2020 Part D Drug Costs
The Centers for Medicare and Medicaid Services (CMS) has released the 2020 costs for a standard Part D prescription drug plans.
Here are the highlights for the CMS defined Standard Benefit Plan changes from 2019 to 2020. This “Standard Benefit Plan” is the minimum allowable plan to be offered by insurance company who has a contract with Medicare to offer Part D prescription drug insurance.
- Initial Deductible:
will be increased by $20 to $435 in 2020.
- Initial Coverage Limit (ICL):
will increase from $3,820 in 2019 to $4,020 in 2020.
- Out-of-Pocket Threshold:
will increase from $5,100 in 2019 to $6,350 in 2020.
- Coverage Gap (donut hole):
begins once you reach your Medicare Part D plan’s initial coverage limit ($4,020 in 2020) and ends when you spend a total of $6,350 in 2020.
- 2020 Donut Hole Discount:
- Part D enrollees will receive a 75% Donut Hole discount on the total cost of their brand-name drugs purchased while in the Donut Hole. The discount includes, a 70% discount paid by the brand-name drug manufacturer and a 5% discount paid by your Medicare Part D plan. The 70% paid by the drug manufacturer combined with the 25% you pay counts toward your TrOOP or Donut Hole exit point.
For example: If you reach the Donut Hole and purchase a brand-name medication with a retail cost of $400, you will pay $100 for the medication, and receive $380 credit toward meeting your 2020 total out-of-pocket spending limit.
Medicare Part D beneficiaries who reach the Donut Hole will also pay a maximum of 25% co-pay on generic drugs purchased while in the Coverage Gap (receiving a 75% discount).
For example: If you reach the 2020 Donut Hole, and your generic medication has a retail cost of $40, you will pay $10. The $10 that you spend will count toward your TrOOP or Donut Hole exit point.
Minimum Cost-sharing in the Catastrophic Coverage Portion of the Benefit
You will be charged $3.60 for those generic or preferred multisource drugs with a retail price under $72 and 5% for those with a retail price greater than $72.
For brand-name drugs, You would pay $8.95 for those drugs with a retail price under $179 and 5% for those with a retail price over $179.
Maximum Co-payments below the Out-of-Pocket Threshold for certain Low Income Full Subsidy Eligible Enrollees: will increase to $3.60 for generic or preferred drug that is a multi-source drug and $8.95 for all other drugs in 2020. [Read more about these programs]
If you live in Maine or New Hampshire and would like to learn more about the new Medicare plans for 2020 or to go over the changes in your plan, you can call me at (207) 370-0143 or CLICK HERE to send me an email message.
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