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Medicare Part D

Medicare Part D or Prescription Drug Coverage is a drug program that helps pay for the costs of prescription drugs  

How do I enroll in Medicare Part D?

  • An individual can purchase Medicare Part D as a stand-alone Medicare Prescription Drug plan (also know as PDP). Most people who purchase a stand-alone drug plan, typically purchase it with a Medicare Supplement Plan, which does not include drug coverage.

  • An Individual can also obtain a Medicare Part D plan through purchasing a Medicare Advantage Plan.

Important things to know about Medicare Part D

  • Formulary - A formulary is a list of drugs that a plan covers.  Each plan has its own formulary.  Before you enroll, be sure your drugs are covered.

  • Tiered Formulary - Many plans use tiered formularies to group covered drugs according to cost.

For example:

  • Tier 1 - Preferred generic drugs

  • Tier 2 - Generic drugs

  • Tier 3 - Preferred brand name drugs

  • Tier 4 - Non-preferred drugs

  • Tier 5 - Specialty drugs

  • Some drugs require quantity limits and prior authorization.

  • You may ask the plan to cover your drug even if it is not on the drug list.  This is known as a formulary exception.  

 

  • You may also ask to waive coverage restrictions on your drug.  This is known as a utilization exception.

Understanding Medicare drug payment stages

Annual Deductible​

  • You pay the total cost of your drugs until you reach the deductible amount set by your plan

  • Not all Part D plans have a deductible

  • If your plan does not have a deductible your coverage starts with the first prescription you fill

Initial Coverage

  • You pay a co-pay or co-insurance (percentage of a drug's total cost) and the plan pays the rest

  • You stay in this stage until your total drug costs reach $3,820​

Coverage Gap (Donut Hole)

  • You pay:

  • 25% of the costs for brand name drugs

  • 37% of the costs for generic drugs

  • You stay in this stage until your out-of-pocket costs reach $5,100

Catastrophic Coverage

  • You pay a small co-pay ($3.40/$8.50) or co-insurance amount

  • You stay in this stage for the rest of the plan year

Have Questions?