Medicare is a federal health insurance program that provides coverage to people aged 65 and over, as well as those with certain disabilities and chronic conditions. Medicare is divided into different parts, including Part A, B, C, and D, each covering different types of healthcare services. Medicare Part D specifically covers prescription drug coverage.
If you are a Medicare beneficiary, it's important to understand the True Out-of-Pocket (TrOOP) costs associated with Part D prescription drug plans. TrOOP refers to the total amount of money you pay for your medications out-of-pocket before you reach catastrophic coverage. In this blog post, we'll provide an overview of what TrOOP is, how it works, and why it's important to monitor your TrOOP costs if you have a Part D plan. We'll also offer some tips for lowering your TrOOP costs, including switching to a different Part D plan, using generic drugs, and applying for extra help.
TrOOP stands for True Out-of-Pocket (costs). It's a term used to describe the total amount of money you pay for your prescription drugs out-of-pocket while enrolled in a prescription drug plan. TrOOP includes all costs associated with prescription drugs, including deductibles, copayments, and coinsurance.
TrOOP is used to determine when you qualify for catastrophic coverage under your drug plan. Part D plans - whether you have a stand-alone plan or one is included in your Part C (Medicare Advantage) plan - have four coverage phases.
Once you reach the TrOOP threshold, you'll pay a small percentage of the cost of your drugs for the rest of the year. The TrOOP threshold is calculated annually and typically increases each year.
Prior to reaching the TrOOP threshold, you'll be responsible for paying a percentage of the cost of your medications until you reach the coverage gap, commonly referred to as the "donut hole." The coverage gap is a temporary limit on what your Part D plan will cover for prescription drugs. In 2023, the coverage gap begins once you and your plan have spent $4,660 on covered drugs and ends once you have spent $7,400 out-of-pocket.
Once you've reached the TrOOP threshold, you'll qualify for catastrophic coverage. This means you'll pay only a small percentage of the cost of your medications for the rest of the year. Once you reach catastrophic coverage, you'll pay no more than 5% of the cost of your drugs for the remainder of the year.
Understanding your TrOOP costs is important because it can help you manage your prescription drug expenses. Once you've reached the TrOOP threshold, your out-of-pocket expenses for prescription drugs will decrease significantly. Until then, you'll be responsible for paying a percentage of the cost of your medications, which can add up quickly.
It's important to monitor your TrOOP costs throughout the year to ensure you're on track to reach the catastrophic coverage threshold. You can track your TrOOP costs on the Medicare.gov website or by reviewing your monthly Part D plan statements. If you switch from one Part D plan to another during the year, your TrOOP will follow you - you will not have to start over.
Let’s talk about a few ways you might be able to lower your prescription costs throughout the year.
One way to lower your TrOOP costs is to use generic drugs whenever possible. Generic drugs are typically less costly than brand-name drugs and are required by the Federal Drug Administration (FDA) to have the same effects as their brand-name counterparts.
If you have limited income and resources, you may qualify for Extra Help, also known as the Low-Income Subsidy (LIS). Extra Help can help pay for your prescription drug costs, including your premium, deductible, and coinsurance expenses. To see if you qualify, visit the Social Security Administration's website or contact your local Social Security office.
Many drug manufacturers offer patient assistance programs that can help lower the cost of your medications. These programs may provide discounts, coupons, or free medication to eligible individuals. To see if you qualify for a patient assistance program, contact the drug manufacturer or speak with your healthcare provider.
Our agents at Local Medicare Specialists are experts in Medicare and can provide you with guidance on choosing the right Part D plan for your needs and budget. Contact us today to learn more about TrOOP and how we can help you make informed decisions about your healthcare.
Schedule a FREE Medicare plan consultation with an agent in your neighborhood.
LocalMedicareSpecialists.com is privately owned and operated by LMS Insurance LLC. LocalMedicareSpecialists.com is a non-government resource for those who depend on Medicare, providing Medicare information in a simple and straightforward way.
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area which are United Healthcare, Aetna, Humana, Cigna, Blue Cross Blue Shield of Arizona, Centene, Devoted, and Scan. Please contact Medicare.gov, 1-800-MEDICARE, or your local State Health Insurance Program to get information on all of your options.