medicare Part B.

It's administered at home unfortunately.

 

[Trooper]

I also take a biologic drug and starting this year the co-payment of 5% once reaching the catastrophic stage is eliminated. What this amounts to is essentially a $3300 out of pocket maximum for the entire year.

Interesting - that $3300 amount is the "smaller cost" I mentioned in my original post. Not sure where it comes from.

One thing to look for is an assistance program that most (maybe all) manufacturers have to help seniors with the drug costs. If my income was below $73k, I could actually receive my medicine for free, so definitely look into that.

Thanks; Janssen's assistance program has a much lower income level.

 

[Sunset]

Be aware that Part D plans commonly change (reduce) coverage for an expensive drug once enough of their clients reach the catastrophic coverage zone due to that drug. Such changes will be reflected in coverage for the following year. So, you need to plan for higher costs and the game of switching Part D providers each year.

I check for myself and some other less computer savy older folks about the Part D coverage and cost every year.

This year a couple of us, no medication types are getting covered for $0

 

[target2019]

Check the Medicare site. Pick SilverScripts, Caremark. Just enter that one drug. I am pretty sure that's where you saw the $3300 figure.

This year my cost for erdafitinb dropped to $3300 for first scrip. Next month zero cost.

I have an explanation somewhere. I'll try to find that.

I hope your Tier 5 works same way.

 

[Trooper]

Check the Medicare site. Pick SilverScripts, Caremark. Just enter that one drug. I am pretty sure that's where you saw the $3300 figure.

This year my cost for erdafitinb dropped to $3300 for first scrip. Next month zero cost.

I have an explanation somewhere. I'll try to find that.

I hope your Tier 5 works same way.

Yes that's what I did to see the $3300. Thanks for any explanation you can find.

 

[target2019]

This covers more changes, but scroll down and you'll see the explanation.

https://www.cms.gov/newsroom/press-...tion, as of January,to $3,800 for most people.

This is how I searched Google, if you want to see other refs: $3300 medicare part d

 

[mathjak107]

i am on trulicity which costs 1k a month.

so our part d drug plan has a 50 dollar deductible on this tier drug .

then i pay 11 dollars until i hit the gap at about 5k .

then i go to paying 25% of the drug cost which is 250 dollars .

i never hit the catastrophic level so each year just repeats

 

[MBSC]

Interesting - that $3300 amount is the "smaller cost" I mentioned in my original post. Not sure where it comes from.

$3300 is your portion after mandatory discounts. In 2025, your portion drops to $2000 and you can opt to pay monthly installments under a new "cost share smoothing" payment plan.

In 2024, the catastrophic threshold will be set at $8,000. This amount includes what Part D enrollees spend out of pocket plus the value of the manufacturer price discount on brands in the coverage gap phase. At this amount, Part D enrollees who take only brand-name drugs in 2024 will have spent about $3,300 out of their own pockets and will then face no additional costs for their medications.

Reference: https://www.kff.org/medicare/issue-...reduction-act-and-how-enrollees-will-benefit/

What is the Medicare Prescription Payment Plan?

This program, also known as MPPP or M3P, was introduced under the Inflation Reduction Act and allows beneficiaries to smooth their cost sharing (also known as out-of-pocket costs or OOP) over the course of the year. In the most extreme example, under the M3P, a beneficiary who reaches the $2,000 maximum out-of-pocket (MOOP) in January would pay 12 monthly payments of $166.67 rather than $2,000 in January and $0 the rest of the year. The program is effective January 1, 2025.

The Medicare Prescription Payment Plan is completely voluntary; patients will need to “opt-in” to the program. Participants will not have any monthly bills until they opt into the program AND have out-of-pocket prescription costs.

Consider the following example:

A woman named Ruth is interested in the Medicare Prescription Payment Plan, and she enrolls in January 2025. She has no out-of-pocket costs in January, but she fills her first prescription in February. Her out-of-pocket responsibility is $1,030.37. Ruth filled her prescription in February, so her payments will be divided over 11 months. Her monthly bill will be $93.67.

If Ruth later had additional out-of-pocket prescription costs, her monthly bill would be recalculated. Her annual total will not exceed $2,000, but her monthly payment could change.

 

[sengsational]

I'm expecting that a lot of these Part-D providers will make it difficult for people to get their expensive drugs. Spending all day on hold and getting hung up on...that kind of thing. It seems to be the modus operondi of insurance companies. They shut off all channels to resolve problems except the phone. Then only some fraction of customers have the time and patience to get the insurance company to fulfill their end of the deal. My approach is one call, and if they don't fix it, go to the state insurance commissioner's office. Those folks have contacts and get results, IME.

 

[target2019]

I'm expecting that a lot of these Part-D providers will make it difficult for people to get their expensive drugs. Spending all day on hold and getting hung up on...that kind of thing. It seems to be the modus operondi of insurance companies. They shut off all channels to resolve problems except the phone. Then only some fraction of customers have the time and patience to get them to fulfill their end of the deal. My approach is one call, and if they don't fix it, go to the state insurance commissioner's office. Those folks have contacts and get results, IME.

