How do I choose the right Medicare Part D Prescription plan for me?

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It feels overwhelming but it is really simple. The best plan for you is the one which does the best job covering the prescriptions you are actually taking.

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Is it choosing the same old insurance carrier you are familiar with for all these years?  NO!

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Then, should you go with the same Medicare Supplment insurance carrier just to have one bill?  NO!

The first thing to consider is what medications you are taking.

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Can I use my local pharmacy?

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You CAN use your local retail pharmacy. This is also definitely an important part of the plan decision making process!

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When choosing your insurance carrier you can check the provider directory to make sure your local retail pharmacy is contracted with your plan.  Pharmacy verification is done is coordination with the drug formulary list to make sure you medications are covered.

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If you visit an out of network pharmacist, the drug insurance plan negotiated contract rates and co-pay benefits do not apply!

Result?  You may pay more out of pocket for your prescriptions which could get really expensive quick.

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If you want some help or have questions on using your pharmacy please contact us at 1-866-696-8636 or email help@plansforhealth.com.

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An Instant Quote for Part D Medicare Prescription plans and enrollment application can be run anytime here:

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Drug Formulary Lists

 

Drug Formulary Lists are the key when deciding on what Part D RX plan to choose.  A drug formulary list contains the medications which are covered by contract on the Part D plan offered by each insurance carrier.

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The MOST important factor is to get as many of your prescription drugs listed as covered on the drug formulary list of the Medicare Part D plan.

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www.plansforhealth.com offers a great tool called the “plan finder“ where you can enter your prescription drug names & dosages.  

 

The Medicare Plan Finder will then give you a list of premium and medical expense costs for Part D RX plans based on the prescriptions you take and the pharmacy you prefer to use.

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If you have any questions on Medicare Plan Finder, or would like assistance using the tool please contact us at 1-866-486-6551 or email help@plansforhealth.com.

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Or, help yourself to a free instant quote here 24/7

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What about mail order pharmacy service?

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Mail Order prescriptions are available on most Medicare Part D insurance carrier plans.  It can be a great way to reduce cost and get better convenience. 

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SilverScript, a leading carrier of Medicare Part D insurance plans, offers the following benefits for enrolling eligible medications in ‘mail order’ service.  For example, they provide qualifying mail order members…

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-allow a 90 day supply of medications at no delivery charge

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-preferred pharmacy expense split for tier 1 & tier 2 rx during initial coverage phase

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-free delivery on standard order

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What do the plan benefits cover?

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Medicare Part D plans have established standard level requirements from the federal government.  

The insurance carriers can change or tweak your coverage only by adding to standard level which is why you’ll mainly see only two types of plans:  

 

a)  plans with a deductible that are less expensive for premiums but require you to pay more up front initially or..

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b) plans with zero deductible which have stronger up front coverage but cost more for monthly premiums

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STAGES of COVERAGE

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Medicare Part D plans have a few ‘Stages’ of coverage level depending on how much expense has occurred in the plan year.

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Deductible  

 

Currently the highest level deductible allowed is $590 which is why you’ll see that deductible number frequently when quoting plans

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Initial Coverage

 

After the deductible is satisfied, if there is a plan deductible, you enter an initial coverage phase. 

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During this phase you split cost, or sometimes called ‘cost share’ with the insurance carrier either paying your plan ‘co-pays’ (flat dollar amounts like $5 or $15) or coinsurance which is a percentage split (20%, 30% etc.).

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This prescription plan works almost just like your old typical health insurance plan, with some small twists!

Once you’ve reached $4,020 for the plan year 2020 in total cost between both you and the insurance carrier the ‘initial coverage limit’ is met.

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Coverage Gap

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Let's cover it historically and then get to the good news.

   

Originally called the ‘Donut Hole’, because someone in marketing thought it sounded more fun.  Here's the original design:  Once $4020 is reached in cost between you and the insurance carrier the Coverage Gap phase began. Then, you'd pay 25% of the cost for generic medication.  Brand medication your co-pays continue as previous coverage.

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Here's the good news.

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In 2025 the Coverage Gap or Donut Hole no longer exists!

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You simply typically pay an average of 25% of the brand medication cost after deductible if there is one.  On generics there is smaller co-pays in the $10-$25 range usually.

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There, was that tough?

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Once the member out of pocket reaches $2,000 in combination with your other expenses:  deductibles, co-pays, coinsurance etc.. the member out of pocket ends and you exit to the final stage.

