‘Health care as a human right’ is a key plank in Bernie Sanders 2020 campaign for the nomination as Democratic candidate for the presidency of the USA in the fall.

If he were to win his way to the White House, we can expect Bernie Sanders’ proposal ‘MEDICARE FOR ALL’ to be his flagship program.

So, first, what is ‘Medicare for all’ and why should we need it?

Medicare is a federal health insurance program for US citizens from the age of 65 and is funded from taxation (personal and corporate) and payroll deductions. Low-income families are covered by the federal and state programs Medicaid and the Child Health Insurance Program (CHIP).  For more detail see Medicare.gov. Read about Medicare Advantage Plans 2020 in our blog.

From age 26–65 all US citizens are obliged to have a health insurance plan that meets the minimum requirements of the Affordable Care Act (ACA). These are ‘private plans’ and maybe individual, family or group (normally employer-sponsored).

These are the programs that Bernie Sanders is seeking to replace with a single umbrella program embracing the elements Medicare Part A, Medicare Part B, Medicare Part C, Medicare Part D in a single all-embracing program, ‘MEDICARE FOR ALL’.

Some of his rivals for the presidential candidacy want to continue the personal choice offered by Medicare Advantage plans.

WHY is Bernie Sanders’ campaign 2020 so focused on Medicare for All?

Primarily because ‘Health’, whichever side of the fence you are on, it is a fundamental concern for all Americans (95% say Medicare is important to the country as a whole) and because it is a clear ‘single-issue’ which distinguishes the left from the right in the House of Congress and in the Senate.

What is it about the existing system that so concerns Bernie Sanders?  He cites: –

1. The effect on those sections of the population least able to insulate themselves from the financial impact of medical or care expenses
2. The high cost of administrating an over-complex system of service provision and cost allocation
3. The disproportionately high cost of medical treatment, medications (including prescription drugs) and care
4. The ‘excess’ profits made by the big pharmaceutical companies

His evidence: –

Under the existing system, there are approximately 28.5 million Americans who have no insurance coverage (U.S. Census Bureau).

It seems probable that up to 41 million Americans are underinsured and do not have health insurance coverage to meet the cost of traumatic medical treatment or long-term medication.

Over 60% of bankruptcies, (more than 500,000 families) are attributable in whole or in part to medical problems (American Journal of Public Health).

Some facts about Healthcare status in USA: –

In 2016, the health expenditure per capita in the US was $9,870 (W0rld Health Organization, WHO).  In the same report, the equivalent figures for Canada were $4,453 and the UK $3,958.

In the same year, 2016, the US spent 17.7% of Gross Domestic Product (GDP) on Healthcare (WHO). The equivalent figures for Canada were 10.53% and UK 9.76%.

One contributor to these extreme differences is the usage of prescription drugs.  The US spends over 1.5 to 3 times as much on prescription drug costs as other developed countries, (Journal of the American Medical Association, JAMA).  Read more about Prescription Drugs Plan Enrollment Medicare (Part D)

Another is the complex administration required to ensure that millions of health insurance claims are correctly processed and payments made to thousands of providers.  Administrative overheads are estimated to absorb 8% of the total healthcare budget.  The developed country average is about 2%.

Although he has long campaigned for a ‘single-payer’ national health insurance program to provide everyone in America (sic) with comprehensive healthcare coverage free at the point of service (Health Care as a Human Right, Bernie Sanders 2020) Bernie Sanders 2020 campaign has adopted the less contentious catch-phrase ‘Medicare for all’.

He goes on to say

• No networks, premiums, deductibles, co-pays, no surprise bills
• Medicare will be expanded to include: dental, vision, and home and community-based long-term care, in-patient and out-patient services, mental health and substance abuse treatment, reproductive and maternity care, prescription drugs and more
• Stop the pharmaceutical industry from ‘ripping off ’ the American people by making sure that no one in America (sic) pays over $200 a year for the medicine they need by capping what Americans pay for prescription drugs under ‘Medicare for All’.

How much would ‘Medicare for all’ plans cost’

Let’s start with the current cost.  There is a common agreement that the current government contribution to Medicare, Medicaid, and other health insurance programs is in the region of $1.3-1.4 trillion.

Estimates for the ‘Medicare for all’ plan cost and the premises on which they are based vary. Sanders himself (drawing on) Friedman (University of Massachusetts) claims the additional cost would be $1.3 billion.  At the other extreme, a 2016 report from the Urban Institute suggests that the annual additional cost of the Medicare for all program might amount to $3.2 trillion.

