Insuring Your Health

Obamacare Drug Coverage Descriptions May Confuse Consumers About Costs, Study Finds

Square peg, round hole. More than a third of silver plans offered on the federal health insurance marketplace may be listing inaccurate or incomplete prescription drug cost-sharing information because their formularies don’t fit neatly into the federal government’s online template, a recent analysis found.

Healthcare.gov is the online gateway for consumers in 37 states to compare the health plans available to them on the individual market.

The website’s prescription drug formulary information is divided into four tiers: generics, preferred brands, non-preferred brands and specialty drugs. The analysis by Avalere Health, a research and consulting organization, found that 35 percent of silver-level plans offered this year on the federally facilitated exchange don’t follow this model.

Business Management ChallengesMany plans have five or six drug tiers, says Dan Mendelson, CEO at Avalere. Seventeen percent, for example, use multiple specialty drug tiers, and many plans split generic drugs into two categories rather than one, he says.

“The plans are doing the best they can with the fields they have to convey the information,” he says.

Why does it matter? In their efforts to force fit their plans into the federal government’s information grid, consumers aren’t necessarily getting the complete information they need to accurately predict their out-of-pocket costs. This can be especially problematic for plans with multiple specialty tiers, where cost sharing may increase significantly for drugs in the highest tiers.

Administration officials had no response Thursday.

If consumers click through from the healthcare.gov website to the benefits and coverage summary that every insurer has to provide for each plan, drug coverage details will generally be more clearly spelled out.

It’s an evolution, says Mendelson. “The system this year is worlds better than the system last year, and next year it needs to be better than this year.”

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