Medicare Part D

After reading about Medicare plans A, B and C, you might still be wondering where prescription drug coverage comes in, or how can you insure coverage for your medications. You’ll find the answer in this next Medicare plan, or the final plan offered through Medicare, called Part D.

What is Part D (Medicare Prescription Drug Coverage)?

Part D is prescription drug coverage insurance that is provided by private companies approved by Medicare. You may need to enroll when you first become eligible to keep from paying a late enrollment penalty later.

Part D was designed to help people with Medicare by lowering their prescription drug costs and to protect against future costs. A prescription drug plan may also enable you to have greater access to medically necessary drugs.

 

How Can You Get Part D Coverage?

There are two ways to join the Medicare prescription drug coverage plan. The first is by adding it to your Original Medicare Plan or some Medicare cost plans, private fee-for-service plans, and Medical savings account plans. The second way is to join an HMO or PPO plan that includes Part D coverage. You may have to pay a monthly premium that will vary according to the plan you choose.

Adding Part D to the Original Medicare Plan

If you are in the Original Medicare Plan, you may add Part D coverage. Generally, you will pay a separate premium and in some cases a deductible.

Adding Part D to the Medicare Advantage Plan

If you are in the Medicare Advantage Plan, then chances are you already have Part D coverage. However, some plans offer Medicare Advantage without drug coverage. In most cases, you cannot mix and match a Medicare Advantage plan with a separate Part D drug plan.

How Part D Works

After you join, you will receive a membership card and materials via the mail. Under most plans you will pay a copay or coinsurance. Some plans will also have a yearly deductible to meet before benefits begin.

Most Part D plans have a “coverage gap” (also referred to as a donut hole). This usually means that the amount you pay and what the plan pays will change after certain amounts have been reached. This benchmark amount is set by Medicare each year and is a total of what you pay and what the plan pays. Generally, copay amounts are replaced by discounted amounts for generic and name brand drugs.

Catastrophic coverage begins once you have met certain out of pocket amounts, also established by Medicare annually. Once qualified, you only pay a small copay or coinsurance for covered drugs the rest of the calendar year.

What is the Late Enrollment Penalty?

This is an amount added to your Part D premium if you choose not to participate in a Part D plan when eligible. You may owe a late enrollment penalty if at any time you after your initial enrollment period is over, there is a period of 63 or more days in a row when you don’t have Part D or another creditable prescriptions drug plan such as an employer plan or VA coverage.

Extra Help with Medicare Prescription Drug Costs

If you can’t afford Part D costs, you may qualify for additional help. Several programs are available to assist with covering additional costs such as low-income subsidy (LIS) or Medicaid if you meet the income and resource requirements.

If you qualify for Extra Help and join a Medicare drug plan, you’ll:

  • Get help paying your Medicare drug plan’s monthly premium, yearly deductible, coinsurance and copayments
  • Have no coverage gap
  • Have no late enrollment penalty

You automatically qualify for Extra Help if you have Medicare and meet any of these conditions:

  • Full Medicaid coverage
  • Get supplemental Security Income (SSI) benefits.