Medicare Part D
Leverage on our Expertise to Pick Extremely Beneficial Drug Coverage through Medicare Part D
Medicare Part D Insurance Plans
Medicare Part D prescription drug coverage referred as Part D is provided and coordinated by Medicare approved private insurance companies. Any beneficiary eligible for Original Medicare Part A and Part B and who permanently resides in the service area of a Medicare Prescription Drug Plan, can sign-up for Medicare Part D. Medicare Part D is optional but if you don’t enroll in Part D when you become eligible, then you might need to pay a late enrollment penalty. Medicare Part D is an optional benefit for Medicare beneficiaries and to avail Medicare drug coverage, you need to join a Medicare plan that provides prescription drug coverage. The cost and the covered drugs vary with each Part D plan.
Around 45 million people with Medicare are currently enrolled in plans that offer Part D drug benefit. Unlike Original Medicare, Part D is only provided through private insurance companies, which have contracts with the federal government. Thus, if you wish to get Part D coverage then you have to choose and enroll in a private Medicare prescription drug plan or a Medicare Advantage Plan with drug coverage. Though enrollment for this plan is optional but still you should enroll in the plan to avoid incurring future penalties. Enrollment for this plan is only allowed during approved enrollment periods and ideally you should sign up for the Part D plan when you first become eligible for this plan.
Medicare Part D Coverage Options
Medicare prescription drug coverage is available in two ways:
- If you have original medicare then Part D is not automatically included, instead you need to enroll in a stand-alone prescription drug plan that works alongside your original Medicare benefits.
- If you have Medicare Part C, then you get prescription drug benefits by enrolling in a Medicare Part C plan that includes prescription drug coverage. Such plans are known as Medicare Advantage Prescription Drug Plans, which give you the option to get health and prescription drug benefits covered under a single plan.
Part D Coverage
Every Medicare Part D plan that covers prescription drugs has its own list of covered drugs including some specific generic and brand name prescription drugs. All Part D plans cover certain categories of medications and the drugs covered in each category vary with diverse plans of different insurance companies. Due to this it is always a good idea to check the Part D plans or Medicare Advantage Prescription Drug plan to ensure that your medications are covered. The drugs covered can change anytime and you will be informed about the change by your insurance company. However, all Part D plan must cover at least two prescription drugs in each drug category and most of the medications from the anti-psychotics, anti-depressants, immunosuppressants, anti-convulsant, antineoplastic (cancer), and anti-retroviral (HIV/AIDS) categories.
You should keep in mind that if you need a drug that is not included in your plan list then you will need to pay the full retail cost of the drug. However, if your Part D plan doesn’t cover a drug that you or your doctor think is essential for you then you have a right to ask for an exception to get the medication covered. You just need to submit an exception request to your insurance company either through phone or in writing and the company needs to respond with its decision within 72 hours and if you submit an expedited request then within 24 hours.
Medicare Part D Enrollment Period
If you are first time enrolling for the Medicare Part D, then you should enroll during your Initial Enrollment Period which is usually the same as your Medicare Initial Enrollment Period that is the seven month period. However, if you miss the Initial Enrollment Period, then you can enroll in the Fall Open Enrollment Period or if you qualify then during the Special Enrollment Period.
Whether you should sign up for a Medicare Part D plan depends on your circumstances. You may have creditable drug coverage from employer or retiree insurance. If so, you don’t need to enroll in a PDP until you lose this coverage. Also, some people already enrolled in certain low-income assistance programs may be automatically enrolled in a Medicare drug plan and receive additional financial assistance paying for their medicines.
How Much Does Medicare Part D Cost
The average Medicare Part D nationwide monthly premium for 2019 is $33.19, though the plan cost varies depending on the plan you choose depending upon the drug you need and the area where you live. Along with the monthly premium, Medicare Part D costs may also include yearly deductible, coinsurance, coverage gap costs, extra help cost and if you enrolled late then a late enrollment penalty. The Medicare Part D plan costs also depend upon:
- Drugs you use
- The plan you choose
- Whether you select a pharmacy that is included in your plan’s network or not
- Whether the drugs you use are included in the list of drugs approved by the plan or not
- If you get Extra Help for paying Part D costs
Eligibility for Medicare Part D
If you have Medicare Part A and Part B coverage and you do not have drug coverage then you should enroll in Medicare Part D plan because if you delay enrollment in Part D for some time and if you need drug coverage later then you will incur a premium penalty. However if you are enrolled in Medicaid, a state run program that covers medical expenses for people with low or limited income, and become eligible for the Medicare drug benefit then you will be automatically enrolled in Medicare Part D plan and pay no premium for it.
