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Medicare 2017: What You Need to Know

by Elizabeth Davis on October 11, 2016 at 3:15 pm

With Medicare open enrollment right around the corner, you may be wondering changes are in store for your Medicare plan in 2017. We have the latest info on what to expect, and how you can make the most of your Medicare coverage.

When is open enrollment?

Medicare plans offer open enrollment from October 15 to December 7. Medicare health and drug plans can make changes to cost and coverage each year, and open enrollment gives you a chance to change your plan if needed. This lets you pick the coverage that works best for you.

You will need to pick a plan and sign up during open enrollment to avoid a monthly penalty added to your plan.

What’s changing in 2017?

  • More plans than ever will have a preferred pharmacy network—85% in 2017. This isn’t a huge change from last year, but it’s been growing steadily since 2011 when only 7% of plans had a preferred network. A preferred pharmacy network means that your plan will offer greater savings at certain pharmacies—although in most cases you can still go elsewhere if you’re willing to pay a higher price.
  • Your premiums are going up—maybe. Medicare premium increases are tied to the Social Security “cost of living adjustment” or COLA, which is tied to inflation. Last year, in 2016, there was no COLA, so premiums didn’t increase across the board. It looks like there may be a small increase in 2017, but we won’t know for sure until the Social Security announcement later this month.
  • Most costs will increase slightly. The initial deductible will be $400 in 2017, up from $360 in 2016, the initial coverage limit will increase from $3,310 to $3,700, and your out-of-pocket maximum will go up from $4,850 to $4,950.
  • Some good news for the donut hole. The coverage gap between the initial coverage limit and the out-of-pocket max is what’s commonly known as the “donut hole.” During this time, you’re responsible for a percentage of your drug costs. In 2017, your share is actually going down. For brand name drugs, you’ll pay 40%, compared to 45% in 2016. Your share of generic drug costs is also going down, from 58% to 51%.

What is Medicare Advantage vs Medicare Part D?

  • Medicare Advantage (sometimes known as Part C) can be confusing. Medicare Advantage plans are offered by private companies approved by Medicare. Your Medicare services (medical and prescription) are actually covered through your Advantage plan, rather than through original Medicare. Most Advantage plans include prescription coverage.
  • Medicare Part D plans, on the other hand, offer a separate prescription drug benefit that you can add on to your regular Medicare coverage. Part D plans are also regulated by Medicare, but are offered by private companies and do not come standard with original Medicare plans.
  • Takeaway: the big difference between Part D and Advantage plans—Part D is a prescriptions-only add-on, while Advantage plans cover medical services as well.

How can GoodRx help?

Whether you’re choosing a new plan, or you have your 2017 coverage locked in, it still pays to shop around. For the top 20 Medicare plans in America, 66% of prescription drugs can be purchased for less than your typical Medicare co-pay using discounts found on GoodRx.

When will GoodRx have 2017 plan information up?

GoodRx gets our Medicare information directly from the Center for Medicare and Medicaid Services (CMS). CMS does not release new plan prices until the new year, but we expect to to have 2017 Medicare plan and pricing information early in 2017.

For now, you can compare prices for your prescriptions on your 2016 plan by searching for your prescription and choosing your current plan information here.

What else should I keep in mind?

Just because a drug is covered by a Medicare plan doesn’t mean the plan will make it affordable. Over 44% of prescriptions have coverage limitations which can prevent Medicare consumers from affording their prescriptions. like doctor authorizations, quantity limits and more. GoodRx lets you know about the “fine print” which plans won’t tell you about in advance.

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