Reducing what Medicare actually costs you

Part D formularies and premiums change every January, and a plan that was cheapest for your prescriptions last year is frequently not the cheapest this year. Re-shopping takes about fifteen minutes with a full medication list and often saves several hundred dollars.

Check that each drug is on the formulary at the tier you expect, that your pharmacy is in network, and that no prior authorization has been added. The $2,100 cap on covered drug spending protects you from catastrophe, not from a plan that does not cover a drug at all.

Four programs are chronically underused. Medicare Savings Programs, run by the states, pay the Part B premium and sometimes the deductible for people under an income limit. Extra Help, the federal low-income subsidy, sharply reduces Part D costs.

State pharmaceutical assistance programs help with drug costs in some states, and the Supplemental Nutrition Assistance Program matters more to a household budget than any premium difference. Eligibility is based on income and resources, and the limits are higher than most people assume.

Higher earners pay more for Parts B and D, based on a tax return from two years earlier. If your income has dropped since that return, because of retirement, the death of a spouse, divorce or the sale of a business, you can ask Social Security to use more recent information.

The request is made with form SSA-44, and it must be tied to a qualifying life-changing event. It is not a hardship application, and it is not automatic. Filing it when you qualify can recover a substantial monthly amount.

A zero-premium Advantage plan is not free; it moves cost to copays, and it caps your exposure at the plan’s out-of-pocket limit. A Medigap supplement costs more per month and then largely stops billing you at the point of care.

Which is cheaper depends on how much care you actually use and on your tolerance for a large bill in a bad year. The right question is not which premium is lowest, but which total cost you can live with in the worst year.

Annual wellness visits, screenings and most vaccines cost nothing under Part B, and many Advantage plans add dental, vision, hearing and fitness benefits that go unused. Schedule the preventive visit, use the allowance before it resets, and check whether your plan offers a nurse line instead of an urgent care copay.

Finally, request a rate review every year at renewal. We run one for every client, free, because a carrier’s increase is not the same as the best available rate for the same coverage.