Shh… don't tell anyone I'm poor. They all think I'm living frugal and green just like everyone these days. This is a blog about a senior citizen living a frugal life, on a fixed income, in a low income food desert, and passing along knowledge from lessons learned. Some she learned from her Grandma Mama many years ago and some learned only a few days ago.
I found out that the letter and the phone call from my insurance company were legitimate. It was the wording that had me confused and cautious. I listened to the phone conversation and read the letter but I got it all wrong. Geeze, why can’t they just speak plain words like everyone else?
Here’s how the review process works according to my understanding so far:
A doctor is concerned about your health but not your pocket book. (I say she but it could be he) She prescribes medications for your ills but has no idea if you can afford them or not. You could tell her constantly that you’re low incomed but that actually means nothing to her other than a bit of sympathy and maybe a few samples.
Your doctor can write a prescription one of two ways. 1.) The prescription is to be filled “as written” with a brand name medication only. 2.) The prescription may be filled with a generic version with the same ingredients if one is available. As everybody knows, generics are cheaper than brand name. I didn’t know this about prescriptions. I really believed a pharmacy always chose the cheaper version if it was available. I guess all those years on state medicaid ruined my perception of how the insurance works. Now that I’m no longer a medicaid recipient I’m learning some hard lessons. The pharmacy is also in the business of making money. They prefer to sell the higher cost name brands because it gives them the greatest profit. The pharmacy is very happy when a doctor writes a “brand name only” prescription.
Unless you specifically ask your doctor that your prescriptions to be written allowing a generic then the doctor will always choose the brand name. Prescribing the brand name is beneficial to the pocket book of the doctor. The brand name companies offer kickbacks for each prescription filled. The doctor may not know of generic versions available either.
Your doctor knows about health issues but doesn’t know anything about your insurance plan or your plan formulary or your finances. You are concerned about your pocketbook but your doctor is not. She’s looking at health issues only.
What part D insurance companies have done is come up with a way to inform clients of generic alternatives for the brand name prescriptions when the doctor won’t or can’t. This is called a “review” of the medications and simply informs us that a generic is available when it is. If the doctor either can’t or won’t tell you of a generic version then your insurance company certainly will. Here’s why.
Your insurance company wants you to save money so that they also save money. If a medication costs your insurance company $1500 but the insurance company knows there is a generic version with the exact same ingredient that will only cost them $700 then they want their client to know this too. That saves them money.
If, for example, you are responsible for 20% of the cost of your prescriptions then that means the insurance company pays the other 80%. That could be the difference between you paying the higher 20% of $1500 (brand name) and the lower 20% of $700 (generic). In other words you could be paying $800 for brand name medication or only $140 for generic. Your insurance company really wants you to know this difference because for them it saves both of you money. For the insurance company its the difference of paying $1200 for brand name and $560 for generic.
But there is also another factor to be considered which can be explained much better by the insurance company pharmacy specialist. That’s a thing called a “formulary tier” which is simply “how much you pay” for your prescriptions. So why the heck don’t they just say its how much stuff costs? Geeze, speak plan language.
A medication could be listed as a tier 1, 2, 3, 4, or even 5 depending on how your insurance company does their tier system. If I understand this right, a tier 1 is generic while the higher tiers are the brand names and the specialty medications.
A brand name is always going to be in the higher cost level because… well… it costs more. The higher tiers. Insurance companies really wants to keep its money just like we do. They will pass the highest amount allowed on to the client. At the same time the insurance company will encourage the use of generic medications by putting those medications on lower cost tiers. A generic may be put on a tier 1 which means you may pay only $1 instead of $140. Oh yes, I like that!
I looked up one of my medications in the formulary book. Then I looked online to see if there was a generic version and the name. Then I looked in the formulary book for that. Here’s what I discovered. One of my prescriptions which is a brand name. I pay 20% of the cost for that because its tier 3 on my plan. It costs me $89 each month. But… now get this…. the generic version of this same medication is on a tier 1 level on my plan and would cost me only $2 per month. YIKES! That is a whopping big difference. I could have been saving money all this time. I’m pretty sure that I could be saving a whole lot more because I have 6 brand name medications. I thought about looking online for a generic of those but decided to wait and let the pharmacy specialist do the work for me.
If you’ve been as confused about your part D coverage as I have been maybe this post will help clear it up a little. I learned alot and I hope I have maybe cleared up some things for you too. As of today, I think of the pharmacy specialist as being a frugal person just like me ready to tell me how to save money on my medications.
I’m definitely going to call the phone number given to me in the letter first thing Tuesday. I can’t call on Monday as I have plans with Ladybug.