I haven't experienced that to-date. But it wouldn't surprise me.

In 2023 my first order of Tier 5 drug through Aetna Caremark Part D required signing up for an additional account at CVS Specialty. That was required, but once done, things moved along after clicking a few buttons. The first order required a credit card, and someone called me for that. I don't recall being able to enter that manually. But the card was saved, so next orders went smoothly. The first two orders were $3400 approximately, then approximately $1000.

When the time required for refill was on the horizon, I received regular text messages with link to renew. I used that, and a regular login process worked also.

The shipment(s) were UPS, in a large box, and they always arrived a day early. Tracking was provided. What was interesting is that no signature was required. Previously, under group insurance, the hospital pharmacy sent a driver with the Rx. Always had to sign...

If you have concerns about porch piracy, have the Rx sent to your local pharmacy.

I was transitioning from BCBS group insurance to Part D last year (just half a year), so this was my first significant experience with Part D plan. I had a lot of angst as my co-pay was going from $5 monthly to the numbers above.

I am familiar with the hold and hangup challenge. I try to avoid that as much as possible. Even going to the local pharmacy is something we try to avoid.

 

[Donno]

The shipment(s) were UPS, in a large box, and they always arrived a day early. Tracking was provided. What was interesting is that no signature was required. Previously, under group insurance, the hospital pharmacy sent a driver with the Rx. Always had to sign...

I have been using CVS Specialty Pharmacy for probably close to 10 years, and I'd caution you to always place your order where it is delivered as early in the week as possible if your medication is refrigerated. I have had my medicine delayed a few times over the years, and the first time it was due to arrive on a Thursday, but was delayed and didn't arrive until Monday. When I opened the box, the medication was hot since the ice packs had completely melted, and it must have sat in the back of a truck over the weekend in the middle of the summer. CVS replaced it at no cost to me, but it took another two days before I got it. I now place my orders to be delivered on a Tuesday and a couple of times it has been delayed by a day or two, but the ice packs held up.

 

[target2019]

I have been using CVS Specialty Pharmacy for probably close to 10 years, and I'd caution you to always place your order where it is delivered as early in the week as possible if your medication is refrigerated. I have had my medicine delayed a few times over the years, and the first time it was due to arrive on a Thursday, but was delayed and didn't arrive until Monday. When I opened the box, the medication was hot since the ice packs had completely melted, and it must have sat in the back of a truck over the weekend in the middle of the summer. CVS replaced it at no cost to me, but it took another two days before I got it. I now place my orders to be delivered on a Tuesday and a couple of times it has been delayed by a day or two, but the ice packs held up.

Good tip!

I only have pills, and no refrigeration needed.

 

[Trooper]

Thanks everyone for the great advice thus far.

In 2023 my first order of Tier 5 drug through Aetna Caremark Part D required signing up for an additional account at CVS Specialty. That was required, but once done, things moved along after clicking a few buttons. The first order required a credit card, and someone called me for that. I don't recall being able to enter that manually. But the card was saved, so next orders went smoothly. The first two orders were $3400 approximately, then approximately $1000.

Thanks - DW's drug will likely be a specialty pharmacy drug as well. However your cost info seems to contradict the $3300 OOP max mentioned above. Is the $3300 maximum per shipment?

I have been using CVS Specialty Pharmacy for probably close to 10 years, and I'd caution you to always place your order where it is delivered as early in the week as possible if your medication is refrigerated. I have had my medicine delayed a few times over the years, and the first time it was due to arrive on a Thursday, but was delayed and didn't arrive until Monday. When I opened the box, the medication was hot since the ice packs had completely melted, and it must have sat in the back of a truck over the weekend in the middle of the summer. CVS replaced it at no cost to me, but it took another two days before I got it. I now place my orders to be delivered on a Tuesday and a couple of times it has been delayed by a day or two, but the ice packs held up.

I second the good tip. DW's drug requires refrigeration also.

 

[target2019]

Thanks everyone for the great advice thus far.

Thanks - DW's drug will likely be a specialty pharmacy drug as well. However your cost info seems to contradict the $3300 OOP max mentioned above. Is the $3300 maximum per shipment?

I should have separated 2023 vs. 2024 thoughts in a clearer way.

In 2023 there were costs for each shipment. This includes other drugs, but Tier 5 was the biggie. You see the 2023 OOP costs getting capped below.

Your “out-of-pocket costs”
$0.00 month of December, 2023
$7,400.00 year-to-date (since January 01, 2023)

For 2024, I'll have to find EOB's, and so on.
January shipment was $3326.58.
February shipment - no charge on CC.

I take this to mean that I've hit the $3300 limit.

Maybe next week I'll venture in to the Medicare site...but why ruin a perfect weekend now?

 

[Trooper]

I understand now. It was I who was confusing 2023 and 2024. Yes I would take that to mean you've hit the $$3300 limit for 2024.

Maybe next week I'll venture in to the Medicare site...but why ruin a perfect weekend now?

LOL!