Medicare Part D For 2022

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This is the Truth Network. Welcome to Finishing Well, brought to you by cardinalguide.com, with certified financial planner, Hans Scheil, best-selling author and financial planner, helping families finish well for over 40 years. On Finishing Well, we'll examine both biblical and practical knowledge to assist families in Finishing Well, including discussions on managing social security, Medicare, IRAs, long-term care, life insurance, investments, and taxes. Now, let's get started with Finishing Well. Finishing Well is a general discussion and education of the issues facing retirees. cardinalguide.com, cardinaladvisors, and Hans Scheil CFP sell insurance. This show does not offer investment products or investment advice. Welcome to Finishing Well with certified financial planner, Hans Scheil, and here we are.

We're going to be talking about 2022. So, the name of today's show is actually Medicare Part D for 2022, which that's a mouthful. And immediately it makes me want to think about kind of where I went with this as I was thinking about today's show topic of why I'm so glad that I have Christ as my Savior and why I'm so glad he sent me the Holy Spirit, because there's two verses that really speak to this from my point of view. You know, in Hebrews 4.14, you know, they give us, 4.15, excuse me, for it says, you know, we don't have a high priest who cannot be touched with our feelings or our infirmities, but in all ways was tempted as we are, and yet without sin. In other words, he knows all the things we're feeling, but by the same token, you know, he knows the rules.

And he understands the situation. And then you may have, you know, one of my favorite things to do actually as I pray every day is to ask the Holy Spirit, you know, as it says to do that groaning for us with prayers that are deeper than words, because the Holy Spirit and Christ know what we need more than what we know what we need. And so as Hans goes through this Medicare Part D, let me just start off by saying that as I reviewed this content, I was so glad that I had somebody I could trust that could simplify it down to the point of, okay, here's what I need to know.

I need to know what my drugs are and how that's going to fit into my plan for 2022, and I need to know, you know, where I can save a hundred bucks or a few hundred bucks. I mean, and so I think you're going to find that out by listening to today's show. But more importantly than that, I'm sure you would agree is to know that we have a high priest in Christ and we have the Holy Spirit that understand this stuff better than we do.

And man, we need to lean on them. And so let's lean on Hans right now for Medicare Part D. Yeah. So this is probably the area.

It's not probably. It is the area that you're going to get the most grief or you're going to experience the most grief around the whole Medicare program and your supplemental insurance. And people are upset about this many times. The reason for that is it's what just kind of everybody on Medicare or most everybody is taking some drugs, some prescription drugs, and they're dealing with this day to day to day to day. And there are difficulties when you're getting your drugs paid for or not paid for or you have big, a big you know, when the pharmacist has been asking for 30 bucks for a copay and then all of a sudden that copay is 362 bucks and you're going like, wait a minute, you know, then the people go home and they call us and they told them to hold on to the drugs. And so if there's any area where we get some, some complaints, it's really around this, okay, it's the Part D, it's at the drugstore, it's at the pharmacy, you know, it's when somebody develops a serious illness, and they're going to take some specialty drug, and then they find out really how their Part D plan works. Some of that speaks to how well the Medicare supplement and Medicare work together. Because on the medical side and the hospital side, your Medicare and then a supplement or your Medicare Advantage plan tend to do very well in paying for medical and hospital expenses. And they do so well, people are so happy.

They're kind of used to that. And then when they get down to the drugs, they have some difficulty and so it all gets channeled into that. So what we want to do today is just kind of explain to you what in the world's going on with Medicare Part D. And you know, in this open enrollment season or annual enrollment season, and October 15 to December 7, how that applies to the Medicare Part D plan and really what you need to do and what you don't need to do as it relates to prescription drugs. That's the nice thing about Part D is at least they named one of them that seemed to have something to do with what they're talking about. Well, that's good.

