Understanding Medicare Part D Coverage and Enrollment Options

One of the biggest issues facing seniors on Medicare is choosing which drug coverage option they should go with.

The decision comes down to personal preferences and the drug regimens a Medicare beneficiary is on.

There are two choices for additional coverage:

• Through a Medicare Advantage (Part C) plan, which covers health care as well as pharmaceuticals, or
• A Part D plan, which only covers prescription drugs and is used separately from Original Medicare.

If you have Original Medicare, you will typically enroll in a stand-alone Part D plan to receive drug benefits. More than 70% of people enrolled in Medicare are also enrolled in Medicare Part D.

Be warned, though. If you have a Medicare Advantage plan, you do not need Part D coverage. If a person is enrolled in a Medicare Advantage plan or Part C and enrolls in Part D, they will be removed from Part C coverage and returned to Original Medicare.

What Part D covers

Every prescription drug plan from Medicare has a list of covered drugs.

Prescription drugs are placed in separate tiers based on their prices. Low-tier drugs usually cost less than those in higher tiers.

There may be instances where a doctor insists that a patient use a high-tier drug instead of a low-tier alternative. If this is the case, it may be possible to ask for an exception and have a lower copay obligation.

Formularies (drug lists) may change each year based on Medicare’s guidelines. When changes involve a currently used drug, the plan must provide written notice of the change 60 days before the change takes place. Notification may be made by direct contact or when a patient requests a refill of the affected drug.

Part D cost and enrollment

Part D includes an annual deductible that beneficiaries must meet before coverage kicks in.

In addition to this, policyholders pay a premium and any coinsurance costs.

There may also be costs for extra help, late enrollment and coverage gaps. Drug plans vary in price depending on the plan, whether the patient uses in-network pharmacies, the drugs used, and more.

While plan participants do not have to enroll in Medicare again every year, there are certain time frames when initial enrollment and changes are permitted.

Beneficiaries can shop around to save money. Some plans will offer low or no copays for certain drugs on their formularies. These drugs are usually in the lower tiers of a tiered formulary. For example, you may pay nothing out of pocket when filling prescriptions for generic drugs that are commonly in tier 1 or tier 2 of a tiered formulary.

Part D with other coverage

Some people have existing plans with companies other than Medicare. When this is the case, it is best to consider the benefits of both before switching.

For government health insurance such as VA benefits, federal employee benefits, Tricare or Indian health benefits, it is best to keep federal coverage. Contact any programs used, such as food stamps, HUD or SSI, to see how Medicare works with benefits.

People who are newly eligible for Medicare should start planning their enrollment as soon as possible. It is important to be aware of the open enrollment period where changes and initial enrollment are allowed.

To learn more about Medicare Part D plans and what options are best for your needs, call us for assistance.