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Medicare Part D Prescription Drug Coverage - Overview

Everyone with Medicare, regardless of income, health status, or prescription drug usage, will have access to prescription drug coverage beginning on January 1, 2006. This program is also referred to as Medicare Part D. Part D is voluntary for most people and the costs are paid for by the monthly premiums of enrollees and Medicare. Unlike Medicare Part B in which you are automatically enrolled and must opt out if you do not want it, with Part D most people have to opt in by filling out a form and enrolling in an approved plan.

The remainder of this topic presents basic information about this coverage in a question and answer format.

What is Medicare prescription drug coverage?

Medicare prescription drug coverage is insurance that covers both brand name and generic prescription drugs at participating pharmacies in your area. Medicare prescription drug coverage provides protection for people who have very high drug costs.

Who can get Medicare prescription drug coverage?

Everyone with Medicare is eligible for this coverage, regardless of income and resources, health status, or current prescription expenses.

When can I get Medicare prescription drug coverage?

You may sign up when you first become eligible for Medicare (three months before the month you turn age 65 until three months after you turn age 65). If you get Medicare due to a disability, you can join from three months before to three months after your 25th month of cash disability payments. If you do not sign up when you are first eligible, you may sign up from November 15 to December 31 each year. Your coverage will start January 1 of the following year.

NOTE: Possible Penalty -- If you don't sign up when you are first eligible, you may pay a penalty if you choose to join a plan later. This monthly penalty continues to increase the longer you wait to enroll in Medicare Part D. When you do join, your premium cost will go up at least 1% per month for every month that you wait to join. You will have to pay this penalty as long as you have Medicare prescription drug coverage.

However, if you presently have prescription drug coverage through an individual or employer plan that offers benefits at least as good as those required by Medicare Part D, you may not have to pay a penalty if you enroll later. Your next opportunity to enroll is from November 15 to December 31 of each year.

How does Medicare prescription drug coverage work?

Your decision about Medicare prescription drug coverage depends on the kind of health care coverage you have now. There are two ways to get Medicare prescription drug coverage. You can join a Medicare prescription drug plan or you can join a Medicare Advantage Plan or other Medicare Health Plans that offer drug coverage.

Whatever plan you choose, Medicare drug coverage will help you by covering brand-name and generic drugs at pharmacies that are convenient for you.

Each Medicare drug plan has a list of the prescription drugs it will cover. These lists are called formularies or preferred drug lists. The formulary must include at least two drugs in categories and classes of most commonly prescribed drugs to people in Medicare. When comparing plans, it’s important to find the plans that cover all or most of the drugs you take.

Under current law, prescription drug plans can change which drugs they cover as long as they provide 60 days notice to their enrollees. However, you can only change plans during the annual open enrollment period; you cannot change during the year.

You must fill your prescriptions at a pharmacy that is in your drug plan’s network, except in special circumstances. So looking at which pharmacies are used by each plan available to you is important when comparing them. Many plans will also offer a mail order service that will deliver drugs to your door.

Like other insurance, if you join, you will pay a monthly premium, which varies by plan, and a yearly deductible (no more than $295 in 2009). You will also pay a part of the cost of your prescriptions, including a copayment or coinsurance. Costs will vary depending on which drug plan you choose. Some plans may offer more coverage and additional drugs for a higher monthly premium.

See the "Standard Coverage" section of the Medicare Part D Prescription Drug Coverage - Frequently Asked Questions topic for a comprehensive explanation of the minimum benefits all drug plans must provide.

Why should I get Medicare prescription drug coverage?

Medicare prescription drug coverage provides greater peace of mind by protecting you from unexpected drug expenses. Even if you don't use a lot of prescription drugs now, you should still consider joining. As we age, most people need prescription drugs to stay healthy. For most people, joining now means protecting yourself from unexpected prescription drug bills in the future.

What if I have a limited income and resources?

If you have limited income and resources, and you qualify for extra help, you may not have to pay a premium or deductible. There is extra help for people with limited income and resources. See the Medicare Part D Prescription Drug Coverage - Extra Help With Costs topic for comprehensive information.

Almost 1 in 3 people with Medicare will qualify for extra help and Medicare will pay for almost all of their prescription drug costs. You can apply or get more information about the extra help by calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778) or visit:
http://www.socialsecurity.gov/.

Additional Information

Lists by state of Medicare Prescription Drug Plans and Medicare Advantage Plans and other Health Plans with prescription drug coverage by state including information on cost, coverage and convenience are available through the Medicare web page Landscape of Local Plans State-by-State Breakdown, online at:
http://www.medicare.gov/medicarereform/map.asp

An interactive tool that allows you to narrow your search for a Medicare prescription drug plan based on your personal preferences such as cost, coverage and convenience is available through the Medicare web page Medicare Prescription Drug Plan Finder, online at:
http://www.medicare.gov/mpdpf/home.asp

Another interactive tool that lets you enter the drugs you use to find out which plans in an area have formularies that cover these drugs is available through the Medicare web page Formulary Finder for Prescription Drug Plans, online at:
http://formularyfinder.medicare.gov/formularyfinder/selectstate.asp

See Also

Medicare - Overview

Medicare Part D Prescription Drug Coverage - Frequently Asked Questions

Medicare Part D Prescription Drug Coverage - Interaction With Other Programs

Medicare Part D Prescription Drug Coverage - Extra Help With Costs

Medicare Part D Prescription Drug Coverage - Glossary

Source

http://www.medicare.gov/Publications/Pubs/pdf/11102.pdf

http://www.medicare.gov/pdphome.asp

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