And it's just really they named it Part D, because D follows A, B and C. And that's just a coincidence. But anyhow, yeah, that is a plus. And so the first thing we need to get clear on is if you have a Medicare Advantage plan, if you're on one of those Advantage plans, and you have it with AARP, UnitedHealthcare, or you have it with Humana or Aetna or Blue Cross or one of the other big carriers that you get all your hospital, you got to go to the network doctors and all that, more than likely, your Part D plan or your drug plan is just part of that plan.

It's just like an add on. And you really didn't have choices in this matter when you signed up for it, because you just got whatever Part D plan is attached to your Medicare Advantage plan. It's still important for you to learn about it and what your options are. But you may not be as familiar with it because you didn't individually make a purchase of that.

It was all part of a package. Now, if you're on Original Medicare, and you have Part A and Part B, and you have one of those red, white, blue cards, and you don't have to mess with the networks, and you have big deductibles and copayments, but you have a separate private Medicare supplement policy, then what you have, well, first of all, that supplement policy, you can deal with that anytime of year. It's just people do a lot of that during this annual enrollment because they're talking to us anyhow. But you can change that and make adjustments anytime of year on the supplement. But the Part D plan for you, you at some point bought that Part D plan, or you chose the Part D plan that you have, and you now have the option during this annual enrollment time that if you wanted to move to another Part D plan, you could do that. And then it'll take effect January 1st. So what we really are going to do today is we're just going to go through and explain to you, like, what in the world's going on with this stuff?

And then secondly, what are your options? With this Medicare Part D, the government dictates to these companies a standard minimum benefit. And the standard minimum benefit, you know, in other words, when UnitedHealthcare makes their Part D plan, or WellCare makes their Part D plan, I think that's the one that you have, Ravi.

So they file them back in the summer or the spring with Medicare. And they say, Okay, this is what our Part D plan is going to be for 2022. They've worked with the government has put out these minimum benefits. So you know, they're saying your drug plan has got to at least do this at a very minimum. And then most of the companies do better. So why don't we just first go over what the what the minimum benefit is. And I don't know of a single company that has a policy right at the minimum, but let's go over that.

Yeah. So the first thing you've got for 2022 is you have a $480 annual deductible. And what that means is you don't get any benefits for your drugs until you've accumulated $480 in drug costs.

Okay, that doesn't sound very good. But for the people that pay the full deductible, you know, because there are people that have to do this, because some of the drug plans make you incur this thing, and they're going to do it for the the drugs and the special tiers. So in any case, it's a $480 annual deductible. And then after that deductible, you have 75% coverage, or in that means you pay 25%, up to $4,430. And so in drug costs, so you know, you say, Well, what's up with this 4430? Well, it's actually only 25% of the 4430 that you're going to pay out of your pocket.

And again, well, let's just go over the standard plan. And then after 4430, imagine this, then you're now in the coverage gap. And you've got 75% coverage.

And boy, that's confusing. And even the lady that I do my prep work with in the video, she says, Well, why is there this 75% up to 4430? And then after 4430, it's 75% again. Yeah, if you've ever heard of the doughnut hole, in which most people have that have ever read an article about this, is that 4430, you enter the doughnut hole, or the coverage gap.

There's just one thing is a few years ago, they essentially closed the doughnut hole. So you got 75% coverage up to 4430. And then you got 75% coverage after 4430. Until you're out of pocket, the money you've paid out equals $7,000 7050.

And then after you've paid that much out of your pocket, you got 95% coverage. I mean, you start throwing these numbers of people, I probably got a few of you confused already. Yeah, I was the first time I looked at it, I was out to lunch somewhere.

That's why I started out by saying we need a great I breathe and understand this stuff. But the other part that I think is critical to understand is that most of the part D plans, the coverage is better than this, right? Oh, it is. Yeah, it's much better than this. And let me just throw one thing before we do the break. Let me just simplify this is you got a $480 annual deductible.

Once you pay that you got 75% coverage until you've paid a little over $7,000 out of pocket, then after that you got 95% coverage. Does that sound simpler than everything I just said in the five minutes before that? Of course, of course, but okay, and that's, that's a re simplification of the whole thing. But yeah, and I think, you know, when we get on the back of the show, or the second part of the show, then we're going to talk about what these, what these plans really do, the actual plan you're going to buy, because it's better than what we just talked about. Yeah, and that's significant. Because again, you're going to find out at the end of this, there's options and things that that really, really will be helpful to you.

