Monday, January 23, 2006

The Medicare Part D "Donut Hole" Is Bad; The Medicare Web Site Execution Is Incompetent

by Tom Bozzo

There's a very good series on the Medicare prescription drug benefit (a.k.a. Medicare Part D) by Michael Hiltzik at the L.A. Times blog (also linking to an earlier, and also excellent, article in the series from last week). Take your blood pressure meds and read it.

One seemingly shocking observation from the article, also excerpted by Kevin Drum, isn't quite what it seems to be, though. Hiltzik, apparently using the plan comparison feature on the Medicare web site, priced supplies of the osteoporosis drug Actonel, and found a typical monthly price — as a beneficiary in the coverage-free "donut hole" might experience — of around $500, with considerable variation by plan. That compares to around $70, cash, from various Web-based suppliers.

The health care system may be f***ed up, but it's not that badly f***ed, yet.

The culprit turns out to be the Medicare web site. Potential beneficiaries can fine tune drug plan cost comparisons, which otherwise are all but useless given the multiplicity of choices and out-of-pocket cost parameters, by specifying the medications they routinely take. Users may then enter specific dosage information, or let the site base its cost comparison on typical dosing amounts. The dose used by default for Actonel is 30 35-mg tablets. However, 35-mg Actonel is taken weekly, so this is a database error specifying 7.5 times the normal dose. Since Actonel pills are rather expensive, this is a big error. In the site design, a user would have to scroll past various plan information and notice the crazy monthly quantity to figure out that something was amiss.

The error, as it turns out, isn't obviously innocent. Having input my ZIP Code and Actonel and Lipitor as medications to be costed out, the defaults yield a low-cost plan with annual costs of $1,407, with the next least expensive plan costing nearly twice as much out of pocket. What a deal! But using the correct dose, the low-cost plan was around $750, and the $1,407 plan under the default scenario was... still $1,407, but now one of the more expensive options in the lengthy menu.

Somehow, I can just imagine that among the other pieces of wreckage, there will turn out to be some bad ex-post choices of drug plan out there.
I found a prescription discount card to use while in the donut hole. It's at Low membership fee. Drug prices posted to see before you sign up.
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