Part D Prescription Drug Plans
Part D Prescription Drug Plans help with the costs of medications prescribed by your doctor. There are two ways to get Medicare prescription drug coverage–either through adding a Medicare Prescription Drug Plan (Part D), or getting a Medicare Advantage Plan (Part C) that offers Medicare prescription drug coverage. This offers you multiple ways of managing your prescription drug coverage.
Medicare Prescription Drug Plans Have Rules:
- Formulary: Prescription Drug Plans have lists of drugs they will cover, called a formulary. Drugs are placed into different “tiers”…each tier will have a different cost. A drug in a lower tier will cost you less than a drug in a higher tier.
- Prior authorization: You and/or your prescriber must contact the drug plan before you can fill certain prescriptions. Your prescriber may need to show that the drug is medically necessary for the plan to cover it.
- Quantity limits: Limits on how much medication you can get at a time.
- Step therapy: You must try one or more similar, lower cost drugs before the plan will cover the prescribed drug.
If you or your prescriber believe that one of these coverage rules should be waived, you can ask your plan for an exception.
Medicare Part D Late Enrollment Penalty (LEP)
The late enrollment penalty is an amount added to your Medicare Part D monthly premium. You may owe a late enrollment penalty if you go without Part D or creditable prescription drug coverage for any continuous period of 63 days or more after your Initial Enrollment Period is over.
The “Donut Hole”
Medicare Part D contains a “donut hole,” a coverage gap where beneficiaries are required to pay the full cost of their medications, even while they continue to pay premiums. A discount is applied to the full cost of the medications for beneficiaries while they are in the coverage gap.
Closing the Medicare Part D “Donut Hole”
The Affordable Care Act (ACA) included changes to Medicare prescription drug coverage (Part D) such as reducing expenses for seniors in the donut hole now and eliminating the gap altogether by 2020.
Amounts that beneficiaries will pay for their medications until the donut hole is closed in 2020:
2018: 35% for brand-names and 44% for generics.
2019: 30% for brand-names and 37% for generics.
2020: 25% for brand-names and 25% for generics