Because again, what's for the whole world doesn't necessarily matter is what is this going to mean to me, and we're going to get down to that. And that's the reason why Hans does these, and he wrote the book, The Complete Cardinal Guide to Planning for and Living in Retirement, that again, is there at cardinalguide.com, which, you know, has Hans's email address there at cardinalguide.com. If you want to get the book or you or you want any of this content, all the podcasts or previous shows, etc, etc, is all there at cardinalguide.com. But if you go to Hans's YouTube channel, which is cardinaladvisors.com, there you can watch other videos along these lines, even the board that shows all this information in great detail. So that's all available. All the resources is as clearly Hans's heart that we understand this stuff so that we can make better choices and be better stewards of what God gives us.

So when we come back, we're gonna have more of Medicare Part D for 2022. Stay tuned. Hans and I would love to take our show on the road to your church, Sunday school, Christian, or civic room. Here's a chance for you to advance the kingdom through financial resources by leveraging Hans's expertise in qualified charitable contributions, veterans aid and attendance, IRAs, Social Security, Medicare, and long term care. Just go to cardinalguide.com and contact Hans to schedule a live recording of Finishing Well at your church, Sunday school, Christian, or civic group. Contact Hans at cardinalguide.com.

That's cardinalguide.com. Welcome back to Finishing Well with certified financial planner, Hans Scheil. And today's show is Medicare Part D, which means drug plan for 2022.

And so the good news is Hans, you know, the real stuff that people get isn't what we just described for the most part, right? That's correct. Okay, so we got the standard minimum benefit, but we'll just start out with the deductible. Most plans do not have the $480 deductible.

A few do, but most of them is left for starters. You know, it's like 200 bucks or 240 or some number. And then the deductible doesn't apply to it. So many people that have a deductible don't experience it. So let's just talk about formularies. Each plan has their own individual formular. Now these formularies are approved by the government. What a formulary is, is it's just a list of drugs that are covered by the plan. And the government requires each of these plans to have at least one medication in every treatment category. So you don't have to look and see if your condition is covered on the formulary because they're going to have more than one drug typically that'll cover you in each of these areas. And most of these plans have four tiers. You know, in tier one are generic drugs.

It's just, and that's what most of us are on. If we just have routine kind of chronic conditions and they're, you know, they're, they're fairly inexpensive, the co-pays for the generic. And many of these plans don't apply the deductible, even if they have one, they don't apply it to the first two tiers of the plan. I mean, tier two are the preferred brand name drugs.

So now you've got a brand name drug. It's not a generic, but it's on the preferred list means that they made a deal with the pharmacies or whatever, and they can get that somewhat reasonable and it'll probably have a little higher co-pay than the generic drugs. But many of the plans for tier one and tier two drugs don't, you know, they don't apply the deductible. And then tier three is what they call non-preferred brand name drugs, you know, and so that's, those are going to be drugs that they can't get inexpensively.

You know, like something like Xarelto or something. I'm just not saying that for any one plan, but many times that's a tier three drug, which is a brand name drug. And so it's going to have a pretty stiff co-pay on it. And then furthermore, many of the plans make you pay the deductible.

You get anything for that drug. And then the tier four is where the really expensive drugs, the high cost drugs or the specialty drug, a lot of these biologicals for cancer and that sort of thing are going to fall under the tier four. And you know, if you're on a tier four drug, the last thing you're going to be worrying about is the deductible because you're going to, you know, rack up some pretty big expenses. The next point that I want to make is that generally you don't have to pay this 25% of your bill. You know, in other words, there's 75% coverage as a minimum and then 25% paid by you. Most of the time that 25% is just a co-pay and you don't have any way of knowing what percentage of the whole cost of the drug.

