Medicare Part D provides insurance coverage for your prescription drugs under Medicare. It covers many brand name and generic prescription drugs to ensure individuals receive the medications they need and is similar to other types of prescription drug coverage. This coverage also provides protection for people who may have very high drug costs or unexpected prescription drug bills in the future. We have provided some frequently asked questions to help those who are currently enrolled in a Medicare Part D Plan or who are considering enrolling for the first time.
What Types of Prescription Drug Coverage are Available Under Medicare Part D?
There are two options for prescription drug coverage through private insurance companies approved by Medicare:
- Prescription Drug Plan (PDP) is a fee-for-service option and provides prescription drug coverage when you have traditional Medicare Part A and/or Part B
- Medicare Advantage or Medicare Health Plan (MA-PD) is comparable to a managed care plan. These plans provide similar services to what you would receive under Medicare Part A and B, including your prescription
drug coverage. If you are enrolled in one of these plans, it covers your Medicare services, and they would no longer be paid under traditional Medicare.
What if I Currently Have Prescription Drug Coverage Through My Retirement Plan, Military or Other Insurance?
When you became eligible for Medicare, you should have received a letter from your insurance company explaining whether your coverage is at least as good as or better than Medicare Part D, known as “creditable coverage.” These insurers are also required to send you a notification by October of each year letting you know if you still have credible coverage.
It is important to read the information carefully so that you understand your choices and can make an informed decision on what coverage will best meet your needs. This may also include any impact to a spouse or family member
who is covered under your current insurance. It is also recommended that you keep any letters or correspondence should there be any questions about your coverage in the future.
What Does Medicare Part D Cost?
You typically pay a monthly premium as well as an initial deductible for the first part of coverage, and then you and your insurance company each share a portion of the costs. Your out-of-pocket costs “start over” at the beginning
of each calendar year and your Part D plan keeps track of what you have paid. These costs are combined and tracked throughout the year for the covered medications provided by all pharmacies you may use. There is a standard benefit for Medicare Part D which may vary depending on the Part D plan, including premiums and deductibles. For 2020, potential costs are:
What is the Coverage Gap/Donut Hole?
The Medicare Part D ‘coverage gap’ is a temporary limit on coverage for prescription brand name and generic medications based on what is spent by both you and the Part D plan for the year.
In 2020, the coverage gap occurs after you and your plan have spent $4,020 on covered drugs (the combined amount plus your deductible).
You move out of the coverage gap once you have spent $6,350 out of pocket in 2020. You then receive ‘catastrophic coverage.’ Under ‘catastrophic coverage,’ you only pay a small co-payment for covered drugs for the remainder of the year.
What you pay for generic drugs during the coverage gap has decreased each year. In 2020, you will only be responsible for 25% of the cost of medications in the coverage gap.
Is Financial Help Available for Medicare Part D?
If you have limited income and assets, such as savings accounts and stocks, you may qualify for Extra Help from Medicare to pay for the costs of Medicare Part D prescription drug coverage. This may include all or a portion of the drug plan’s monthly premium, deductibles and other costs you would normally pay. Extra Help is valued at $4,000 per year for those who qualify.
To determine if you qualify for Extra Help, you must apply. Applications are available from the Social Security
Administration on-line at www.ssa.gov or by calling 1-800-772-1213. Anyone from SSA may assist you in completing the application and you may apply at any time.
How Do I Know Which Prescription Drugs are Covered?
The list of prescription drugs covered by the Medicare Part D plans (or the Plan Formulary) can vary from plan to plan. While all categories of prescription drugs will be covered, the Part D plan may require additional information from your physician explaining why you need a certain medication. Your pharmacy should also be able to provide you with a list of the medications you are currently receiving. This information can be used to compare what is covered on the formularies for each plan. Additionally, you can obtain a list of the specific drugs a plan covers by contacting the plan directly or visiting the plan’s website.
How Do I Enroll in a Part D Plan?
You can enroll in a Medicare prescription drug plan or Medicare Health Plan:
- When you first become eligible for Medicare (3 months before you turn 65 and up until 3 months after you turn 65)
- From October 15 to December 7 each year. If you are already in a Part D plan and want to remain in the same plan for 2020, you do not need to complete a new application.
You must complete an enrollment application for that plan. Applications are available on the plan’s website, through www.Medicare.gov, or by calling the plan directly. Customer service representatives are also available at Medicare to assist you with the enrollment process by calling 1-800-MEDICARE (1-800-633-4227) TTY: 1-877-486-2048. Support is offered in over 250 languages and available 24 hours a day, 7 days a week except for Thanksgiving and Christmas.
What is the Difference Between a Preferred Pharmacy and a Standard Network Pharmacy?
Medicare Part D plans can have multiple types of pharmacies within their network. Each type of pharmacy may have different cost-sharing and different types of support services. Preferred pharmacy networks are primarily retail and mail order pharmacies. Long term care pharmacies, like Remedi SeniorCare, are considered to be standard network pharmacies, but can also include retail and mail order. When evaluating different plans, it is important to understand the services provided by the pharmacy as well as the estimated costs to ensure the individual’s medication needs will be met
Are There Resources Available to Help Me With Enrollment or Answer Other Questions I May Have?
There are a number of resources available:
- Part D Plans – contact any of the plans directly by going to their website or calling their toll free number
- “Medicare and You” Handbook which you receive in the mail or electronically each year
- Websites and organizations which provide a variety of information on Medicare Part D:
- MyMedicare.gov to access your specific plan and benefits information if you are already enrolled or would like to enroll in a Part D plan. This site may also be used to evaluate if there are other plans that may provide better coverage and/or cost savings for you.
- www.shiptacenter.org is the State Health Insurance Assistance Program website which identifies organizations who provide trained counselors for free one-on-one personalized assistance with determining your best plan options as well as helping you to complete an enrollment application
- www.benefitscheckup.org provides additional resources for financial assistance with your prescription drug costs
- Medicare Rights Center (www.medicarerights.org) is a national non-profit consumer rights organization that offers many resources and programs to assist with understanding coverage. Representatives are available by phone, 1-800-333-4114 (Monday-Friday).
This document is intended to provide educational information of interest to Medicare beneficiaries and does not make any recommendations regarding individual beneficiary enrollment or plan selection. For more information contact your plan directly or Medicare at 1-800-MEDICARE. You may also find valuable information on the Medicare website at www.medicare.gov.