![]() ![]() Medicare Part D enrollees not receiving low-income subsidies can expect to pay thousands of dollars out of pocket for a single specialty tier drug in 2019 (Figure 1).(See Methods for additional details.) Key Findings ![]() As such, our findings are broadly applicable to a majority of PDP enrollees nationwide. We use one zip code to represent PDP costs nationally because most PDPs are offered on a national or near-national basis (including 24 of the 25 PDPs in the 21201 zip code), and it is common for PDPs to use the same formulary and the same specialty tier coinsurance rate in all regions. For each drug, we calculate the median annual out-of-pocket cost across all plans that cover the drug, based on coverage in stand-alone prescription drug plans (PDPs) and costs at a pharmacy in zip code 21201 (Baltimore, MD). This analysis draws on data from Medicare’s Plan Finder website to calculate expected annual 2019 out-of-pocket costs for 30 specialty tier drugs used to treat four health conditions-cancer, hepatitis C, multiple sclerosis, and rheumatoid arthritis. While specialty tier drugs are taken by a relatively small share of enrollees, spending on these drugs has increased over time and now accounts for over 20 percent of total Part D spending, up from about 6 to 7 percent before 2010.ĭespite Medicare’s protections, Part D enrollees with serious health problems can face thousands of dollars in annual out-of-pocket costs for specialty drugs. Part D plans are allowed to charge between 25 percent and 33 percent coinsurance for specialty tier drugs before enrollees reach the coverage gap, where they pay 25 percent for all brands, followed by 5 percent coinsurance when total out-of-pocket spending exceeds an annual threshold ($5,100 in 2019). Specialty tier drugs-defined by Medicare as drugs that cost more than $670 per month in 2019-are a particular concern for Part D enrollees in this context. Medicare Part D has helped to make prescription drugs more affordable for people with Medicare, yet many beneficiaries continue to face high out-of-pocket costs for their medications. ![]()
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