Part D is the newest section of Medicare. It was signed into law in 2003 as part of the Medicare Prescription Drug Improvement and Modernization Act. The prescription drug benefits began January 1, 2006. Medicare prescription drug coverage, also known as Medicare Part D is a comprehensive drug benefit. Medicare Part D is an optional program that helps pay for prescription drugs. It does this through a variety of plans offered by private companies that have been approved by Medicare. Part D is often called the "Medicare Prescription Drug Program, (PDP)."
Medicare Prescription Drug Coverage offers:
- prescription drug coverage for everyone with Medicare regardless of income and resources, health status, or current prescription expenses;
- both brand name and generic prescription drugs at participating pharmacies convenient to beneficiaries;
- protection for people who have very high drug costs or from unexpected prescription drug bills in the future.
- provides low cost drug coverage to people with limited income and assets
The program can dramatically reduce the cost of your medications. Remember, unless you qualify for Extra Help, this program is designed to share the costs with you, not pay all of your medicine costs.
Medicare Drug Plans
Medicare Part D is a voluntary prescription drug benefit. The drug plans are offered by insurance companies and other private companies approved by Medicare. People can choose to join a Medicare drug plan that meets their needs based on coverage, cost, convenience, and customer service. There are many plans to choose from. Drug plans may vary in what prescription drugs are covered, how much someone has to pay, and which pharmacies can be used. All drug plans will have to provide at least a minimum standard level of coverage, which Medicare will set. However, some plans might offer more coverage and additional drugs for a higher monthly premium. When a person with Medicare joins a drug plan, it is important for them to choose one that meets their prescription drug needs.
The plans can change premiums, copayments and formularies (list of drugs they cover) every year so reviewing plans during the election period is important.
There are two types of Medicare Drug Plans:
Medicare Prescription Drug Plan (PDP)
These plans add drug coverage to the Original Medicare Plan and some other types of Medicare plans. In 2015, there are 28 plans available in Louisiana.
Click here to view Louisiana prescription drug plans
Medicare Advantage Plan (MA-PD)
This is an HMO or PPO and other Medicare health plan that includes prescription drug coverage. You will get all of your Medicare coverage (Part A and B), including prescription drugs (Part D) through these plans.
All Medicare drug plans must offer at least the standard level of coverage as the original Medicare. Plans can be flexible in their benefit design and offer different or enhanced benefits. Their benefits and costs may change from year to year.
Medicare drug plans will cover generic and brand name drugs. To be covered by Medicare, a drug must be available only by prescription, approved by the Food and Drug Administration, used and sold in the United States and used for a medically accepted indication. Each plan will have a "formulary" that tells you which drugs are covered by the plan. Plans may require prior authorizations, step therapy and quantity limits.
View a list of plans for your area
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When to Enroll
Enrollment into Medicare Part D is not automatic. You may sign up for Part D when you first become eligible for Medicare A and/or B which is three months before the month you turn age 65 until three months after you turn age 65. This is called your "initial enrollment period" or IEP. If you are eligible to enroll in this drug coverage and you do not, you will have to pay a penalty if you join later on, unless you are eligible for extra help with costs. If you have other drug coverage now, you may not have to pay the penalty. If your current coverage is considered “creditable” or at least as good as or better than the Medicare Drug coverage you may not be subject to a penalty. You will need to consult the company offering your current coverage.
If you receive Medicare due to a disability, you can join from three months before to three months after your 25th month of cash disability payments.
Annual Enrollment Period/Open Enrollment Period
If you do not enroll when you are first eligible, your next opportunity will be during the Annual Enrollment Period (AEP), October 15 – December 7. During the Annual Enrollment Period, you can enroll in a plan, change plans or drop drug coverage for the coming calendar year. The new plan will take effect January 1. Generally you must stay in the plan you choose for a calendar year (there are some exceptions). The plans can change premiums, copayments and formularies (list of drugs they cover) every year so reviewing plans during the election period is important. The best way to compare plans is to use the Medicare website. SHIIP counselors can also help you compare plans.
Special Enrollment Period:
In certain situations, individuals with Medicare may be eligible for a Special Enrollment Period (SEP) that allows them to make changes to their Medicare health or drug coverage outside the annual enrollment periods. For a list of these situations, refer to www.cms.gov/home/medicare.asp and select “Eligibility and Enrollment”.
Late Enrollment Penalty
If you do not enroll when you are first eligible and do not have creditable prescription drug coverage for 63 continuous days or more, you may have to pay a late enrollment penalty to join later. The penalty amount is based on when you join. It is added each month to your Medicare drug plan’s premium for as long as you have a plan.
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What if I have an Employer or Union Plan?
Your employer or union should let you know if your coverage will continue, or if they think you should join a Medicare drug plan.
- If you have not gotten any information from your employer or union, call them now.
- If your employer’s coverage is “creditable,” meaning it’s as good as the Medicare drug coverage, you do not need to do anything. You should not sign up for a Medicare drug plan, or you may lose your current coverage.
- If your employer’s coverage is not “creditable,” meaning it’s not as good as Medicare coverage, you should consider signing up for a Medicare drug plan.
