Medicare Part D is the prescription drug coverage available to people with Medicare who have Medicare Part A and/or Part B and live in a Part D plan’s service area. The Part D benefit is available through private plans that are approved by Medicare.
Each Part D plan can vary in cost and the drugs covered, and plans can change from year to year. A plan that covers certain prescriptions this year might change and not cover them next year.
Enrollment in Part D
There are certain periods when a person with Medicare can enroll in Part D. One is the Initial Enrollment Period, when the person first becomes eligible for Medicare. There are also Special Enrollment Periods, such as when a senior retirees and loses employer drug coverage, or when a person moves out of one Part D plan’s service area to another area.
The Annual Enrollment Period occurs from Oct. 15 to Dec. 7. During this time, people with Medicare can join, disenroll, or switch Part D and/or Medicare Advantage plans (many of which also offer prescription drug coverage).
People who choose to enroll in Part D outside of their Initial or Special Enrollment Periods may face a late penalty, depending on the circumstances. This penalty may result in higher monthly premiums for the rest of the time that the individual has drug coverage from Medicare, unless he/she qualifies for the Part D Low Income Subsidy (LIS/Extra Help).
Costs of Part D
Most people enrolled in a Part D plan (and not eligible for LIS/Extra Help assistance) have out-of-pocket expenses. Expenses may include:
- A monthly Part D plan premium (average premium in 2017 is $34),
- An annual deductible (maximum $400 in 2017),
- A cost-sharing portion of plan-covered drugs (either a copayment or coinsurance during the Initial Coverage Period),
- A percent of the cost of drugs during the Coverage Gap (or “donut hole” should the person fall into it), and
- If they reach the Catastrophic Benefit Period in their Part D drug benefit (only 1-5% of beneficiaries do), minimal drug copayments or coinsurance costs.
Be sure to check out our chart of costs in Part D to understand these expenses in the current year. It is important to remember that people change and plans change. Everyone with Medicare Part D should re-assess Part D coverage during the Annual Enrollment Period to determine whether their plan continues to best suit their prescription needs in the coming year.
Resources for benefits counselors
The Resource Library contains a wide range of publications aimed at helping benefits counselors understand the nuances of Part D and how to help clients with Medicare select coverage. Included among these are fact sheets on the requirements of all Part D plans, standard and alternative Part D plans, and options for drug coverage through Part D or Medicare Advantage. Also included are publications about what drug plans may/may not cover, off-label drug coverage rules, medication therapy management, the Part D donut hole/coverage gap, and Best Available Evidence policy.
Be sure to check in annually during the Open Enrollment Period to download our guide to mailings and key events, and toolkit.
Tools for seniors
If you know an older adult who seeks assistance in exploring their drug coverage options, direct them to:
- BenefitsCheckUp® is a free online tool that screens for eligibility for thousands of programs that can pay for health care and other costs, including prescription drugs.
- My Medicare Matters, an educational site from NCOA that helps people explore Medicare and answer a few questions to get recommendations about next steps in choosing coverage.
- Their local State Health Insurance Assistance Program (SHIP). SHIPs are federally funded to provide free, objective assistance to people with Medicare and their families. To find your SHIP, call toll-free 877-839-2675 or visit the SHIP TA Center website.