In Original Medicare, your basic health services are covered by both Medicare Part A (Hospital) and Part B (Physician and Outpatient). The Federal Governmental agency the Center for Medicare and Medicaid Services (CMS) operates this. Part D (Prescription Drugs), on the other hand, is operated by private companies — often insurance companies or drug companies — who have contracts with Medicare.
Should You Enroll in Part D?
While Part D programs are voluntary, you may be penalized should you not enroll in a Part D drug plan when first eligible to do so. You can enroll in a Part D plan when you have Part A, Part B, or both Part A and Part B. The premium can be automatically deducted from your Social Security or Railroad Retirement benefit check or paid through your checking account. If you have low income, you may be eligible for “extra help” from Social Security and can submit an application on their website. If you receive “extra help,” it may reduce or eliminate any late enrollment penalty that you have and reduce the cost of your prescription drugs, reduce the cost of your drug plan premium, and eliminate the coverage gap.
Part C: Medicare Advantage
If you get your Medicare services through Part C, Medicare Advantage, these plans usually have a part D plan included in them. Therefore, you are automatically enrolled in a Part D Prescription Drug Plan when you enroll in a Part C or Medicare Advantage Plan with Drug Coverage.
CAUTION: Sometimes Part C plans do not include a drug plan. These plans may or may not permit you to enroll in a stand-alone Part D Prescription Drug Plan. Our Brokers can guide you here. Trying to navigate this on your own could result in the cancellation of your Part C plan when you add a Part D plan.
Use the Government Plan Finder to Compare
To accurately assess the best drug plan, it is critical that you provide a list of your current drugs to your broker, and that your broker enter your drugs into medicare.gov plan finder. Plan finder will use all the algorithms that Medicare employs to analyze drug prices and plans available to you and will develop a list of plans that are rank ordered to best suit your needs. It is, of course, dependent upon the interpretation of the expertise of your broker to explain the plans to you, so that you can make a decision about which plan would be best.
There seems to be a large amount of nomenclature to become familiar with around drug insurance plans. And this barrier is fairly well-bridged as one looks into options, so do not be daunted at first as the learning curve seems steep to most, but it is within reach of all.
Deductibles and Drug Tiers
First, a few notes about starting costs, using words that are a little more familiar to folks. for Part D drug plans, deductibles — the portion the insured pays before the policy takes effect — are capped at $415 for the year 2019. Some plans have a $0 deductible and some plans have a deductible that is less than the $415 permitted by Medicare. Some plans have a $0 deductible for Tier 1 and 2 drugs but a $415 deductible for Tier 3, 4, and 5 drugs. There’s another new term: tier. All of the prescription drugs have been divided into tiers. Each plan can divide its tiers in different ways. Each tier costs a different amount. Generally, a drug in lower tiers will cost you less than a drug in a higher tier.
The premium for Part D prescription drug coverage is independent and in addition to the premium for Part B.
Some drugs are not covered on some plans. Formulary (also likely a new term) is the list of covered drugs for each plan and offers generic options as well as brand name drugs. Formulary will play a significant role in plan selection as the cost of specific drugs not on the formulary will be priced to the consumer at retail.
We will search for plans where all drugs are on the client’s formulary.