Medicare Part D Plans
All beneficiaries with Original Medicare have the option to purchase additional drug coverage. Please note that even though you may have been automatically enrolled in Original Medicare, (Part A & Part B) you’re not automatically enrolled in a Medicare Part D prescription drug plan.
This program doesn’t enforce any income limits. The number of providers varies from one state to the next. Most Americans have more than a dozen plans to choose from. Some insurers serve the entire country, while others only accept customers in specific states.
To avoid extra costs, it’s important to enroll as soon as your eligible during your Initial Enrollment Period (IEP) for Part D. Your IEP takes place during the first 3 months prior to your turning 65, your birth month, and 3 months after you turn 65. You can also enroll during the Annual Election Period (AEP) which takes place between October 15th & December 7th. More about Medicare Part D Open Enrollment dates is available here.
Federal law requires insurance companies to accept any eligible person who requests coverage. An insurer can’t reject your application because you currently take medications or have a serious health condition.
What is the Part D Penalty?
You might face an extra monthly fee if you wait until after the IEP to enroll. This penalty discourages people from waiting until they need medications before enrolling. The penalty is added to your monthly premium.
The cost is determined on how long you went without creditable prescription drug coverage. It’s calculated by multiplying 1% of the national base beneficiary premium.
Is Medicare Part D Subsidized?
All Medicare Part D plans are subsidized by the U.S. government. However, some seniors can qualify for a larger subsidy. They include people who must take particularly expensive medications. These individuals receive further assistance regardless of how much income they have.
Additionally, anyone with a relatively small income can acquire a more generous subsidy. This feature of the Part D program is known as Extra Help. It assists low income beneficiaries with their prescription drug costs so that they don’t enter the coverage gap.
Used in Conjunction with Original Medicare
Medicare beneficiaries often use Medicare Part D plans in conjunction with the Original Medicare Part A coverage and B plans. Some people combine them with Medicare savings accounts or fee-for-service programs.
A number of retirees choose to enroll in Medicare Advantage plans that include drug coverage; these individuals don’t need Part D. In fact, you’ll automatically lose membership in a Medicare Advantage plan with drug coverage if you sign up for a separate prescription plan.
Preferred Pharmacy Network for Medicare Part D
Each plan has different rules about the pharmacies that you can use. All plans pay for medicines from traditional drug stores, and mail-order suppliers are covered by some insurers. You might only be able to use specific pharmacies on a list.
It’s important to choose a plan that allows you to purchase medications at a nearby drug store. Otherwise, you may need to travel long distances after being diagnosed with a medical condition.
Premiums vary depending on the specific plan that you select. Most of an insurer’s customers pay the same price, but an extra charge will apply if you have a high level of income. This type of fee is also added to the cost of Medicare Part B.
The government assists people who need help paying for Part D coverage. Depending on where you live, greater assistance may be available from state or federal agencies. You must meet income and asset requirements to qualify.
Every insurer maintains a unique list of drugs that it covers. Insurance companies often classify Medicare drug costs into multiple tiers. High-tier drugs typically have bigger co-pays. However, insurers make exceptions from time to time.
A company might pay for a larger portion of a drug’s cost if a doctor convinces them that less expensive medications couldn’t successfully treat your condition.
Physicians, pharmacists and patients must follow various rules to maximize coverage. For instance, a Part D plan may limit you to purchasing a certain number of pills in each transaction. Insurers often require doctors to request permission before prescribing certain high-cost medicines.
A physician might be expected to prove that a drug is truly needed. Alternately, the insurance company could require you to try a less expensive drug before taking a more costly medication.
Every plan sets its own deductible. You won’t receive any coverage until you’ve spent this much money on covered prescription drugs in one year. The government caps deductibles at a certain amount; this limit changes from time to time. Insurers also charge co-pays. These costs differ tremendously depending on the plan that you choose.
The costs and features of a prescription drug plan aren’t set in stone. They have the potential to change on a yearly basis. Insurers may adjust their rates and decide to drop or start covering specific medications.
However, these companies must tell you about upcoming policy updates. A document called the “Annual Notice of Change” reveals any new policies that will take effect in January. This gives you an opportunity to switch plans if desired. Click here to learn more about Medicare Part D changes in 2018.
To sum it up, the answer to “What is Medicare Part D?” is that it’s a subsidized insurance program that pays for some or all of your prescription drug costs. All Medicare users may benefit from it regardless of income level or health status.
If you need help enrolling or choosing a suitable plan, please contact our knowledgeable advisers today or fill out our compare rates form now!