Beware drug co-pays,
no-pays
USA TODAY
April 21, 2008 Monday
FINAL EDITION
For all the complexity of health insurance, the idea behind it is pretty simple. You and millions of other people pay premiums so that those who get sick will be protected, particularly if the illness is severe or debilitating. But increasingly -- and to policyholders' surprise -- that's not the case when someone needs the most expensive drugs.
Policyholders might find out only when they or a family member suffer a serious illness -- such as multiple sclerosis, rheumatoid arthritis or many types of cancer. Then they are faced with a financial catastrophe on top of a health crisis: Costs can run as high as $100,000 a year for some medicine needed to cope with a serious disease.
One example: Debra Minkkinen, a secretary for a suburban Minneapolis school district, discovered her vulnerability after her son, now 13, had surgery for a brain tumor. The follow-up treatment affected Kevin's production of growth hormones, so doctors prescribed drugs to take their place. While the Minkkinens' insurance set most drug co-payments at $25 per prescription, it put growth hormone in a special category, she told USA TODAY.
The cost per month under the family's policy was more than $500, or about 20% of the drug's price, up to a maximum of $4,000 a year. But every plan is different. Some charge higher percentages. Other drugs could cost more. People can end up on the hook for thousands of dollars a month. In extreme cases, they can be left paying the entire cost.
"It was a rude awakening," said Minkkinen. The family refinanced its house, added credit card debt and finally sought help from a patient assistance foundation. That assistance will last one year.
This sort of "tiered" drug pricing system -- now on the rise -- is a disturbing outgrowth of what started as a sensible idea. In the late 1990s, many insurers began charging patients a higher "co-payment" for brand-name drugs when generics were available. In 2007, the average co-pay in this type of private plan was $10 for generics and $23 for brand-name drugs, according to a survey by the non-profit Kaiser Family Foundation.
The idea was to encourage patients to use lower-cost, equally effective generics in order to control skyrocketing health care costs. But some insurers have taken that idea too far.
When a new Medicare drug benefit was introduced in 2006, some insurers began offering plans that placed a wide array of expensive medicine on a specialty tier, often called Tier 4. Soon, more plans followed that lead, and by this year, 72% of Medicare drug plans had four tiers, according to research firm Avalere Health. Since then, the practice has spread to insurance offered by employers. Today, Avalere found, about 10% of private employer health plans have a Tier 4.
America's Health Insurance Plans, the industry's lobbying group, argues that higher co-payments for expensive medicine help keep down the price of insurance for everyone. No doubt.
But that comes at a high personal cost for anyone who is sick -- or anyone who might get sick. Often, there are no equivalents on a lower-price tier for these expensive drugs. Quite simply, tiered systems make those who are the sickest pay the most. That's not how insurance is designed to work.
RETIREMENT AND ESTATE PLANNING:
What about health care?
If you are currently enrolled in the Local 547 Trust Fund health plans, you have options to consider when you plan for health care after retirement.
The Fund permits retiring members to continue their current health insurance coverage (health, prescription, dental and/or vision if enrolled) indefinitely under the same terms as members who elect continuing coverage under COBRA (the Federal law that allows continuing coverage at your own expense). The coverage is identical to your coverage as an active employee. After retirement, if the coverage to active employees changes, yours will as well with corresponding changes in premium rates. Prior to you or your spouse becoming eligible for Medicare, you must contact our office to discuss your health plan options.
You can continue coverage for yourself, your spouse, or both. If you and your spouse are both enrolled, your spouse may also continue coverage indefinitely after your death, under the same terms. The cost is the same as your employer paid(or you and your employer if you share costs) while you were working, with rates subject to change each year.
You should contact the Local 547 Benefits Office two (2) months prior to your retirement to obtain the most current information and allow enough time to ensure a smooth transition. Please feel free to contact the Benefits Office at (313) 532-2022, extension 31, for more information.
Healthcare Tips:
10 Ways to make the Most of your Next Visit to the Doctor
We all know that you can flip through quite a few magazines in the waiting room before your name is called and you finally get to see the doctor. And then you get only 10 minutes with him or her. It helps to go in prepared and to make productive use of your time there.
Paul Auerbach, M.D., a clinical professor of surgery at Stanford University and chair of the Healthline.com Medical Advisory Board, has developed a list of tips to help you make the most of an appointment.
- Prioritize and write down any questions you have before heading to the doctor's office. In case there isn't time to address all them, you will have asked what is most important.
- Educate yourself ahead of time about things like symptoms you're experiencing and what type of illness they might be associated with. The Internet is a great place to find this information - try www.healthline.com.
- Make a list of the medications you're currently taking or have taken recently and give it to your physician. Include the doses and schedule. If you aren't sure, bring the medication containers with you.
- Don't be afraid to ask questions. For example, if you're having tests like a CAT scan or an ultrasound, ask if an injection or fasting will be necessary. If you don't know what acronyms like CAT mean, ask about those too.
- Be prepared to answer questions about your medical history, including surgeries and immunizations. You may also want to make note of your family health history, such as heart disease or diabetes.
- If you already know you have a particular medical condition, learn as much as you can about it beforehand, so you will have an idea of what to expect. Again, the Internet has a wealth of information, but remember that not everything on the Web is trustworthy.
- Keep a notebook handy so that you can write down important information from your doctor. If you leave without writing something down, you may forget.
- Before you leave your appointment, ask your physician to recommend books, pamphlets or other information resources to help you learn more about health issues.
- When you arrive home, follow your doctor's instructions exactly. Remember, you're a key part of the health care team.
- Keep your doctor informed of any changes in your condition.
