Most Medicare Part D Enrollees Don’t Choose the Lowest Cost Drug Plan

Most Medicare Part D Enrollees Don’t Choose the Lowest Cost Drug Plan

Medicare choices have expanded over the past few years. Medicare Part D and other Medicare options come in every shape, size and amount. In some cases, the more you pay, the more you get. In others, this is not true. And in still other cases, if you don’t pick the right plan, you won’t end up with the right coverage for the right medication.

At present, Medicare offers beneficiaries a choice between over 40 prescription drug plans in each state. In some counties there are even over 70 different plans to choose from. Seniors can examine and research the plans and determine the one with the best coverage for their prescription drugs.

A new study found that most Medicare Part D enrollees don’t choose the best priced option. Trying to figure all the plans out can be quite confusing and at times exhausting and exasperating.

Fewer than 10 percent of seniors chose the lowest cost plan offered in their area in 2006, according to an analysis of 55,000 individuals who had a Part D claim in 2006. The enrollees who didn’t choose the lowest priced plan could have saved an average of $520 on their monthly premiums and out-of-pocket expenses if they had done so. And only 10 percent of seniors chose one of the five percent of plans with the lowest costs, which would typically have resulted in $400 in savings. About half of part D beneficiaries (53 percent) did enroll in one of the lowest cost 25 percent of drug plans. Other seniors could have saved an average of $220 if they had done the same.

Many factors besides cost alone most likely influenced the senior’s decisions to enroll in higher priced plans including a strong brand name, good reputation, fewer utilization restrictions, or even a convenient in-network pharmacy. In addition, there is the old adage “You get what you pay for” and many seniors most likely took that view when deciding what plan to enroll in.

The Centers for Medicare & Medicaid Services (CMS) has a tool to help you figure out what plan would most likely be the best for your situation. You can enter the drugs you expect to take next year and compare the expected out-of-pocket costs under the various plans in your area.

If you are determining which plan you should enroll in, be certain to use the CMS calculator and see which plan will save you the most money.