Medicare Prescription Drug Plan
Medicare Part D, the prescription drug benefit. How it works, how to enroll, and when you can change it.
Medicare Part D
When you turn 65 you have the option of getting a Prescription Drug Plan from Medicare. We recommend that everyone with a Medicare Supplement consider one.
If you have a Medicare Advantage plan, drug coverage is usually built in and you do not buy a separate one. A few plan types do not include it, so check your plan's summary of benefits or ask us.
Who needs a Part D plan
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If you have Original Medicare with a Medicare Supplement, you buy a separate Part D plan.
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If you have a Medicare Advantage plan, drug coverage is usually included. Check your plan before you buy a second one.
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If you go 63 days or more in a row without Medicare drug coverage or other creditable drug coverage, a permanent late enrollment penalty applies. See below.
The cost of a prescription drug plan varies based on the medications you actually take. Two people on the same street can have very different best plans. That is why the choice is made against your own medication list rather than against a general ranking.
The Do It Yourself System Is Genuinely Good
We are not always fans of government computer systems. This one is the exception. The online enrollment program for Medicare prescription drug plans is superlative.
Many agents, ourselves included, made the decision not to sell prescription drug plans, because the Medicare enrollment system makes it so simple to do yourself. Entering your own medication list is the whole trick, and nobody knows that list better than you do. The system lets you:
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Look at the most competitive plans available to you.
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Enroll in the plan that offers the best value for your specific medications.
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Verify each year that you still have the most cost effective plan.
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Change plans if you want to, during the annual open enrollment. Enrolling in a new drug plan automatically cancels the old one.
What we do instead is teach you how to use it. When we meet to help you enroll in your supplement, we walk you through the prescription drug system and give you a step by step tutorial. Print the tutorial first, then follow it screen by screen. Follow it carefully and you will identify the plan that offers the best value for your needs and budget, then click Enroll.
You can start at Medicare.gov, or call 1-800-MEDICARE. If you would rather have somebody sitting next to you the first time, that is what the appointment is for.
Your initial enrollment
Your first Part D plan goes in around the same time as the rest of your Medicare coverage. We cover it in the same one hour appointment where we set up your supplement, so you leave with everything handled rather than a homework list.
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We educate you on how the Medicare prescription drug enrollment system works.
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We provide a printed tutorial so you can follow the steps at your own pace.
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You enter your own medications, which is what makes the result accurate.
Annual Open Enrollment: October 15 to December 7
For most people this is the one window each year to change prescription drug plans, so mark it on the calendar. As our client, we alert you before it opens so it does not slip past. There are exceptions: a permanent move, leaving employer coverage, losing creditable coverage, or qualifying for Extra Help all open a Special Enrollment Period. If your circumstances change mid year, call us before you assume you have to wait.
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Check every year that your plan is still the best value for the medications you take now.
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If you do not like your current plan, or the premium has risen more than you like, this is when you change it.
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A new plan chosen in this window begins January 1, and the system automatically cancels your old plan.
Review your drug plan every single year
A Part D plan is the one piece of your Medicare coverage that deserves a fresh look annually. Two things move underneath you. Plans change their formularies and their premiums each year, and your own medication list changes as your doctor adjusts your care.
The plan that was the best value for you last year may not be this year, even if nothing about your health has changed. Spending twenty minutes in the Medicare system each autumn is the cheapest insurance review you will ever do. Your Medicare Supplement benefits, by contrast, are set by law and do not change, though the premium does rise over time, which is worth a look each year even if the coverage does not need one.
There is now a yearly limit on what you pay for covered drugs
Part D now has an annual limit on what you pay out of pocket for covered drugs. Once you reach it, you pay nothing more for covered Part D drugs for the rest of the calendar year. Medicare resets that limit each year, so we confirm the current figure with you rather than print one here. For anyone taking an expensive medication, this ceiling is the strongest reason to be in a plan.
There is also a Medicare Prescription Payment Plan that lets you spread those costs evenly across the year instead of paying them all at once. If your medications are expensive, ask us about it.
What if I do not sign up for a prescription plan?
If you go 63 days or more in a row without Medicare drug coverage or other creditable drug coverage, you build up a penalty of 1 percent for each full month you went uncovered. Creditable coverage from an employer, a union, the VA or TRICARE counts, and while you have it no penalty accrues. Your plan has to tell you in writing each year whether its drug coverage is creditable, so keep that notice.
Go five years without creditable coverage and that is 60 uncovered months, so the penalty is 60 percent of the national base beneficiary premium. That is a figure Medicare sets each year, not the cost of the plan you pick. It is rounded to the nearest ten cents and added to your monthly premium, and because the base figure is reset annually the penalty can drift up over time.
The penalty stays with you for as long as you have Medicare drug coverage, even if you switch plans. The one way out is qualifying for Extra Help, which removes it. Even if you take no medications today, this is the reason most people enroll anyway.
Want Help With Your Drug Plan?
We teach you the Medicare enrollment system and give you a printed tutorial to follow. There is never a charge for our services.