Between 15-26% of California Health Advocates’ (CHA) hotline calls this past summer were concerning Part D coverage, particularly questions about what to do when reaching the coverage gap referred to as the “donut hole.” Several callers were angry or in tears about not being able to afford their medicines and finding little recourse for help. One client exclaimed: “You know what this means? I can’t take my diabetic medications!” Unfortunately this is a choice a substantial number of people may face. A recent Kaiser Family Foundation report found that overall 1 in 4, or 26%, of beneficiaries who filled prescriptions in 2007 ended up in the “donut hole” or coverage gap. This equals approximately 3.4 million beneficiaries. (Note: these figures exclude beneficiaries with the low-income subsidy because the coverage gap does not apply to them.) Only 4% ultimately reached the catastrophic coverage while the other 22% remained in the coverage gap for the rest of the year.(1)
The percentage of beneficiaries who reach the coverage gap is even higher for those who have serious chronic conditions. For example, 64% of beneficiaries taking medications for Alzheimer's disease, 51% of those taking oral anti-diabetic medications and 45% of patients on antidepressants reached the coverage gap in 2007.
What do beneficiaries do in this circumstance? What recourse is available to them? Similar to what we are hearing from callers, the report found that:
- 15% of Part D enrollees who reached the gap stopped their drug therapy for that condition;
- 5% switched to another medication in the class; and
- 1% reduced the number of drugs they were taking in the class.
The few beneficiaries who think they may be able to afford buying their drugs and reach the ‘catastrophic level’ of spending (which is $3,216 in 2008) are encouraged to continue buying their drugs through their plan since their purchases then count toward their true out-of-pocket (TrOOP) costs and thus they reach this catastrophic level. Yet even when people qualify for catastrophic coverage, it’s only a matter of months before the year ends and a new plan year starts. Hence another cycle begins – with beneficiaries first paying the Part D deductible, then 25% of the initial Part D coverage and then… into the donut hole again….
Others who can’t afford to pay the $3,216 in drug costs during the donut hole and are faced with changing their medication use can explore the myriad of other resources such as pharmaceutical assistance programs (PAPs), the Co-Pay Relief program, prescription drug discount cards, or online pharmacies to help cover their drug costs. All these programs may or may not help and many have their own loop holes. This article discusses the first of these two resources, some of the benefits and challenges of these resources/strategies, and reviews a recent proposed piece of legislation that would change Medicare’s prescription drug program.
Resources/strategies for clients in the Part D donut hole
Pharmaceutical Assistance Programs (PAPs)
Many pharmaceutical companies offer some prescription assistance to qualified applicants. Several websites and organizations help people research and find a PAP for one or more medications; many of these websites/organizations are listed in the prescription drug resources section of our website. Note: If a PAP pays for a beneficiary’s drugs, the PAP’s payment will not count toward the beneficiary’s cost-sharing in his/her Medicare Part D plan.
As discussed in a previous article, some of these programs help people with Medicare Part D (who do not qualify for the low-income subsidy (LIS)), and some offer assistance for only certain drugs. RxAssist.org, a website created by a non-profit, Volunteers in Health Care, has a helpful webpage listing which companies accept Medicare beneficiaries. The webpage’s 4 sections outline companies that: 1) don’t accept any people with Medicare; 2) only accept Medicare beneficiaries without Part D; 3) accept all Medicare beneficiaries (regardless of having Part D); and 4) accept all Medicare beneficiaries but only cover selected medications. When researching PAPs, this document is a good first place to start. This page was also just recently updated in early September 2008.
Finding and applying to PAPs can take time, persistence and patience. Each program is different and in some cases even within the same company, different drugs may require a different application process. Most applications can be done either online or by phone and some require additional information from your doctor, financial documents to verify income, and/or proof of not being eligible for the Part D LIS, such as a denial letter from Social Security. In addition, some programs require beneficiaries to have spent a certain amount of money on prescription drugs for the calendar year before offering assistance.
For example, GlaxoSmithKline’s GSK Access program requires an applicant to have spent at least $600 on drugs, while AstraZeneca’s AZ & Me program requires an applicant to spend at least 3% of their annual income. Also, the application-to-approval time varies by program, from 2 days with the GSK Access program to up to 6 weeks with some of Merck’s PAPs. Once someone is approved, some programs give a person access to free refills for the remainder of the calendar year, while others require a new application every 90 days.
In addition to RxAssist.org, some other helpful website/programs to research PAPs include:
- Medicare can tell you which PAP covers your drug, who qualifies and how to apply. Call 1-800-MEDICARE (1-800-633-4227) and ask for assistance, or visit medicare.gov/pap.
- NeedyMeds.com - This website allows you to enter your medication to find patient assistance programs for that specific medication. You can search by brand name or generic drugs, or by program or company name as well. It has an alphabetical list of approximately 1,000 prescription medications.
