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True Out Of Pocket Costs




TrOOP Costs

True Out Of Pocket costs include:

1.the deductible,
2.the 25% co-pay, and
3. the gap between the initial coverage level and the catastrophic coverage level.

True Out Of Pocket costs do NOT include:

1.the plan premium or
2.any medications NOT on the plan formulary.

TrOOP is the Medicare prescription drug plan beneficiary's (plan owner's/insured's) total liability for medication costs until the beneficiary reaches the Catastrophic Coverage

Catastrophic Coverage

(Costs over $3,850 TROOP limit)

Once the beneficiary's annual true out-of-pocket spending reaches $3,850 the beneficiary pays $2.15 for generic drugs, $5.35 for all other drugs or 5%coinsurance for covered drug-related costs.

Given the above definitions, how do they impact the plan purchasing decision?

If you have significant annual medication purchases, we believe the decision boils down to consideration of only two items: 1) The Plan Formulary and 2) The Plan Premium.  By significant, we mean your annual True Out Of Pocket costs will exceed $3,850. If that is your situation, then we recommend you purchase that plan that has the lowest premium with the formulary that best meets your needs.

Source: CMS Medlearn Matters Number: SE0618
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Jackie and Jim Spahr
call or fax toll free:
1.800.237.0107 fax  1.888.356.5956
Jackie Spahr  Jim Spahr