Medicare beneficiaries almost always have prescription drug coverage — either through a stand-alone Part D plan or rolled into a Medicare Advantage plan. So, why are so many people paying for prescriptions out of pocket instead of using their insurance?
The Commonwealth Fund, an independent research organization, delved into that question as part of its Health Care Affordability Survey.
The survey polled 2,077 Medicare beneficiaries who live in communities, rather than nursing homes or facilities, and asked how many had used online discount prescription drug websites or discount drug cards in the past year.
Approximately 1 in 5 said they had. And the reason was simple: It saved them money.
Discount pharmacies like Amazon, BlinkRx and Mark Cuban Cost Plus Drugs allow people to buy low-cost medications online for delivery. Meanwhile, the GoodRx discount card offers savings at local pharmacies.
The only catch is that if you use these options, you can’t also use your Medicare drug coverage. However, many people find the out-of-pocket price at a discount provider is lower than what they would pay when using their Medicare drug coverage.
Among survey participants with a Medicare Advantage plan who have used a discount drug website, 81% said it was cheaper than using their Medicare drug coverage. Meanwhile, 85% of those with Original Medicare, sometimes called traditional Medicare, say the same.
Original Medicare is offered directly by the government and includes coverage for both inpatient (Part A) and outpatient (Part B) care but not typical prescription drug coverage. People on Original Medicare must purchase a separate, stand-alone Part D plan from a private insurer if they want drug coverage.
Medicare Advantage plans are offered by private insurers and cover Part A and Part B and usually prescription drugs.
The Commonwealth Fund notes that a medication with a $400 retail value might cost a Medicare beneficiary $200 with their insurance. However, a GoodRx discount card might result in a price of $180, netting them $20 in savings.
However, the cost savings may not always be so clear-cut.
The Commonwealth Fund notes that in 2025, out-of-pocket costs for drugs covered by Part D will be capped at $2,000. That means beneficiaries will need to weigh the savings from a discount drug provider against reaching that out-of-pocket limit faster.
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