The Plan Comparison - Analysis Explained

The Plan Information Section

This section of the plan comparison show the plan name. Each plan then has a Contact ID which is a unique code for the insurance carrier, and a Plan ID which is a code for the plan itself. The Plan ID is only unique in conjunction with the Contract ID. Therefore many of the carriers have a plan with the ID 001.

Your Total Annual Drug Plan Cost

In our example, the total annual costs are calculated as follows:

Example PDP Enhanced (Contract ID: EX1, Plan ID: 111)

Example PDP Value (Contract ID: EX2, Plan ID: 222)

Example PDP Standard (Contract ID: EX3, Plan ID: 333)

Information needed to make the calculation

Premium

$25.30/month

$26.40/month

$17.70/month

Deductible

$0.00

$295

Retail cost of medications

$197.44/month

$202.23/month

$197.44/month

When the Donut Hole will be reached ($2700 / retail monthly medication costs)

in Month 12
($2700/197.44)

in Month 12
($2700/202.23)

in Month 12
($2700/197.44)

Costs after Deductible and before Donut Hole (Initial Coverage Limit)

$144.54

$156.92

$49.35

Monthly expenditure calculation

Total Cost
Month 1:

Premium:	$25.30
Deductible:	$0.00
Co-Pay:	$144.54
Total:	$169.84.69

Premium:	$26.40
Deductible:	$0.00
Co-Pay:	$156.92
Total:	$183.32

Premium:	$17.70
Deductible:	$197.44
Co-Insurance:	$0.00
Total:	$215.14

Total Cost
Month 2:

same as Month 1: $167.69

same as Month 1: $179.27

Premium:	$17.70
Deductible:	$97.56
Co-Insurance:	$32.45
Total:	$147.71

Total Cost
Months 3-11

same as Month 1: $167.69

same as Month 1: $179.27

Premium:	$17.70
Co-Insurance:	$49.35
Total:	$67.05

Total Cost
Month 12

same as Month 1: $167.69

Premium:	$26.40
Co-Pay:	$156.92
Donut Hole:	$26.76.00
Total:	$210.08

same as Month 11: $67.05

Annual Total

$2,038.02

$2226.60

$1003.31

Fixed Cost Details Section

The fixed costs of the plan include those costs that do not change based on your medications. These include the monthly premium and the deductible.

Monthly Prescription Drug Premium

This is the monthly cost of the plan itself. This cost is paid to the insurance carrier. Many carriers offer

Social Security Check Deduction,
Automatic Bank Withdrawal,
Coupon Book (similar to a car payment. You receive a book of coupons that you send to the insurance carrier along with your check), or
Automatic Credit Card Payment

Deductible

The usual deductible is $295. Not all plans have a deductible. Please be sure to check the total annual plan costs, sometimes the plan with the deductible ends up being less expensive over the course of the year even though it has a deductible.

The insurance carrier, through your pharmacy, will keep track of your medication costs and where you stand in relation to your deductible. You do not need to keep track of this yourself.

Your Monthly Drug Costs after you have met your deductible but before your total drug costs reach the Initial Coverage Limit

The costs shown in this section are the per medication costs that you will pay to the pharmacy. This is either a co-pay (a flat fee based on the type of medication or its full retail price whichever is less) or a co-insurance typically 25% of the retail price of the medication.

In our example:

Cozaar TAB 50mg - in plan 1 this is a non-preferred brand drug and it's co-pay is more than it's retail cost, therefore the retail cost is paid. In plan 2, it is not on the formulary and therefore you must pay full price. This also does not count toward your deductible and out-or-pocket costs. In plan 3 (a 25% co-insurance is paid).

Tikosyn CAP 500mcg - is a Tier 3 (non-preferred brand) medication in plans 1 & 3. In plan 1 the co-pay is just slightly less that the retail cost. In plan 2, it is not on the formulary. In plan 3 the 25% co-insurance is paid.

WARFARIN SODIUM TAB 5MG - is a generic drug (all generics are shown in capital letters) In Plans 1 & 2 the generic co-pay ($7, $10 respectively) is paid. In plan 3 a 25% co-insurance is paid.

Vytorin TAB 10-40mg - in plans 1 & 2 this is a preferred brand drug thus the co-pay ($30, $40 respectively) is paid. In plan 3 a 25% co-insurance is paid.

The Monthly Cost is the total of all of the monthly co-pays or co-insurance. This amount is paid to the pharmacy.

The pharmacy will know which type of coverage you have based on your membership card information. They will tell you your co-pay or co-insurance amount. You do not need to keep track of this yourself.

This phase of the coverage is called the Initial Coverage Period. Most persons will stay within the Initial Coverage Period through out the year. The phase after the Initial Coverage Period is the Donut Hole or Coverage Gap.

Your Monthly Drug Costs after your total drug costs reach the initial coverage limit but before your total out of pocket expense equals $4350

This phase of the coverage is called the Donut Hole or Coverage gap. Some plan have Donut Hole coverage. If so, you will see reduced medication costs in this section of the plan comparison. Many plans only cover generic drugs in the Donut Hole.

The Donut Hole start when the full retail cost of your medications reaches $2700 and ends when the full retail cost of your medications reaches $6153.75. Once again, you do not have to keep track of where you stand in relation to the Donut Hole. The insurance carrier and pharmacy will keep track for you.

In our example, none of the plans has Donut Hole coverage, so we see the full retail price of the medications in this section. You may ask why the retail price is different for some of the plans. Each insurance carrier negotiates their own price with the pharmacies. Therefore the retail price is/may be different across insurance carriers.

The next phase of coverage is call Catastrophic Coverage and is the same on all plans from all carriers.

Your Monthly Drug Costs after your total out of pocket expense equals $4350

The Catastrophic Coverage is reached once your total out of pocket costs reaches $4350 (i.e. after the retail costs of your medications reaches $6153.75). In this phase of the coverage, you will pay the greater of $2.4 for generic or preferred brand drugs or 5% co-insurance. For all other drugs, you will pay the greater of $6 or 5% co-insurance.

In our example, we do not reach catastrophic coverage, so it is not shown.

Pharmacy Network

This is the number of pharmacies in your area (based on your zip code) who participate in the insurance carriers plan.

Mail Order

This states if the insurance carrier permits mail-order purchases in the plan.

Although not reflected in the plan comparison, some carriers offer significant discounts on 90 day supply mail-order, include 3 for 2 co-pays (i.e. you only pay the equivalent of 2 co-pays for a 3 month supply of medication.)

Drug Information Section

This is a new section of the plan comparison. It details for each medication how they fall in the plan's formulary.

In our example,

Cozaar TAB 50mg - is a Tier 3 (non-preferred brand drug) for plans 1 & 3. Because it has the asterisk (*) we see that it is subject to prior authorization, step therapy or quantity limits.

Tikosyn CAP 500mcg - is also a Tier 3 medication in plans 1 & 3 however it is not subject to limits. Neither of these medications fall in plan 2's formulary. This means that If you purchase this drug, you will pay the full price of the drug, and the amount you pay will not be counted towards your deductible or out of pocket cost limits. The plan may grant an exception and provide coverage under special circumstances. You would need to contact the plan for more information.

WARFARIN SODIUM TAB 5MG - is a Tier 1 (generic) medication in all three of our sample plans.

Vytorin TAB 10-40mg - is a Tier 2 (preferred brand) drug in all three of our sample plans and is subject to prior authorization, step therapy, or quantity limits in all three plans.