Medicare’s catastrophic drug insurance can be a catastrophe for consumers

Journalist Philip Moeller, who writes widely on health and retirement, is here to provide the Medicare answers you need in “Ask Phil, the Medicare Maven.” Send your questions to Phil.

The Ask Phil (e)mailbox has been overflowing of late. I will get to as many questions as I can here, but please accept my apology for not being able to answer all of your questions.

Penny: I will turn 65 in July 2017. I buy my insurance from my employer. I have chronic myelogenous leukemia and take a very expensive drug. The pharmaceutical company has an assistance program that pays me the 20 percent copay that is not covered by my employer health insurance. I understand that I will not get copay assistance when I am on Medicare. This would be a huge problem. I could continue working and still get the assistance payments. But this illness is exhausting, and I would love to retire at 65.

Phil Moeller: Penny, I am so sorry to learn of your struggles with CML. It is an awful disease, and I wish you all the best. Your prospective payment problems highlight some of the real craziness in U.S. drug pricing and how Medicare Part D drug plans work.

It strikes me as puzzling, if not disingenuous, that pharmaceutical companies can defend their often high drug prices as necessary to spur continued research, and yet, at the same time, they have enough spare cash lying around to fork over big assistance payments to people like Penny. I suspect the reason this is so is because Medicare Part D plans virtually guarantee drug companies that they will enjoy wonderful paydays for their drugs when patients move from private health insurance onto Medicare.

Medicare does not permit private payment assistance plans to help pay for drugs for Medicare beneficiaries. It considers such payments to be a form of bribery — possibly causing patients and doctors to use medications that might not be the most effective in treating patients’ medical conditions and also more expensive than other medically acceptable treatments. Unless this prohibition changes, Penny will not be able to continue using this assistance and will have to rely on the rules of Medicare Part D plans to help her afford her medication.

Read more: PBS

Philip Moeller

Philip Moeller is a research fellow at the Center on Aging & Work at Boston College and co-author of “How to Live to 100.”

He wrote his latest book, “How to Get What’s Yours: The Secrets to Maxing Out Your Social Security,” with Making Sen$e’s Paul Solman and Larry Kotlikoff. He is now working on a companion book about Medicare.

Follow him on Twitter @PhilMoeller or e-mail him at

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