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Commentary

Cutting through the confusion in Part D
Joseph R. Antos, Ph.D., AEI Online, 1-4-06

Antos advises seniors sorting through the Medicare drug benefit to focus on the bottom line: what is the least expensive plan that covers the medicines they need?

Faced with a bewildering array of options, millions of older Americans seem paralyzed by the prospect of selecting a plan offering the new Medicare prescription drug benefit. According to the Centers for Medicare and Medicaid Services (CMS), there is an average of forty to fifty Part D plans in each region of the country. That figure does not include drug benefits offered by private health plans in Medicare Advantage (MA), which could mean a dozen or more additional options for many seniors. Moreover, the details—deductibles, co-payments, coverage in the infamous doughnut hole, and drugs covered by the plan—are complex and vary greatly across plans. Choice is good, but does there have to be so much of it?

Although seniors have a large number of drug plan options from which to choose, most of those options are easily discarded by following the first rule of smart shopping—choose the lowest cost option that meets your needs. Rather than worrying about whether a plan requires a deductible or attempting to plumb the intricacies of multi-tiered formularies, people should look at the bottom line cost they would incur over the course of the year. Paying more than the lowest cost makes no more sense in this market than it does in other markets.

Antos' advice is well taken, and should help some seniors approach the program with more confidence.



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