It's just 10 bucks or 20 bucks or 30 bucks or five bucks. So that's stated on most plans as a co-pay. Same thing once you're in the donut hole, you've got co-pays, but some of the plans get into a percentage. So if you've ever tried to understand any one person's claim, you're almost going to need to call me because it, when you dig into the stuff here and the pharmacists don't understand it, they just plug it in the computer and they tell you what it is. They're not going to be able to tell you why it is. It can be very confusing. And the purpose of this show is to explain a bit about what you're dealing with here, but more importantly, to outline the decisions that you have in front of you, because your particular drugs may be treated better on a different plan than you're on.

You can go on medicare.gov. You can do this whole thing yourself, but their software is not really all that slick at doing it. I mean, it can put out confusing reports. So we have a privately based software that has all the plans and we can plug in your drugs and then run the software against all the plans.

And then it spits out a report to us and ranks the plans based upon a projected total annual cost. Right. And my understanding is you, you, you put in the name of your pharmacy as well, because certain pharmacies. Oh yeah.

Well, yeah. Then you got the preferred pharmacies and that, you know, that affects the tiers and the charges. So, um, most of these plans have two, three or four, some of them have one, but two, three or four preferred pharmacies. So wherever you want to buy your drugs and wherever you regularly buy your drugs, that's where we're going to start in the software. And we're going to, you know, like if you say, I go to Walgreens, okay. And then if you put in Walgreens, um, and then it's going to run Walgreens against all the different drug plans and the ones that have Walgreens as a preferred pharmacy, then you're going to get, uh, the, you know, it's going to show a lower cost. Um, and it'll be a lower cost.

Now that's somewhat in your decision. Sometimes people with the software say, well, I'll go anywhere to get my drugs where I can get the best deal. And then we'll go back in and we'll look and we'll plug in Walmart. We'll plug in CVS or, you know, plug in, uh, Kroger or Harris Teeter over somewhere. And then, you know, the plans are going to shine that worked at Harris Teeter then. So it's pretty complicated to sit around and do this by hand or just call up a bunch of people and say, Hey, what you got?

I can't even imagine. And so a, you're going to find somebody that has the right software and then b, they got to know how to use it, right? Well, yeah. And then somebody who's licensed in all 50 States and the district Columbia to write these part D drug plans. Cause I was, you know, what we'd like you to do is after you compare everything available to you. One of the reasons we do this without a charge is that people then after that, if they're going to make a change, they do it through us. And then we use that same software. We just plug them in and enroll, you know, right over the phone and they can sign it on their cell phone. Um, so it's a pretty easy deal once they engage us.

So the, the place where it gets a little more complicated, right? Because let's take my case, for example, like I'm looking at switching from, and since we're in the annual enrollment period comes up October 15th. Right. And so now I can switch from, I'm on a supplement and I'm getting original Medicare, but I'm thinking about going to a Medicare advantage plan, which would change my plan D too. Right. And so now we're going to make sure that I kind of am getting the right Medicare advantage plan is more important than the drug plan, but it's all part of it.

Right. So what you're doing is leaving a Medicare advantage plan. Um, we actually leaving a standalone PDP, uh, prescription drug plan, and you're going to a Medicare advantage plan that is going to include a part D plan. So in your situation, um, we're going to need to look at the part D plan, but that's not going to be how the part D plan performs is not going to be your only decision when you make the change. Cause you're going to also look at how they cover your doctors and hospitals and that sort of thing. Now, when you have a person or one of our listeners, if you're sitting here listening to this and you're on a Medicare supplement and you have a standalone prescription drug plan, you can go in and compare and look at all the other prescription drug plans available. If you're not satisfied with your drug codes, I mean, if you're satisfied, you know, it's probably not going to be, um, that earth shattering to run all this computer report, um, and look at all the other ones cause there's pretty good chance they're going to treat them, treat you about the same way, the one you have now. So this isn't, you know, something you just need to do every year, every year, but we're just going over it.

