Finances: How to Save on Prescription Drugs

Q. I have a high-deductible health insurance plan and tend to rack up hefty prescription drug costs each year. Are there any good tools or resources to help me save on prescriptions?

A. Many employers and insurers are beefing up their online tools to provide personalized advice that can help you pay less for prescription drugs. You can look up the drug on your smartphone before you leave the doctor’s office and find out how much it will cost you (whether or not you’ve met your deductible). You can also see whether you can save money with generics or therapeutic alternatives, and whether you can get your meds at preferred pharmacies with lower prices.

You can also get manufacturers’ coupons for thousands of drugs at GoodRx’s website or via its smartphone app, which also alerts you to lower-cost alternatives, patient assistance programs and nearby pharmacies offering the lowest cash price. “You can save hundreds of dollars by doing some research,” says Thomas Goetz, chief of research at GoodRx. (Plus, your pharmacist can now provide information about whether a drug would cost less by paying cash than using your insurance.)

You can find out about drug manufacturers’ co-pay assistance programs and private foundations’ patient assistance programs at NeedyMeds.org. Some have income cut-offs but may offer help for families that earn up to 600 percent of the federal poverty level (about $100,000 for a couple or $150,600 for a family of four), says Shanna Barnes, of the Lash Group, which administers drug companies’ patient assistance programs. Find out about disease-specific programs at www.panfoundation.org.

Q. I’m thinking about renting out my house for a few weeks while I’m away on vacation this summer. What do I need to know about taxes?

A. If you rent out your house for 14 or fewer days per year but you live there the rest of the time, the rental income is tax-free (but you can’t deduct rental expenses). If you rent out your house for more than 14 days per year, you must report your rental income when you file your tax return. You can also deduct rental expenses, generally based on the portion of the year that you rented your home. For details, see IRS Publication 527 at www.irs.gov.

Q. My daughter may go to college in Europe next year. Can we use her 529 college-savings money tax-free outside of the U.S.?

A. Yes. You can use 529 money tax-free at any college that is eligible for federal financial aid, which includes more than 400 foreign institutions, says Mark Kantrowitz, of Savingforcollege.com. To look up eligible schools, go to www.savingforcollege.com/eligible_institutions.

Kimberly Lankford is a contributing editor to Kiplinger’s Personal Finance magazine. Send your questions and comments to moneypower@kiplinger.com. And for more on this and similar money topics, visit Kiplinger.com.

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