If your employer coverage is not as good as Medicare's, you may be tempted to drop it and take the Medicare drug coverage. However, you should talk with your employer or union benefits office before deciding to drop your employer or union coverage. This is an important decision, so consider the following issues very carefully:
- Most employer/union insurance plans do not let you drop just the drug coverage. They require you to drop the whole insurance plan, including hospital and medical care coverage.
- If you drop your employer or union coverage, you may not be able to get it back.
- If you drop your employer or union health benefits, you may have to buy insurance to supplement Medicare. You can buy Medigap insurance, or join a Medicare Advantage plan. The Medicare Advantage plans pay more expenses than Original Medicare Part A or B does, and they include a Medicare Prescription Drug Plan. But these plans may cost you more than your employer or union health plan does. They may also give you fewer benefits.
- IMPORTANT: If you change your part of the insurance plan, your spouse or dependents may not be able to get health care and prescription drug benefits.
For these reasons, do not drop your employer or union coverage until you have thought about it carefully.
I do not take any drugs now, so why should I enroll now?
We all want to stay in good health, but no one can predict the future. These plans are insurance that covers the cost of prescription drugs. If your health changes and you need more medicines, this insurance will help pay for your drugs and protect you from very high drug costs.
If you enroll later, you may have to pay higher monthly premiums for the rest of the time you have drug coverage from Medicare.
What Does Standard Medicare Prescription Drug Coverage Look Like in 2015?
Individuals will pay a plan premium. Premiums will vary depending upon the plan selected.
How much are the premiums for these Part D plans?
Costs for these plans vary from $15.70 through $129.80. Twelve plans have $0 deductibles.
Click here to view Louisiana prescription drug plans
Will my prescriptions be covered?
Each Part D plan will list the prescriptions that are covered under the plan; this list is called a formulary. The simplest method of determining if your drugs are covered is by using the planfinder or by contacting SHIIP or the local Council on Aging.
Can the formularies on Part D plans change?
The formularies, which are lists of the prescription drugs covered, can change. The companies must give the beneficiaries at least 60 days notice of change.
What is the Part D donut hole or coverage gap?
Medicare drug plans may have a coverage gap which is sometimes called the “donut hole.” A coverage gap means that after you have spent a certain amount of money for covered drugs; the beneficiary will have to pay all the costs for the drugs while in the gap. This amount does not include the plan's monthly premium. Once the beneficiary has reached the out-of-pocket limit, then catastrophic coverage begins.
View the 2015 Standard Part D Benefit
What is the process for choosing and enrolling in a Part D plan?
Four easy steps to compare and enroll in a Medicare Part D drug plan
1. Compare a plan:
- Contact the Senior Health Insurance Information Program at 1-800-259-5300 to have a free drug plan comparison.
- Visit the Medicare website or call 1-800-MEDICARE.
2. Select a plan. Things to ask yourself:
- Does my pharmacy accept this prescription drug plan? Call your pharmacist to verify.
- Does the plan that is the best for me fit into my budget?
- Are all my medications covered by the plans?
- Does the plan have quantity limits or step therapy for any of my medications?
3. Enroll in a plan:
- Call 1-800-633-4227 or 1-800-MEDICARE.
- Call the prescription drug plan. These phone numbers are listed in the current issue of Medicare and You.
- Contact SHIIP at 1-800-259-5300.
4. Utilize the plan:
- The Medicare PDP usually becomes effective the month after you apply.
- A plan membership card will be sent to you from the drug plan. Show this to the pharmacist when you purchase a prescription.
- Each year, everyone in a PDP should have a plan comparison completed between October 15th and December 7th, the annual enrollment period. The new plan will take effect January 1st of the following year.
Do Medicare Advantage Plans offer drug coverage?
In certain Medicare Advantage plans prescription drugs are covered, however, these MA plans are not appropriate for everyone.
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What if I am on a fixed income?
“Extra Help” with Drug Costs
Many people with limited income and resources will be eligible for “extra help” paying for prescription drugs. Extra help is sometimes
referred to as "low-income subsidy." People with the lowest income and resources will not pay premiums or deductibles and have small or
no copayments. Those with slightly higher incomes will have a reduced deductible and pay a little more out of pocket. There is no
coverage gap for people who qualify for the extra help.
To determine if you are eligible for “extra help” with your drug costs, contact the one of the following:
- Call the SSA at 1-800-772-1213 and ask for “Application for Help with Medicare Prescription Drug Plan Costs”
- Call SHIIP at 1-800-259-5300
What is Extra Help?
Individuals with limited income and resources can qualify for extra help to pay
for drug costs under the Medicare prescription drug coverage. People who qualify
will receive help paying for monthly premiums and/or cost sharing. The amount of
extra help depends upon the amount of income and assets.
How do I apply for Low Income Subsidy (LIS)?
Contact the Social Security Administration at 1-800-772-1213, SHIIP at 1-800-259-5300 or the local Council on Aging to apply for low income subsidy.
Who Qualifies for Extra Help?
People with Medicare who also receive full Medicaid benefits, SSI recipients and individuals enrolled in QMB, SLMB, and QI will automatically receive extra help to pay for prescription drug costs through the Medicare prescription drug coverage.
No premium if the individual selects a plan at or below the national benchmark ($31.28 in 2015). If a more expensive plan is chosen, the beneficiary pays the difference.
If your income exceeds these amounts you may still qualify depending on the number of persons in your household.
Extra Help for Low Income Subsidy 2014
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