- Partnership for Prescription Assistance - pparx.org – Partnership for Prescription Assistance offers a single point of access to more than 475 public and private patient assistance programs, including more than 180 programs offered by pharmaceutical companies. You can also access the Partnership for Prescription Assistance by phone at 1-888-4PPA-NOW (1-888-477-2669), sponsored by PhRMA (the Pharmaceutical Researchers and Manufacturers of America).
A program of the Patient Advocate Foundation, Co-Pay Relief provides direct financial assistance to qualified insured patients, including people with Medicare Part D who have certain medical diagnoses. These diagnoses include: autoimmune disorders (such as rheumatoid arthritis, Crohn’s disease, and ulcerative colitis); several forms of cancer, macular degeneration, multiple myeloma, diabetes, and secondary issues as a result of chemotherapy.
Different from PAPs, Co-Pay Relief pays by diagnosis, rather than by drugs. Also, even if a person has multiple conditions, Co-Pay Relief only covers a person’s primary diagnosis. Each of their covered diagnoses has a set grant amount, or ‘award’ available for each recipient to use within a 12-month period. If someone uses up their award before then, s/he must wait until 12 months from their approval date to apply again. Grant amounts range from $2,000 for breast cancer to $5,000 for pancreatic cancer. Awards can also be used to help pay any outstanding bills a person has incurred within a 12-month look-back period as part of their pharmaceutical treatment.
To qualify, a person must: 1) have one of the covered health diagnoses; 2) have health insurance that covers and pays a portion of the bill; and 3) currently be in treatment or have been in treatment within the past 12 months. For Medicare beneficiaries, Co-Pay Relief pays the Part D copayments or co-insurance when a beneficiary is still in the ‘initial coverage’ of the benefit, and pays the total cost of the related drugs during the Part D coverage gap, or “donut hole,” up to the award amount.
This program can be of great assistance to beneficiaries with these conditions who are unable to afford the cost of their drug treatments during the “donut hole.” In 10 out of 15 covered diagnostic categories, Co-Pay Relief’s award amount is greater than the $3,216 of out-of-pocket spending required to meet the Part D catastrophic coverage amount.
The challenge with this program, however, is that Co-Pay Relief can only accept a limited number of patients in each diagnostic category each month. Once that number has been reached, they ‘close the doors’ and tell people to apply on the 1st business day of the next month. In fact, many times the program fills up the first day or within the first few days of the month. For example, by the 4th business day of September 2008, all but 3 categories (those being multiple myeloma, myelodsyplastic syndrome and sarcoma) were already full.
For best results, beneficiaries are advised to call at 8 a.m. (11 a.m. Eastern Time) on the first business day of the month to apply. Their phone number is 866-512-3861. Beneficiaries, or people representing beneficiaries, i.e. family members or doctors, can also fill out an application online.
Patient assistance programs for generic drugs: Two such programs are Rx Outreach and Xubex Pharmaceutical Services. As outlined on RxAssist.org, these programs differ from all other patient assistance programs in that the pharmaceutical manufacturers of the drugs do not offer them. Instead they’re offered by companies who purchase large quantities of generic drugs and then offer them for a fee to qualified individuals with low-incomes.
Rx Outreach offers more than 125 different medications treating a variety of conditions including diabetes, asthma, heart disease, and depression. The drugs are available in a 90 day supply at a cost of $20, $30 or $40, depending on the medication. In order to be eligible, a person’s household income must be below 300% of the Federal Poverty Level. Rx Outreach information and applications can be found both at Rx Outreach and RxAssist.org.
Xubex makes 97 medications available and has 2 pricing levels, depending on the medication: $20/$30 for a 90 day supply, $40/$60 for a 180 day supply and $80/$120 for a 360 day supply. Xubex adds a $3.85 shipping and handling fee for each order. Income eligibility levels for this program as well as a comprehensive list of medications covered for both programs are listed online.
Also, visit our website for a detailed list of other resources and cost-saving strategies.
A proposed bill to change Medicare’s prescription drug program
"If Medicare were able to use its negotiating power to strike a better deal with drug companies, not nearly as many people would be in the ‘donut hole,’" said Ruben Burks, Secretary-Treasurer of the Alliance for Retired Americans.
Burks’ quote mirrors the opinion of many Medicare advocates. In fact, Representative Dennis Kucinich (D-Ohio) recently introduced a bill (HR 6800) that would replace the Medicare prescription drug benefit with a new program in an effort to reduce costs. The legislation would require Medicare to negotiate directly with pharmaceutical companies for discounts on prescription drugs and eliminate copayments, premiums and deductibles for medications for beneficiaries. In addition, the bill would limit the price of prescription drugs developed through publicly funded research and allow the purchase of medications from an approved list of foreign nations. Co-sponsors from California include: Rep. Barbara Lee, Rep. Bob Filner, and Rep. Lynn Woolsey. Those who support such a change are encouraged to contact their Congressional representatives at https://forms.house.gov/wyr/welcome.shtml.