 

Catastrophic Coverage

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It’s a scary name but don’t worry, things get really good now.  Nothing to be afraid of here.

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The scary plan name with the good coverage!

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Once Catastrophic Coverage phase begins you will pay zero out of pocket starting in 2025.

 

Prior years had member paying 5% coinsurance out of pocket but that cost responsibility is now phased out. 

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If I enroll in a plan, am I stuck on it?

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In short, no.  But there are rules.

 

There are options to get your Medicare Part D plan changed at the national open enrollment each year.

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The open enrollment is held annually from October 15th to December 7th.  You might see this called “AEP”, or Annual Election Period, elsewhere.

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During this time you can change your plan and insurance carrier regardless of your health history, medical condition, or prescriptions taken.

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If you make a plan or insurance carrier change your new plan effective date is January 1st.

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How much does it cost?

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Perhaps this should be the first question.  There are several different types of costs you will pay for prescription costs. 

Here’s a quick breakdown of the main cost areas:

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Premiums   

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The insurance carriers set the monthly premium costs for enrolling in the Part D insurance plans.

 

Each Medicare Part D plan has a separate monthly premium from the premium cost of Medicare Parts A & B with Original Medicare. 

 

The insurance carriers base the premiums on the strength of coverage, location, drugs on the formulary list etc..  

Medicare Advantage plans typically bundle the premium of Part D RX within the single health plan premium cost, no separate/additional premium to be paid.

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Medicare Part B Premium:  You will still have your Medicare Part B premium. 

 

Average cost is $185 currently monthly. 

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What if you’re high income? Does it cost more then?  Well, yes with limitations.  Here is the table on the Medicare.gov website with brackets based on income for high income families.

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What if you're low income?

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Is there a reduced cost for Medicare Part D or assistance with medical expenses?

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That is available too!  If you’re low income and think you may qualify for Extra Help with your prescription costs there are a variety of programs you may qualify for, such as Medi-Caid, Supplemental SSN reduction of co-pays etc.

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Find out your level of Extra Help assistance on the Medicare.gov website.  Extra Help comes in many forms.  Some of them are:

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• Reduced premiums

• Lower co-pays or coinsurance

• SSDI

• Medi-Caid

• Institutional assistance

 

Prescription co-pays:  Flat dollar amounts for medical services or expenses. For example $5 generic co-pay, or $25 brand drug co-pay during the Medicare Part D Initial Coverage Period. 

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Prescription co-insurance: Percentage cost split.  For example 25% coinsurance during the Medicare Part D Benefit period means you pay 25% of the bill, and the insurance carrier pays 70%

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IRMAA=  Medicare Income-Related Monthly Adjustment Amount

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The funny name, with the not so funny impact.

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Sure, it sounds like the name of a distant Great Auntie, but unfortunately IRMAA is a Medicare Part D price increase for high income families. 

 

If your income is above certain levels you will have to pay the IRMAA, or Income Related Monthly Adjustment Amount, directly to Medicare, not the insurance carrier as part of your Part D monthly premium.

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Here is a table showing the income guidelines.  Use your income amount from 2 years prior.

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Table Guide:

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Penalties, Penalties, Penalties.

What is the penalty for not enrolling? Like many things in life, there can be consequences for putting something off. 

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The initial eligibility period (you’ll hear it called IEP sometimes) for Medicare Part D RX for most people generally speaking is when you turn 65, unless you are still employed and lucky enough to receive employer sponsored group health insurance coverage.

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If you miss this eligibility window for longer than 63 days you may be subject to a penalty. 

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The penalty calculation works like this:

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Multiply 1% of the “national base beneficiary premium” = $36.78  times the number of full, uncovered months you didn’t have Part D or creditable coverage. The monthly premium is rounded to the nearest $. 10 and added to your monthly Part D premium.  

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Uh, say what? In a nutshell, it sounds terrible but the reality of the penalty dollar cost is not too bad.  

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If you missed 12 months for example your penalty currently would be:

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12 months * 1% of $36.78  =$.37

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So, $.37  *12 months =$4.44 monthly premium penalty or $53.28 each year.  But here’s the kicker… it's FOREVER.

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Need Help?

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Please give us a call at 1-866-696-8636 or email is help@plansforhealth.com

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We are happy to answer all your questions, run formal quotes, or just sort through all the Medicare information for you and explain what may work best for you!

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You can also visit our FAQ page to review Q&A online.

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Schedule an phone appointment on our calendar.