Are You Overpaying for Prescription Drugs? New Analysis Says Yes!

Are You Overpaying for Prescription Drugs? New Analysis Says Yes!

A new analysis of twelve frequently- prescribed drugs illustrates that Medicare recipients frequently overpay for their medications.  Because Medicare doesn’t negotiate drug prices, there are wild swings in prices between Part D drug plans.  The difference in cost for the same drug can be in the thousands of dollars for the most expensive drugs and hundreds of dollars for more common prescriptions.

Although Medicare has an annual Open Enrollment period from October 15th – December 7th — when beneficiaries can compare drug plans and switch to lower costing drug plans — few retirees actually do so.  In most areas of the country, the average Medicare beneficiary has more than two dozen Part D plans to sort through and frequently doesn’t know where to begin.  Few are aware that free unbiased help is available locally to help select the best plan.  Consequently, Medicare beneficiaries wind up overpaying for prescriptions that could be obtained for a lower cost from a different drug plan.

Advisor editor Mary Johnson, who volunteers as a Medicare navigator during Medicare’s Open Enrollment period, has been studying the variation in costs for three years.  She compared the lowest and highest cost between drug plans for a list of 12 frequently-prescribed drugs.  This year the list includes commonly prescribed brand name and specialty drugs, as well as two widely-used generics.  The analysis found:

  1. The difference in drug prices between the lowest and highest costing plans, can be in the hundreds, or even thousands of dollars. For brand name and specialty drugs, the most frequent reason that the drug costs so much more in the highest costing plan is lack of coverage.  The drug is not listed on the high-cost plan’s formulary.  For example, the lowest cost plan for Sovaldi, a drug used to treat Hepatitis C, charges $5,600 in co-insurance (for a one-year treatment).  The highest cost drug plan charges $100,800, the full cost of the drug because Sovaldi is not on the plan’s formulary.
  2. New Part D plan drug pricing programs may lower costs for those who seek out the savings. Recent Congressional scrutiny on drug pricing may be spurring some drug plans to drop prices on certain drugs, but it takes comparing plans to find the best choice.  One of the biggest cost-savings found is due to a new drug plan pricing program that lowers the cost of insulin.  In 2018, the lowest-cost Part D plan charged an $80 copay for a 100/ML of Lantus Solostar.  But in 2019, the lowest cost plan charges copays as low as $6.00 - $11.00 for Lantus Solostar in the Cigna-HealthSpring Rx Secure — Extra Part D plan.  The highest cost plan, which does not cover Lantus, charges the full price, $383.18 per 100/ML.
  3. High premiums don’t purchase better coverage. The generic blood pressure medication, Lisinopril is one of the most commonly used prescriptions by Medicare beneficiaries.  The least expensive Part D plan has no copay for the drug, and the plan’s monthly premium is just $14.50 in the zip code used in the analysis.  The most expensive plan charges a co-pay of $9.19, and the plan has a monthly premium of $93.30.  Counting premiums, that’s a difference of $1,055.88 for the entire year.

To avoid overpaying for prescriptions and to find the most affordable coverage, the importance of comparing drug plans during your initial enrollment in Medicare, and during Medicare’s annual Fall Open Enrollment period (October 15th -December 7th) can’t be overstated.  Most people age 65 years and older take more than one prescription drug and, to get the best plan, consumers need to compare plans based on all the drugs they actually take.  In addition, consumers should compare prices between pharmacies, including mail order, which can also vary.

Free one-on-one assistance is available, to help compare and select plans, through state health insurance assistance programs.  Many of these programs operate through Area Agencies on Aging or senior centers.  Local program contact info can be found at