Plans for Health

Heard about Medicare Part D RX?

If you’re turning age 65 soon or did recently…

We’ll bet you have.

In the midst of the bombardment of mail you’ve received in your stuffed U.S. Postal Service mailbox you may have caught some language describing “Medicare Part D” prescription plans. 

When switching to Original Medicare A+B (PPO style coverage) the prescription coverage is handled differently than your employer based group insurance.

Your  Medicare Part B Prescription Drug plan operates just like your prescription benefits did on your prior pre-65 plan, it just happens to be a separate insurance plan now

Here's a quick checklist of all the Medicare Part D subjects we'll cover. Feel free to jump ahead to any section:

A Quick History of Medicare Part D

Hard to believe, but prescription drug coverage did not exist in Medicare, the health insurance program for our nation’s seniors who need it most, prior to 2006.

In 2003 President George W. Bush ignored complaints from Republicans and Democrats & signed into law the Medicare Modernization Act, finally adding crucial prescription drug coverage to Medicare.

The bill was met with polarizing displeasure from both political parties, with many Republications worried about the government expansion and Democrats feeling the coverage was too weak.

With all it’s failings, and the bill was certainly not perfect, at least it established sorely needed prescription drug coverage for seniors who were previously stuck paying cash for essential prescriptions.

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

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.

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

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.

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.

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.

Medicare 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.

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

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

Can I use my local pharmacy?

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

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.

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.

If you want some help or have questions on using your pharmacy please contact us at 1-866-486-6551 or email

An Instant Quote can be run anytime here:

What about mail order pharmacy service?

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. 

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…

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

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

-free delivery on standard order

What do the plan benefits cover?

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..

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


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

Deductible:  Currently the highest level deductible allowed is $435 which is why you’ll see that deductible number frequently when quoting plans

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

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.).

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.

Coverage Gap

Originally called the ‘Donut Hole’, because someone in marketing thought it sounded more fun.  Once $4020 is reached in cost between you and the insurance carrier the Coverage Gap phase begins.  Here, it’s really simple.

You’ll pay 25% of the cost for generic medication.  Brand medication your co-pays continue as previous coverage.

There, was that tough?

Once the 25% out of pocket reaches $6,350 in combination with your other expenses:  deductibles, co-pays, coinsurance etc.. the Coverage Gap ends and you exit to the final stage.

Catastrophic Coverage

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

The scary plan name with the good coverage!

Once Catastrophic Coverage phase begins you will pay very limited amounts out of pocket.  

Typically this number is a very small co-pay or 5%, whichever is greater.

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

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

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

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

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

How much does it cost?

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:


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.

Medicare Part B Premium:  You will still have your Medicare Part B premium.  Average cost is $144.60.  

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

What if you're low income?

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

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.

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

  • 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. 

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

IRMAA=  Medicare Income-Related Monthly Adjustment Amount

The funny name, with the not so funny impact.

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.mIf 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.

Here is a table showing the income guidelines. 

Table Guide: First determine your tax filing status, then pull up your 2018 income.  Your IRMAA status is 

the following:

Individual Tax Return FilerJoint Tax Return Filer Married and Separate Tax Return FilerYou pay Part D IRMAA every month (in 2020)
under $87,000 under $174,000 Under $87,000Part D plan premium
between $87,000 & $109,000between $174,000 & $218,000N/A$12.20 & Part D plan premium
between $109,000 & $136,000between $218,000 & $272,000N/A$31.50 & Part D plan premium
between $136,000 & $163,000between $272,000 & $326,000N/A$50.70 & Part D plan premium
between $163,000 & $500,000between $326,000 & $750,000between $87,000 & $413,000$70.00 & Part D plan premium
$500,000+$750,000+$413,000+$76.40 + your plan premium

Social Security department will be in touch with you if IRMAA fees are due.  Or, for more information ahead of time you can call the Social Security department at at 1-800-772-1213.

Penalties, Penalties, Penalties.

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

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.

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

The penalty calculation works like this:

Multiply 1% of the “national base beneficiary premium” ($32.74 in 2020) 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.  

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

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

12 months * 1% of 32.74  =$.33

So, $.33 *12 months =$3.96 monthly premium penalty or $47.52 each year.  But here’s the kicker…FOREVER.

Need Help?

Please give us a call at 1-866-486-6551 or email is

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!

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