What is Medicare Part D Prescription Drug coverage?

What is Medicare Part D?

Not sure if a Medicare Part D plan is right for you? HealthSpring can help. First off, let’s explore what Medicare Part D is.

Medicare Part D prescription drug plans are part of the government’s Medicare program, like Original Medicare (Part A and Part B) and Medicare Advantage plans (Part C). Part D plans help lower the cost of your prescription drugs. You may also know Medicare Part D as the Medicare prescription drug benefit.

How do Medicare Part D plans work?

In general, a Medicare Part D plan has three stages that last for the entire plan year:

Deductible: In the first stage, you have to pay 100% of your plan’s annual deductible. A deductible is the set amount you need to pay before your health plan will start to help pay for your health care costs. In the case of Part D, these are the costs of your prescription drugs. The deductible is determined by your insurer.

Initial Coverage: Now that you have met the deductible, your Medicare Part D plan will begin to help cover some of your prescription costs. You will pay either a copay (a set dollar amount) or coinsurance (a set percentage of the total cost). The initial coverage stage lasts until you pay a total of $2,100¹ in out-of-pocket prescription costs.

Catastrophic Coverage: In the last stage, your covered Part D prescriptions are $0. Stages restart every year on January 1. You pay nothing for the remainder of your plan year. Once the new plan year begins, you start the three stages over again.

Which drugs are covered by Medicare Part D?

Do you take prescription drugs to help manage a chronic condition, such as heart disease or high cholesterol? If so, Part D will help you pay for them and any prescription drugs you take to stay healthy. Part D plans will also help pay for the prescriptions you take for a short time, like antibiotics.

Did you know there are times when Medicare Part B will pay for your prescription drugs? Let’s discuss the differences between Medicare Part B and Part D.

How can you get Medicare Part D?

Part D plans are offered and managed through private insurers, like HealthSpring. Medicare states that Part D plans must provide you with a minimum standard level of coverage. Otherwise, Part D plans can differ between insurers by level of coverage, drug list (also called formulary), pharmacy networks and monthly premium.

Are you entitled to Medicare Part A and/or enrolled in Part B? If so, there are two ways you can get Part D prescription drug coverage:

• Enroll in a standalone Part D plan when you turn 65 or first quality for Medicare. You can also enroll during the Annual Enrollment period, October 15 - December 7.

• Enroll in a Medicare Advantage plan (Part C), which combines Part A, Part B and often includes drug coverage (Part D)

Medicare Part D At a Glance:

• Part D plans are part of the government’s Medicare program
• Enrollment is optional. Plans are offered by private insurers, like HealthSpring
• Helps lower your prescription drug costs

How do you choose a Medicare Part D plan?

Not sure how to choose the right Medicare Part D plan for you? Here are some factors to keep in mind:

• First, it’s important to consider the medications you take. This will help you select a plan that covers your prescription drug needs for the entire health plan year.

• Part D plans offer different levels of coverage for different tiers of drugs to help lower your prescription drug costs. And depending on your needs and current prescription drug coverage, you can choose a plan from a variety of different cost and benefit levels.

• Are you married? If so, Medicare requires you and your spouse to pay separate premiums, deductibles, copays and coinsurance for prescription drug coverage.

What costs are involved in a Medicare Part D Prescription Drug Plan?

Your out-of-pocket costs for a Part D prescription drug plan may include:

• Your Part D premium is a standard fee you may have to pay each month to your plan for providing you with coverage.²

• As part of your Original Medicare coverage, you will have to continue to pay your Part B premium.

• You and Medicare share the costs of your prescription drugs. Medicare will pay for a part of your prescription drugs through your health plan. And you are responsible for the remaining cost, either as a copay or coinsurance.

• Enrolled in a Medicare Advantage Plan (Part C) that also includes drug coverage? Then your monthly premium will include both the medical and drug portion of your plan.

• And, you may have to pay a late enrollment penalty (LEP) if you don’t enroll in a Part D plan during your Initial Enrollment Period. Medicare will charge you a fee each month you delay enrolling. The LEP fee will be added to your monthly premium.

Is financial help available to pay for Medicare Part D?

Yes, Medicare provides financial assistance if you have a limited income. This assistance is known as Extra Help. If you qualify, you will receive help paying your out-of-pocket prescription drug costs, like annual deductible (if applicable) and copays or coinsurance.