Examples
Roger, age 82, has prescription drug costs of $700 each month ($8,400 for the year).
Roger has early Alzheimer’s disease, heart
disease, diabetes, acid reflux, high cholesterol, and
insomnia. He takes 10 medications, including
five generic drugs. His high costs mean that he
will go through the coverage gap and qualify for
catastrophic coverage protection. Even though he
will have to pay the total cost of his drugs in the
coverage gap, he will still save a lot of money
with his Medicare Prescription Drug Plan.
Roger has selected a stand-alone Medicare
Prescription Drug Plan that provides drug
coverage only. He already had Medicare Parts A
& B and a supplemental insurance plan to help
fill in the gaps in his Medicare A & B coverage.
He just needed a plan to cover his drugs. His
stand-alone drug plan includes:
For the first three months of the year, Roger’s
plan pays about 75% of his drug costs. When
Roger’s costs exceed $2,700 in April he enters
the coverage gap. He pays 100% of his drug costs
until he has spent a total of $4,150 out of his
pocket. In October, Roger’s costs reach this
level. At this point, Roger has reached the
catastrophic coverage level, and his drug plan
then pays 95% of his drug costs until the end
of the year. Having a Part D plan will save
Roger $3,600 in 2009.
Without insurance, Roger's annual cost of prescription drugs: $8,400
| |
Roger Pays |
Roger's Plan Pays |
Total Annual Rx Drug Cost |
| Annual Premium |
$348
($29x12 months) |
$0 |
|
| Annual Deductible |
$0 |
$0 |
$0 |
| Initial Coverage |
$675 (25%) |
$2,025 (75%) |
$2,700* |
| Coverage Gap |
$3,675 (100%) |
$0 |
$3,675 |
| Catastrophic Coverage |
101.25 (5%) |
$1,923.75 |
$2,025.00 |
 |
| Total Costs |
$4,799.25 |
$3,948.75 |
$8,400.00 |
|
|
|
|
Roger PAYS ($348.00 + $675.00 + $3,675.00 + $101.25) = $4,799.25
Roger SAVES ($8,400.00 – $4,799.25) = $3,600.75
* Trigger for coverage gap to begin
|
