Loophole in Obamacare exploited – Pharmaceuticals- Coventry Health

Okay there is going to be some ambiguity and some math here so stick with me.


I process pharmaceutical claims everyday. I had some beginning of the year Med D claims that were $300-$500 higher than our calculator expected.

These are the main drugs for a specific diagnosis. The total drug cost is about $6,500-$6,800 per month (per shipment). We expect $2,300-$2,500 initial payments given the deductible, initial percentage, and going into the donut hole.

A brief explanation of Med D copays
There is typically a $325 deductible then an initial phase (usually 20 25 or 33%) THEN the donut hole hits. Drug price takes you into the donut hole – you pay to get out of it.
For 2013 -----Initial phase goes to $2,970 then the individual pays 100% (less Obamacare discounts) until the individual and Medicare pay $4,750 out of pocket. In 2012 (Obamacare) there was a 50% discount in the donut hole – paid by Medicare. In 2013 there is a 52.5% discount – the donut hole is going away.

So these claims are a bit too high. I do an analysis of 35 claims (out of 1,500 on the invoice) and communicate this to my boss and to the pharmacy. You have heard of this pharmacy.

I was certain that the billing program at the pharmacy has switched the 52.5% the wrong way and applied the 47.5% to the patients.

What I found out was telling.

The Pharmacy representative (great lady who really solves a lot of problems FOR patients everyday) informed me that almost all of the claims were run through Coventry Health. They re-classified two mainstay drugs for a specific and kind of rare diagnosis as “Non-Preferred” drugs. Totally ridiculous. These are THE drugs for this diagnosis. Because of the re-class by Coventry it is not the donut hole that is effected it is the initial phase that changes. Instead of 20/25/33% it jumps up to 50%......in some states – Illinois is 50%, Virginia and Ohio is 44% etc. I checked the Coventry website and randomly selected a few states and they were all over 40%.

I was stomping mad. My boss finally said to pay the claims for the patients – we weren’t going to get Coventry to change this policy. The rep at the pharmacy intimated that she knew it was bullshit.


I found out the next day that many patients are calling in trying to find something other than Coventry to cover them.