Medicare drug coverage (Part D)
Medicare drug coverage (Part D) helps pay for prescription drugs you need. You can obtain Part D coverage in two different ways. If you have Original Medicare Part A and/or Part B, you can enroll in a stand-alone prescription drug plan that works in conjunction with your original Medicare benefits. Or, if you have both Medicare Part A and Part B, you can enroll in a Medicare Advantage Plan (Part C) that includes prescription drug coverage.
According to federal law, everyone who is eligible for Part A and/or Part B is also eligible for a prescription drug plan. These are the two ways you can get coverage:
- Prescription Drug Plan (PDP): This is a separate, stand-alone insurance you can buy in addition to Part A and B or a Supplement (MediGap) insurance plan.
- Advantage Plans: You can combine Part A, Part B, and Part D coverage into one comprehensive plan. Many Advantage Plans include Part D, but some do not.
Medicare Part D
Medicare Part D is a prescription drug coverage plan sold by private health insurance companies. It can be a standalone addition to Original Medicare, or it can be included in a Medicare Advantage plan. You will have to pay a monthly premium to have a Part D policy, and the plan will require you to pay other out-of-pocket costs like deductibles, copays, and coinsurance. A Medicare Savings program or “Extra Help” can lower those costs if you meet eligibility requirements.
A Medicare prescription drug plan is a smart way to manage the cost of the medications you take now—and those you may need in the future. If you’re entitled to Part A and/or enrolled in Part B of Original Medicare, you’re eligible to join a Part D plan; however, when you enroll affects your effective date and premium. Our team of healthcare professionals can help you understand your eligibility and explain to you the Medicare Part D plans that are available.
Medicare drug coverage (Part D) helps pay for prescription drugs you need. You can obtain Part D coverage in two different ways. If you have Original Medicare Part A and/or Part B, you can enroll in a stand-alone prescription drug plan that works in conjunction with your original Medicare benefits. Or, if you have both Medicare Part A and Part B, you can enroll in a Medicare Advantage Plan (Part C) that includes prescription drug coverage.
According to federal law, everyone who is eligible for Part A and/or Part B is also eligible for a prescription drug plan. These are the two ways you can get coverage:
- Prescription Drug Plan (PDP): This is a separate, stand-alone insurance you can buy in addition to Part A and B or a Supplement (MediGap) insurance plan.
- Advantage Plans: You can combine Part A, Part B, and Part D coverage into one comprehensive plan. Many Advantage Plans include Part D, but some do not.
Medicare Part D
Medicare Part D is a prescription drug coverage plan sold by private health insurance companies. It can be a standalone addition to Original Medicare, or it can be included in a Medicare Advantage plan. You will have to pay a monthly premium to have a Part D policy, and the plan will require you to pay other out-of-pocket costs like deductibles, copays, and coinsurance. A Medicare Savings program or “Extra Help” can lower those costs if you meet eligibility requirements.
A Medicare prescription drug plan is a smart way to manage the cost of the medications you take now—and those you may need in the future. If you’re entitled to Part A and/or enrolled in Part B of Original Medicare, you’re eligible to join a Part D plan; however, when you enroll affects your effective date and premium. Our team of healthcare professionals can help you understand your eligibility and explain to you the Medicare Part D plans that are available.
Affordable Prescription Drug Coverage for Seniors
Prescription drug coverage for senior’s changes at 65. Why? Because at 65, seniors are finally eligible for Medicare. It’s something they’ve paid into for decades while working. However, prescription drug coverage is not part of Original Medicare. Getting the prescription drug coverage, you enjoyed while working will take a little more arranging.
Part D Plans in 2021
You’ll make these payments throughout the year in a Medicare drug plan:
- Premium
- Yearly deductible
- Copayments or coinsurance
- Costs in the coverage gap
- Costs if you get Extra Help
- Costs if you pay a late enrollment penalty
Your actual drug coverage costs will vary depending on:
- Your prescriptions and whether they’re on your plan’s list of covered drugs ( ).
- What “tier” the drug is in.
- Which drug benefit phase you’re in (like whether you’ve met your deductible, or if you’re in the catastrophic coverage phase).
- Which pharmacy you use (whether it offers preferred or standard cost sharing, is out of , or is mail order). Your out-of-pocket drug costs may be less at a preferred pharmacy because it has agreed with your plan to charge less.
- Whether you get paying your drug coverage costs.
Special Notes for 2021
Starting January 1, 2021, if you take insulin, you may be able to get Medicare drug coverage that offers savings on your insulin. You could pay no more than $35 for a 30-day supply. Find a plan that offers this savings on insulin in your state. You can join during Open Enrollment (October 15 – December 7, 2020).
Coverage Gap (Donut Hole) Costs
40% of costs for covered brand-name drugs and 51% of costs for covered generic drugs
This is the percentage you pay for covered prescription drugs after you reach the initial coverage limit amount of $4,130 and are in the Donut Hole, or Coverage Gap. When you are in the Coverage Gap, there is a temporary change in what you will pay for drugs. During the Coverage Gap, you pay 40% of the plan’s costs for covered brand name drugs and 51% for covered generic drugs. Most drug plans have a coverage gap.
Each year, the amount beneficiaries pay while in the donut hole will reduce by a small percentage until 2020, when the coverage gap is planned to be eliminated. In 2020, you will only be responsible for 25% of brand and generic drug costs. This is part of a new law enacted to eliminate the donut hole by 2020.
Out-of-Pocket Threshold (TrOOP): $6,550
Once you’re spending on prescription drugs (including manufacturer discounts) reaches this amount, you are out of the Donut Hole and reach Catastrophic Level Coverage. During this phase, you will pay the greater of 5% or $3.70 for covered generic drugs. You’ll also pay the greater of 5% or $9.20 for all other covered drugs until the end of the calendar year.
How to Switch Plans Each Year
If you’re not happy with the changes made to your Medicare Part D plan this year, you can switch prescription drug plans. In most cases, the only time you can switch your Part D plan is during Open Enrollment, from October 15 to December 7. Your new plan will become effective January 1th of the following year.
If you have prescription drug coverage through an Advantage Plan, you may also be able to switch from an Advantage Plan to Original Medicare during the Medicare Advantage Disenrollment Period (MADP). This period occurs from January 1 to February 14 every year. You can join a prescription drug plan when you switch to Part A and Part B during the MADP. If you make changes during the MADP, they will become effective the first day of the next month.
There are additional times that you may be able to change prescription drug plans, called Special Enrollment Periods (SEPs).
Extra Help with Medicare Prescription Drug Plan Costs
What help can I receive?
Medicare beneficiaries can qualify for Extra Help with their Medicare prescription drug plan costs. The Extra Help is estimated to be worth about $5,000 per year. To qualify for the Extra Help, a person must be receiving Medicare, have limited resources and income, and reside in one of the 50 States or the District of Columbia. Visit our information page on Extra Help qualifications.
You can find out if you qualify to make changes during a SEP by asking one of our License and Certified Insurance Adviser’s.
Part D Premiums by Income
