Use our Medicare Comparison Tool (Find A Plan) or the one provided by CMS Plan Finder (Medicare Plans) to calculate your annual cost. First check and ensure your drugs are covered in one of the two lower tiers – Generic (Tier 1) or Preferred Brand (Tier 2). At minimum, check to see if your drug is covered under Tier 3 – Non Preferred Brand. Watch out for a possible fourth tier called “specialty drugs.” Remember brand name and specialty drugs are not covered once you hit the donut hole. Your goal is to talk to your doctor about generics.

You will have to do a little homework here. Even if the plan does not cover your drug, you still benefit from a 10-20% discount over retail. Each plan is required to provide CMS with an electronic file every two weeks with their negotiated rate. The CMS site even includes the retail cost of the drugs for comparison. Your goal is to stretch your prescription drug benefit further by selecting the plan with the lowest negotiated rate for drugs. Remember your copayment and the negotiated rate of the drug are counted against your annual maximum benefit. The plan with the highest discounted rate will save you the most money.

Low Cost Alternatives are the single most important element in reducing your annual costs. These drugs are prescribed to treat the same condition and your doctor simply may not be aware of their existence. You can use our Medicine Cabinet Search Engine (Drug Prices) to find Lower Cost Alternatives. Your goal is to print this list and have a frank and honest discussion with your doctor about the medications he is prescribing. You both might be surprised to find out how much money you can save.

Start with the plan with the lowest deductibles and copayments. You are responsible for paying these “additional costs” along with your monthly premium. If the plan you’ve selected:
* does not cover your drug,
* covers it on Tier 3 or Tier 4 (Specialty Drugs), and/or
* the negotiated rate is less than 10% of retail

Any of these issues could bankrupt you at the end of the year. And it will be too late to realize you were getting zero value for your money.

Remember your monthly premium and deductible is considered “first dollar coverage” – what you pay before you access care. Your premium should gain you access to a comprehensive formulary and negotiated rates and copayments that are substantially less than retail. There is absolutely no value in choosing a plan that does not cover your drugs or offers copayments equal to or greater than the retail value.