Why do the costs I pay for my drugs change throughout the year?
There are various reasons why your costs may change:
- If your dosage and/or quantity changes for a prescription, the cost may change. For example, if your doctor or other prescriber increases the quantity from one pill a day to three, you may pay more.
- There are times when the manufacturer increases the cost of a drug. If you are paying a percentage of that cost, then when the cost increases, both you and your plan will be paying more for the drug.
- The most common reason your costs will change depends on which coverage stage you are in. There are four different coverage stages for most Medicare prescription drug coverage plans. How much you pay for a drug depends on which coverage stage you are in.
1. Deductible stage.If your plan has a deductible (you’ll have to pay the full cost of your drugs until you meet your deductible).
2. Initial Coverage stage. Once you meet your deductible, you’ll pay a portion of the cost of your drugs and your plan will pay the rest. Once your total drug spend (what you pay and what the plan pays) reach $3,750 (in 2018) and $3,820 (in 2019) for the year, you move into the next stage.
3. Coverage Gap stage. During this stage, your plan generally covers a lower percentage of the cost of your drugs than in the Initial Coverage stage. You pay 44% of the cost of generic drugs, and 35% of the cost of brand name drugs in 2018 or 37% of the cost of generic drugs and 25% of the cost of brand name drugs in 2019.
4. Catastrophic Coverage stage. Once your out-of-pocket costs for covered drugs reach $5,000 (in 2018) and $5,100 (in 2019), you will be in the Catastrophic Coverage stage. Then you will pay either a 5% coinsurance on the cost of covered drugs or a copay of $3.35 (in 2018) or $3.40 (in 2019) for covered generic drugs and $8.35 (in 2018) or $8.50 (in 2019) for covered brand name drugs, whichever is greater.
Return to the Medicare FAQ section to view more answers to other commonly asked questions about Medicare prescription drug coverage.