There is no doubting the Democratic party’s resolve to obtain the most favorable outcomes from the nation’s investment both public and private, in the healthcare of its population.  To convince their constituents, they must have a policy that values enterprise and recognizes that the demand for anything ‘FREE’ is infinite.

What is formulary? How do they affect me? What happens if they change?

Read all about Medicare Part D Formulary 2020 in this article.

What are the formularies?

In the context of Medicare drug plans (e.g. Prescription Drug plans, Medicare Advantage plans with drug coverage) the term Formulary refers to the list of drugs covered by a particular plan. Each plan has its own formulary.  Plans include both branded and generic prescription drugs.

Who determines the Medicare Part D Formularies?

‘Each plan that offers prescription drug coverage through Medicare Part D must give at least a standard level of coverage set by Medicare.

Plans can vary the list of prescription drugs they cover (called a formulary) and how they place drugs into different “tiers” on their formularies’ [drawn from Medicare].

The medications (prescription drugs) on your plan’s formulary are chosen by a panel of experts, the pharmacy and therapeutics committee (P&T) who are independent of the insurance companies.

How do formularies affect me?

It is tempting to think that your Medicare prescription drugs plan or Medicare Advantage prescription drugs plan will cover all your prescription drugs. It won’t!

Many health insurance companies freely publish their formulary. The Silverscript Formulary 2020 and the Humana Formulary 2020 are representative examples.  So too are the Cigna formulary 2020 and Aetna formulary 2020, but these insurance companies may not cover your State or county, or may not have a network of pharmacies that fits your circumstances.

You also need to be aware that tax benefits, i.e. the premium tax relief and state-aided benefits, are only available if you purchase your plan through a health insurance exchange, whether Federal, State or Private.

To take the fullest advantage of your plan coverage, you must select a plan (and formulary) that matches your expected usage of prescription drugs and make sure that you can fill your prescriptions at a network pharmacy.

If your prescription drug is not on your plan’s formulary you may have to pay the full price. [If your doctor or other authorized prescriber believes that none of the drugs on your plan’s formulary will be effective you may ask your insurer for an EXCEPTION.]

We referred earlier to ‘tiers’.

What are formulary ‘Tiers’ and how do they affect me?

Let’s be clear: all the drugs covered by your plan must meet the requirements of the MMC and FDA.

In particular, Generic or Multi-Source drugs must demonstrate that they are clinically as effective as the branded equivalent.  There may, of course, be a significant price difference.  Both you and your insurers have an interest in keeping the expenditure on drugs as manageable as possible without affecting your course of treatment.  Hence the need for formularies or lists of approved medications (prescription drugs) which your plan will (help to) cover.  When you have met your deductible you will not have to pay full price for further prescriptions during the plan period.

Now about the formulary tiers!

Your physician (or another qualified prescriber) will recommend a particular drug(s) according to your clinical needs.

Generally, these drugs are included in most insurers’ formularies and usually in more than one version.  There may be one or more branded versions and one or more generic versions. All of these must meet the standards of the MMC and FDA.

There can be up to five tiers but typically insurers divide their formulary drugs into four tiers: –

There may be some minor differences in the formulation of these medications BUT the major discernable difference will be the COST.

• Tier 1 of Formulary: Low cost generic drugs-Co-pay $20
• Tier 2 of Formulary: Higher cost generic drugs low cost branded drugs – Co-pay $4o
• Tier 3 of Formulary : Brand name drug with no generic alternative – Co-pay $60
• Tier 4 of Formulary: High cost/specialty drugs – Co-pay $100+

With some exceptions prescriptions are filled for a one month supply.  You can see that your choice of drug tier will make a huge difference to your monthly outgoings.

When choosing your insurer, make sure there are in-network ‘providers’, authorized prescribers and pharmacies, who are easily accessible, or alternatively that you can receive your medications by direct mail at the ‘in-network’ cost.

There are two further considerations.

1. Prior Authorization – Certain drugs require you or your doctor to obtain prior authorization from the insurer in order to be covered
2. Step Therapy – Before being covered for a new or expensive drug you must first try a lower-priced (lower tier) drug for the same indication.

What happens if the formulary changes?

If a ‘covered’ drug which you have been taking is removed from your insurer’s formulary you will be given written notice. As a Medicare beneficiary, you can expect a further 60 days supply, giving you time to find an alternative.

You can be sure that drugs will not be withdrawn unless there is a more effective replacement Silverscript formulary 2020 or the same outcome can be obtained more affordably.

Talk to our insurance agent to know more about Medicare Part D Formulary 2020