In our February, 2009 Newsletter, we provided a preview of the basic cost limits you could expect with your 2010 Medicare Part D plans.  The Centers for Medicare and Medicaid Services (CMS) has recently updated this information to include the final 2010 Medicare Part D plan coverage parameters.

These parameters include the cost limits such as the basic initial deductible, initial coverage limit (defining when the donut hole begins) and the out-of-pocket threshold limits (defining where the donut hole ends).

We now know that the 2010 Part D plan parameters will increase in 2010 by 4.66% as compared to the 7.54 % increase in 2009 values.  (As a note, in the February preliminary figures we expected a 3.13% increase in cost limits or plan parameters). 

A chart comparing the CMS Medicare Part D defined standard benefit parameters from 2006 through 2010 are available at Q1Medicare.com/2010. 

So what are the final changes for 2010?

• $310 Initial Deductible Limit:  If you have a Part D plan with an initial deductible where you pay 100% of your prescription costs before your Part D prescription drug plan begins to pay, you can expect an increase of $15 to $310 from the current 2009 initial deductible of $295.  Click here to see 2009 plan feature statistics on a national and state level.
• $2,830 Initial Coverage Limit:  When you purchase your medications, you will enter the 2010 Donut Hole or Coverage Gap when the total retail cost of your prescription drug purchases reach the initial coverage limit of $2,830, an increase of $130 over the 2009 Initial Coverage Limit of $2,700.  Most all plans use the standard initial coverage limit.  However, Medicare Part D plans do have the option to use lower (or higher) initial coverage limits.
• $4,550 True Out of Pocket Costs (the actual dollar figure you must spend to get out of the Donut Hole or Coverage Gap, excluding monthly premiums) -  The out of pocket threshold will increase by $200 to $4,550 in 2010 from the current 2009 value of $4,350.

How do these cost limits or plan parameter work in real life?

You can click here for an example of a Medicare beneficiary with relatively high prescription costs ($800 retail costs per month) as they move through their 2010 Medicare Part D plan - in this example, the person can anticipate total out of pocket expenses in 2010 of $4,696.38.

You can change the $800 value to your own prescription spending and the deductible (which is set at $0) to see a preview of your 2010 coverage.

Still not sure what all these numbers mean to you?  No problem, click here and let us know.

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