Leah Sugar Kari, Licensed Insurance Agent and Broker Specializing in Medicare Health Insurance Plans

Part D Prescription Drug Plans

Medicare offers prescription drug coverage to everyone with Medicare. If you decide not to get Medicare drug coverage when you're first eligible, you'll likely pay a late enrollment penalty unless one of these applies:

To get Medicare drug coverage, you must join a plan offered by an insurance company or other private company approved by Medicare. Each plan can vary in cost and drugs covered.

You should sign up for Part D Prescription Drug Plans, which helps cover prescription drug costs, along with other components of Medicare starting three months before your 65th birthday.

It's important to do this on time because there's a permanent premium late penalty for enrolling more than three months after your 65th birthday if you don't have creditable drug coverage from another source, such as a retiree plan.

More about when to enroll

If you are already enrolled in a Part D "stand alone" prescription drug plan or a Medicare Advantage plan that incorporates drug coverage, you can switch plans during the annual enrollment period, which runs from Oct. 15 to Dec. 7 every year.

Making Part D work

Part D Prescription Drug Plans, either those incorporated into Medicare Advantage Plans (MAPD) or stand alone prescription drug plans have four distinct stages for coverage.

The Deductible Stage:

If your plan has a deductible cost, you'll pay all of your prescription medication costs until you've reached your plan's deductible.  Once that amount is reached, the plan will pay it's share of your drug costs.

Your plan may not have a deductible stage.  If so, your plan will pay it's share along with your copay or coinsurance for your drugs.

The Initial Coverage Stage:

This is your share of cost, combined with your prescription drug plan's share of cost for covered drugs.  You are in the initial coverage stage until your share and the plan's share reach $3820.00 

The Coverage Gap Stage: 

Prescription Drug Plans have a coverage gap called a "donut hole." This means there's a temporary limit on what the drug plan will cover for drugs.  The 2019 coverage gap begins after you and your drug plan have spent $3820 for covered drugs. People with Medicare who get Extra Help, or a low income subsidy, to assist with paying Part D costs won’t enter the coverage gap.

In the coverage gap or donut hole,you'll pay 25% of the plan's cost for covered brand-name prescription drugs, and 37% of the cost of a generic drug.  You receive these savings if you buy your prescriptions at a pharmacy or order them through the mail. The discount will come off of the price that your plans have set with the pharmacy for that specific drug. Your plan will pay the remainder.

While you'll pay 25% of the price for the brand-name drug in 2019, your share and the plan's share of the price together will count as out-of-pocket costs which will help you get out of the coverage gap.  It's different with generic drugs:  your share of cost, 37%, alone goes toward your reaching the coverage gap's end at $5100.

The Catastrophic Stage:

Once out of the coverage gap, having reached the $5100 that you and the plan have paid for covered drugs, you are in the Catastrophic stage.  You'll pay a significantly reduced cost for your drugs of $8.50 for brand name or $3.40 for generic, or 5% of the prescription drug's cost, whichever amount is greater.

Choosing a plan

It pays to review your Part D coverage every year, especially if you have started taking new drugs.  Formularies, or lists of drugs each prescription drug plan submits to Medicare for approval, change yearly.  Your plan may cover a drug at a different tier level, or cost, than your current plan.  

Let's talk about what your needs are and what is most important to you. We'll explore plans that will provide Medicare solutions to meet those needs. 

Getting financial help

Individuals with annual incomes of less than $18,735 and financial resources of less than $14,390, or married couples with incomes of less than $25,365 and resources of less than $28720 might qualify for Extra Help from Medicare to pay their Part D premiums and out-of-pocket drug costs.

Download Medicare's instructions on applying for the Extra Help program. and Six Ways to Lower Your Drug Costs  on Medicare.gov.

By contacting the phone number on this website you will be directed to a licensed insurance agent.

Source: www.medicare.gov