Prescription Drug Plans
Medicare Part D
What is Medicare Part D?
Medicare Part D is a federal program designed to help cover the cost of prescription drugs for seniors. It's an optional plan designed specifically for prescription medications offered to individuals who are eligible for Medicare, and it works with the following Medicare plans:
Original Medicare Part A (hospital)
Original Medicare Part B (medical)
Medicare Part C (Medicare Advantage)
What to Consider When Choosing
Selecting the right Part D plan involves several key considerations:
Costs: Assess the costs associated with each plan, including premiums, deductibles, coinsurance, and coverage gap.
Coverage of Medications: Review each plan's list of covered drugs, known as the formulary. Formularies are organized into tiers that dictate how much you pay. Ensure that your current medications are covered and check for any restrictions, such as prior authorization.
Pharmacy Network: Verify that your preferred pharmacies are included in the plan’s network. Additionally, some plans offer better savings if you use certain pharmacies.
Creditable Coverage & Penalties
Some employer plans offer coverage that’s as good as or better than Medicare Part D. This is called “creditable coverage.” If you have creditable coverage and maintain it, you won’t face a late enrollment penalty if you later decide to enroll in Part D. However, if your employer coverage ends or you retire, you’ll need to enroll in a Part D plan to avoid any gaps in coverage.
You may face a late enrollment penalty if you do not enroll in a Part D plan when first eligible and do not have other creditable coverage. This penalty is calculated based on how long you went without coverage and is added to your premium once you enroll in coverage. It’s important to enroll when first eligible to avoid this additional cost.
When & How to Enroll
Annual Enrollment Period (AEP): Every year from October 15th to December 7th, you can make changes to your Medicare prescription drug plan. This period is crucial for reviewing and adjusting your coverage based on your current medication needs.
Initial Enrollment Period (IEP): This is the seven-month window around your 65th birthday when you first become eligible for Medicare. It starts three months before your 65th birthday, includes your birthday month, and extends three months after.
Open Enrollment Period for Medicare Advantage Plans (OEP): If you're enrolled in a Medicare Advantage plan, you can switch to a different plan or return to Original Medicare, with the opportunity to join a standalone Part D plan from January 1st to March 31st each year.
Special Enrollment Periods (SEPs): Certain life events, such as moving to a new state or losing creditable drug coverage, may qualify you for a Special Enrollment Period.
