What is Medicare Part D?

What is Medicare Part D?

With so many plans under Medicare, it can get a little confusing to know what each plan is about. The best way to learn about the different plans under Medicare is to go straight to the source! The online government website at Medicare.gov has all the information you need to discover all the details about each plan.

Medicare Part D is an optional benefit for prescription drugs that is available to anyone who already has Medicare Part A or Medicare Part B coverage. Medicare Part D is available through insurance and private companies that offer approved Medicare coverage.

What is a formulary? How are formularies charged?

A formulary is the specific set of drugs that are included in the tier plan. Each insurance company that offers Medicare Part D has a variety of tiers that you can select to meet your exact needs. If you have many drug prescriptions getting a “tiered” plan (called a formulary) that meets most or all of your prescription will help lower your out of pocket costs.

Which prescription drugs are not covered?

Only the prescription drugs that are included in your tier are covered; however, your doctor may be able to file an exception on a specific higher cost drug if he or she believes that specific drug is more beneficial than the one currently listed on your plan.

How much does Medicare Part D cost?

Medicare Part D is charged via monthly premiums, deductibles, co-payments/co-insurance, and coverage gap.

  • In 2013, costs for coverage ranged from $0 to $59 for monthly coverage depending on your income and the type of coverage that you select.
  • Many insurance companies offer deductibles of up to $310 while some companies also offer a “no-deductible” plan.
  • Once the deductible is paid, Medicare Part D kicks in to pay for most or all of the drugs under your selected plan.
  • The balance of the drugs that are not covered are paid by the private individual via a co-payment or co-insurance depending on the plan that you select and what is covered.
  • Coverage gap must be paid once your total drug cost allowances for the year have been used up.
  • How do I select a Medicare Part D Plan?

    The best way to select a Medicare Part D plan that fits your needs is to create a list of all of the current prescription drugs that you are taking. Next, determine with your doctor if you must use only branded drugs or if generics are also acceptable. Select the plan that has all or most of your drugs covered. If you have trouble selecting between two or more plans, select the plan that significantly reduces the costs of your most expensive drug prescriptions. Take note of the co-payments for each of the drugs you are taking and add this into your selection process as this may impact the total out-of-pocket costs that you will pay. Lastly, determine which pharmacy is best suited for your plan and which location is easiest for you to get to.

    Some people may be eligible for additional financial assistance based on their income, this type of assistance is called Extra Help. If you know you will be needing help with drug coverage, go ahead and apply once you are enrolled in Medicare Part A or B.

    Ask your doctor for recommendations on insurance companies and plans that they have worked with in the past. Selecting a Medicare Part D Plan that works for your needs can help offset the costs associated with the prescription drugs that you need.

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