By: Harry Thal
Special to the Sun
I have been writing a newspaper column for many, many years. First, for almost the lifetime of the Courier, and now in the Sun for the last several years. This is the first time I have made an honest mistake; if you can even call it that.
When the Sun came out last week, I received a phone call from the Drugstore in Kernville. They informed me that they had finally reached an agreement with WellCare and Aetna that they would be in fact, a participating “STANDARD” pharmacy as previously announced.
I had reported that they would not be participating. That was what we had been told and even confirmed. I was unaware that negotiations were still going on with the insurance company.
There are three types of pharmacies in the world of Medicare Part D. “D” like in drugs. The first is “non-participating.” If you present your ID card in this type of pharmacy, you will pay the full price of the medication and there is no insurance coverage. Another term for this is “out of network.”
The most common classification of a pharmacy is “STANDARD PHARMACY.” With a standard pharmacy you have a co-pay at all levels of drugs. The last type of pharmacy is “PREFERRED PHARMACY.” This is where you will find the best prices on the lower tiers of drugs, often $0.
Another pharmacy type is MAIL ORDER. In some instances, there might be “STANDARD MAIL-ORDER” and “PREFERRED MAIL ORDER”. You will need to check with your specific plan to determine which mail service is best for you. Contrary to logic, there are situations where the mail order pharmacy is more costly than your local retail pharmacy. Also, many independent pharmacies have lower prices than the large chain stores…go figure!
All medications covered by the Medicare Part D program are classified and put into “Tiers.” While the names of these tiers represent the majority of medications therein, it is often misleading. Tier 1 is labeled “Preferred Generics.” A preferred generic is typically a low-cost generic drug typically taken for maintenance purposes, such as a medication for blood pressure or cholesterol. You will often find this medication to have a small co-pay at a STANDARD pharmacy and a $0 co-pay at a PREFERRED pharmacy.
Tier 2 is often labeled “Generic” and will sometimes be $0 at a Preferred Pharmacy and have a higher co-pay at the Standard Pharmacy. Tier 3 is normally labeled “Preferred Brand”, Tier 4 is called “Brand” and Tier 5 is called “Specialty.”
While the first three tiers typically have a dollar co-pay, tier 4 and always tier 5 will have a co-insurance pay. A co-pay is expressed as a dollar amount while “co-insurance is a percentage of the retail price. For 2020 I warn people that in some plans, what was a co-pay in 2019 for tier 4 may be co-insurance in the 2020 policy.
Pharmacies also differ from one insurance plan to another. While SOME of the WellCare plans will be “Standard” at all area pharmacies in 2020, some WellCare plans will be Out-of-Network. Caution is warned. Other Medicare Part D plans will use the Drugstore as a “Preferred Pharmacy” with many generics at a $0 co-pay.
While I’m on the subject, on some plans you will find a sixth tier. Tier 6 is reserved for maintenance medications and are priced by some plans as a $0 co-pay. By shopping for the best plan, you can save money on your prescriptions.
I find the same thing with people in Medicare Advantage HMO plans. Several of the plans use the same network of doctors, have similar coverage and a $0 monthly premium, but the cost of the medication can vary. For example, one plan has a $0 co-pay for some insulin taken for diabetes, while another plan charges a high co-pay.
Lastly, our Harry P Thal Insurance Agency SCORECARD: In 2018 we began making a tally of how much we have saved our clients by shopping their prescription and Medicare Advantage plans. In 2018 we saved clients $755,452.70. For 2019 the savings was $669,779.50. We have just completed week two of the seven week “Annual Enrollment Period” and the savings to date is $34,039.34.
Harry P. Thal, MA, is a licensed insurance broker in California (0621106) and 27 other states. His offices are in Kernville. He may be reached at 760-376-2100, e-mail email@example.com or visit him on the web at www.harrythal.com.