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Medicare D Policies and Cost of Chronic Illness Medication: Ideas for Change 

By Carolyn Spence Cagle PhD, RNC-E

Twenty-five percent of retirees ages 65 to 69 take 5 daily medications, including costly brand name drugs, to manage their health. The high cost of prescription drugs continues to plague many Americans, including retirees with Medicare D policies. These plans lack annual limits on insured persons’ payment for drugs, including expensive ones to manage chronic illness.This differs from commercial (private) insurance plans under the Affordable Care Act that limit insured policyholders’ out-of-pocket drug payment to $7,900.00 each year. Once that limit has been reached, plans pay 100% of drug costs for insured consumers.

Retirees with a chronic disease may discover that valuable “cutting edge and targeted” drugs to control their disease are costly. Legislative changes to close the “donut hole” medication coverage gap this year have helped retirees with Medicare D plans that require them to pay 25% of brand name drug cost once they reach $5,100.00 out-of-pocket this year. After that, an insured retiree reaches the “catastrophic coverage” phase and pays 5% of brand name drug cost for each prescription. That 5% never disappears:for a person dependent on  a brand name drug that costs $5,000.00 each month, that 5% remains a heavy burden ($250.00 each month + the initial $5,100.00).  An annual cap on out-of-pocket expenses would help retirees with expensive chronic illnesses to purchase costly brand name drugs for illness management.

Relatively unknown, a federal program called Medication Therapy Management (MTM) may help retirees with complex prescription needs related to chronic illness. Created by the 2003 Medicare Prescription Improvement Act, the MTM includes a health professional (often a pharmacist) who provides a personalized review of retiree medications to prevent medication-associated problems. This review may identify unnecessary medications, incorrect medication dosing, drug-herb-vitamin interactions, and barriers (e.g., visual difficulties, unable to find pharmacy with lower costs, etc.) to taking prescriptions for maximal retiree benefit.  I like that the program focus is broad, aims to “deprescribe” (decrease unnecessary medications), and creates an action plan involving consumer, a health professional, and program professional to resolve issues to support consumer health. Many retiree insurance plans cover a MTM plan if one has 3 or more chronic illnesses, (Alzheimer’s’ diabetes, cancer, end-of- life issues, etc.), take up to 8 daily prescriptions, and likely to have total medication costs of $4,044.00 or more in 2019.   Check with your health plan to see if it covers an annually free phone MTM consultation or a face-to-face one.

With multiple individuals in the Presidential race, opportunities exist to propose creative and responsive strategies to manage high drug costs for all consumers, including retirees. Now seems to be a great time to write letters to your Congresspersons to advocate for “just” prescription prices. It is also a perfect time to become involved in Presidential candidate forums to express your views on the prescription drug costs based on your experience and those you know!

What proposals are “on the table” now to respond to the costly prescription drug issue, according to the AARP?

  • Setting a spending cap on drugs covered by Medicare D policies: President Trump and Senator Ron Wyden (D-OR) support this idea along with more retiree use of cheaper generic drugs. However, some believe those drugs may lack the more targeted approach of newer brand name drugs preferred by chronically ill consumers. AARP also supports in its initiative, “Stop RX Greed Now,” the spending cap.
  • Giving the federal government the ability to bargain with drug makers about product pricing, behavior limited by the 2003 Medicare bill that crafted Medicare D policies to cover outpatient retiree drug costs (many countries with national health programs have drug review boards that negotiate with drug makers for fair pricing)
  • Allowing consumers to buy lower cost Canadian drugs for personal use, rather than paying higher prices for American marketed drugs.
  • Limiting drug maker ability to “rebrand” their initial drug (make small changes that allow maintenance of a drug’s patent) and allow that drug to become generic for cheaper retiree cost.
  • Increasing transparency of drug costs to support informed consumer choice to use a drug meeting their needs.
  • Improving “value-based pricing:” connecting the price of a drug with its clinical effect and value to consumers


Andrews, M. (2019, April 26). Doughnut Hole Closed, But Many Struggle with Medicare Drug   Costs.Retrieved from

Gill, L. L. (2019, January. How to pay less for your meds. Consumer Reports, 84(1), 47-50.

Marsa, L. (2019, May). A 5-point plan to lower rx prices. AARP Bulletin,60(4), 9-10, 12, 14, 16.

Wiley, F. (2019, April 30). A Little-known Way to Manage Your Meds. Retrieved from