Cause most people really don't understand their plan. And if you want to get in touch with us and have us really explain this in your situation personally, just like we're doing for Robbie, you know, you can either go in on our website, cardinal guide.com and ask, uh, ask us for service. And perhaps you could include a list of your drugs and then you could also include the doctors that you use, the names of them or the clinic and any hospital you go to. And if we have that in advance, um, and the pharmacy too, right? Yeah. And the pharmacy that you would like to pick, um, you know, if you send in an email, if you don't want to send all that in and you just want to say, Hey, here's my name and number.

I want to talk about this on the phone. That's fine too. We just get real busy this time of year.

And if you could send us what we need, um, and include maybe the plan you're on now, what your situation is now, you give us a little bit of background, you know, when we actually do talk, we can have something ready for you. Right. So this annual enrollment period starts October 15th, but yet you guys already have these plans for 2022, even though the enrollment period starts, but the plan won't start until next year, right?

Correct. I mean, any changes that are made from October 15th to December seven will take effect January 1st. And so the information became available for us on October 1st. And then, so if you write into us this week, um, we can get back to you. We can't actually write one of these things or make a change till October 15th, but we can do all the prep work.

And in fact, this is a good time to call in because a lot of people are going to wait till after October 15th and we're going to be slammed by that or even worse till November 30th. Yeah. Yeah.

We always have some of them and we, you know, we pray with them and we, you know, bless them and then we get them what they need. Um, yeah, I understand. So again, it, it, you know, what we're talking about today is simply the Medicare part D for 2022. And, you know, as you said, it's, it's a lot of things are much more important than your part D plan is to, is to make sure you get the healthcare you need. But, but this is a way to be a good steward of those dollars. And the place you really, really feel like you help people is the people that are on the expensive cancer drugs, right?

Oh, sure. And none of us know when that's going to happen to us. Um, and if, if it does, I mean, all of these plans, you're going to get into what's called the coverage gap or the donut hole. And it does matter which plan you're on because some of them do better than others. You know, you really can't, if that's going to happen to you down the road, you know, you can't anticipate that and you can always change this every year.

This might be some information you just file. If you're in that situation now where you're on some biologicals or some tier four drugs, tier three drugs, and your current plan is not handling them very well, well then you can make a change during this period and get to a better one. And that change will take effect January 1st. So we can set you up for next year in much better shape.

Right. And it's just a question that I know, you know, the answer to, but I don't, you know, say, you know, next February you get diagnosed with some type of horrible cancer and all of a sudden you, you find yourself in this lurch. Aren't there some provisions for you as well in that situation? First of all, if you're on a plan and you're on a part D plan, they all cover those. Perhaps you'll get lucky in that you're on one of the better plans any, but if you're not and yours covers it not as well, there's, there's really not much you can do other than just go along with it. Sometimes the drug manufacturers of those very expensive drugs will work, you know, work out a program for people, especially people where there's a financial hardship from this.

So there are some things you can do, but specifically with the plan you're on, unless you move or your physical, you know, personal residence or that kind of thing, you're pretty much stuck with whatever you end up with all year. Okay. You can see why it's kind of important to look at all this information. Again, you can get Hans' book, Complete Cardinal Guide to Planning, Foreign Living, and Retirement, all there at cardinalguide.com. And remember, YouTube's videos are at Cardinal Advisors on YouTube. So thank you, Hans. Great show.

Vital information right now. Thank you. Finishing Well is a general discussion and education of the issues facing retirees. cardinalguide.com, Cardinal Advisors, and Hans Schleil CFP sell insurance.

This show does not offer investment products or investment advice. We hope you enjoyed Finishing Well, brought to you by cardinalguide.com. Visit cardinalguide.com for free downloads of this show or previous shows on topics such as social security, Medicare, IRAs, long-term care, life insurance, investments, and taxes, as well as Hans' bestselling book, The Complete Cardinal Guide to Planning, Foreign Living, and Retirement, and the workbook. Once again, for dozens of free resources, past shows, or to get Hans' book, go to cardinalguide.com. If you have a question, comment, or suggestion for future shows, click on the Finishing Well radio show on the website and send us a word. Once again, that's cardinalguide.com, cardinalguide.com. This is the Truth Network.