Medicare offers prescription drug coverage through traditional Medicare or through a Medicare Advantage plan, and about 80 percent of people with Medicare–40 million–take advantage of it. Here are three things to know about Medicare Part D drug plans and some information on costs.
Enrollment: If you have traditional Medicare and you don’t have drug coverage through your job, you might also want to have prescription drug coverage through a private insurer under Medicare Part D. If so, you should sign up at the same time you sign up for traditional Medicare so that you have full coverage. You might also need a Part D plan if you are enrolled in a Medicare Advantage plan. If your income is low, you are eligible for help paying the cost of this coverage. Call 1-800-Medicare (1-800-633-4227) to enroll.
Coverage: The Medicare drug benefit covers a part of your total drug costs. Each drug plan covers different drugs, under different conditions, and charges you different amounts for those drugs. Because there is little standardization regarding what these plans cover, whether you need special authorization, and how much you pay and some terms can change at any time, it can be hard to figure out which plan to choose. Click here for a Medicare tool that can help you choose a drug plan. Keep in mind that each fall you will need to study your options if you want to keep your costs down, since most drug plans change their premium, deductibles, copays and benefits from one year to the next.
- Most drug plans will make you pay more for your drugs after you and your plan have spent $3310 on covered drugs. ($3,700 in 2017) At that point, you are in the coverage gap, sometimes called the “donut hole.”
- Unless you are enrolled in the “Extra Help” program, which protects you from the coverage gap, you will be eligible for the Coverage Gap Discount Program.” Under that program, you’ll pay 45% of the drug plan’s costs for covered brand-name drugs.
- No matter which plan you choose, after you’ve paid $4850 of your own money for covered drugs, ($4,950 in 2017) Medicare will pick up 95% of the cost of your drugs, or you will pay a small copay. To learn more, click here.
Access: Each drug plan has its own rules on where you can fill your prescriptions. More and more have pharmacy networks and your costs will differ based on which pharmacy you use. Check to make sure the plan’s requirements meet your needs, both in your community and while you’re traveling.
For more information on how to save money on your prescription drugs, click here.
Here are some helpful facts from the Kaiser Family Foundation about the 2016 Medicare drug benefit:
- The average drug plan monthly premium is $41.46. Some are as high as $60.
- Two out of three plans have a deductible, an amount you must pay before the plan starts covering your drugs. The deductible can be as high as $360.
- Many drug plans now charge coinsurance, a percentage of the cost, for brand-name and specialty drugs. They also tend to charge you different amounts depending on the pharmacy network you use.