How Medicare Part D Work?
Medicare Part D is an insurance plan that covers your medication needs, for which you need to pay a monthly premium to an insurance carrier. With Medicare Part D you are able to use the insurance carrier’s network of pharmacies to purchase your prescription medications by just paying a copay or percentage of the drug’s cost, as the rest of the amount will be paid by the insurance company. The four stages of Medicare Part D plan are as follows:
Yearly Deductible – It is the amount that you need to pay out of pocket before your insurance carrier starts providing you coverage. The highest deductible a Part D plan can charge in 2019 is $415. Some of the Part D plans come with $0 deductible and hence will pay for your prescriptions right away. Some of the Part D plans come with a deductible amount like $150 or $250 in which your insurance carrier will not pay for your prescription until you pay the deductible amount out-of-pocket. A maximum deductible is set by the government for Medicare plans that cover prescription drugs and this might change every year.
Coinsurance and Copayments – These are the amounts that you need to pay for your medications after paying the deductible amount. A copayment is a fixed amount which you need to pay for your prescription. For example you might have to pay $5 for a generic drug, $25 for a preferred brand name drug and $40 for a non-preferred brand name drug. Coinsurance is a certain percentage of the price of your prescription and usually plans have coinsurance for expensive drugs that are listed in tier 4 and tier 5.
Coverage Gap – Most Medicare drug plans have a coverage gap in which there is a temporary limit on plan drugs coverage. Coverage gap is the point in your Part D coverage when most of the Part D plans stop paying for your drugs. In the year 2019 the coverage gap discount is 37% on generics and 75% on brand name drugs and your coverage gap starts when your total drug costs, the amount which you and your plan pay, reaches $3,820. There are only a small number of Part D plans that pay for your generic or brand name drugs during the coverage gap.
Catastrophic Coverage – In Medicare Part D plans you and your insurance carrier share the cost of drugs. The money which you spend on your prescription is called your out-of-pocket costs and it determines when the catastrophic coverage begins. In the year 2019, if your total drug costs are more than $7,654 then all the Part D plans will cover at least 95% of your drug costs for the rest of that year.
Drug utilization rules that affect your Part D coverage
Private health insurance companies that provide Part D coverage have to comply with certain drug utilization rules of Medicare to ensure safety and also cost containment. Some of the common drug utilization rules include:
Quantity Limits – There is a restriction on the quantity of medication you can purchase at a time or upon each refill. If your are prescribed more drugs than the quantity limit by the doctor then an exception form will be required stating the reason behind the need of more drugs.
Prior Authorization – Every individual or their doctor needs to have plan approval before a pharmacy dispense their medication. This is basically done because the insurance company may wish to ensure that the prescription is medically necessary for the individual. Besides, in case of expensive medications, the insurance company may ask doctor that why specific medication is necessary for the individual and any alternative medication might be ineffective or harmful.
Step Therapy – As per Medicare drug utilization rules, you are required to try less expensive alternative medications to treat your condition before considering you to cover for the prescribed medications. In case if the alternative medication works then both you and the insurance company will save money and if it doesn’t work then your doctor will need to explain that why you need expensive medication when less expensive drugs are available and the doctor will need to show that less expensive drugs were not effective.
Key Facts Related to Medicare Part D
- Anyone having Medicare Part A or Part B or both the plans cannot be denied Medicare Part D coverage on the basis of their health or income.
- Though it is not compulsory to enroll in Medicare Part D but if you don’t sign up on becoming eligible and sign up late then you have to bear consequences like delayed coverage and permanent late penalties.
- To obtain Part D coverage you must select from the approved private drug plan among the different plans offered by several private insurance companies.
- It is always wise to have Medicare Part D coverage despite of having better drug coverage already.
- If the costs of your drugs are very high then you will require to pay only 5% of the cost of your each prescription after paying a certain amount of money out-of-pocket in any one year.
- Anyone having limited income if qualify for a part of the program called extra help then they will pay little amount for their medications.