What Is Medicare Part D and How Does It Work?
Medicare Part D, also known as the prescription portion of the Parts of Medicare, is a part of the Medicare Modernization Act signed into law in 2003. Beginning 2006 Medicare Part D, a prescription drug benefit was made available to individuals and offered through private insurance companies and HMO's. Part D is voluntary, but comes with a penalty if not purchased.
What is Medicare Part D?
Medicare Part D is the outpatient prescription drug portion of Medicare. Benefits are provided through private insurance companies approved by Medicare and have different levels of plans to choose from. The different choices included in the different plans available are, but are not limited to, different monthly cost, deductible options, different co-pays, different tier options, some plans even offer better out-of-pocket cost if you use a preferred pharmacy. Ultimately, it all depends upon the medication you personally take when choosing the right prescription coverage to meet your needs.
How Do You Get Medicare Part D Coverage?
If you are entitled to Medicare, to obtain a Part D prescription drug plan, you have two options on how to receive this coverage. Your first option would be, if you elect to stay with Original Medicare, you can apply for a standalone Part D plan. In most cases this will allow you to pick and choose from roughly 25-35 different Part D plans in your area. The other option is if you choose to receive your Medicare health insurance benefits through a Medicare Advantage Plan (Medicare Part C), most of these plans will automatically have Part D prescription coverage built into it. Just note that you have to follow the plans specific formulary. So, make sure to check your medications to make sure they are covered. On the other hand, some Medicare Advantage Plans (PFFS or Private Fee For Service) will allow you to only choose the health portion of the coverage and allow you to choose a standalone Part D Plan.
How Do I Pick the Right Medicare Part D Plan?
Simply stated, it is all about the medications you take. Even though each Medicare Part D Plan available must follow the law of Part D, they differ in the since of cost, if it has a deductible, their formulary list, and which pharmacy may be in network or considered preferred.
This means that without help you could be overpaying for your Part D Plan and the overall cost of your medications. This is where enlisting the services of an independent agent can be advantageous. If an independent agent has access to all of the information on all of the plans in your area, they can help narrow down the best plan to meet your needs. You can also go to www.Medicare.gov, they offer the best software, in my opinion, that will allow you to enter in you zip code and the medication you take and they will filter all the Part D Plans available in your area and filter them for the "Best Annual Retail Drug Cost". This will ensure that you do not overpay for your coverage and that all of your medications are covered.
Receiving Extra Help with Medicare Prescription Drug Costs
For individuals that cannot afford their Part D costs, they may qualify for additional help. LIS or Low Income Subsidy can help cover some or most of the cost of your medications, and could also cover the cost of your Part D prescription drug plan. For more information, call your local Social Security office or visit http://www.ssa.gov/prescriptionhelp/
What If I Elect NOT to Take a Medicare Part D Prescription Plan?
Part D prescription drug plans are voluntary, but by not choosing to sign up within 3 months of your Part B effective date or 63 days from losing your Group/Employer Sponsored health plan, can result in penalties and a lockout period. For example, the penalty for not signing up for a Part D Plan within the specific time allowed can result in a 1% penalty of the average Part D premium, compounded by the number of months you do not enroll. Also, as for the lockout period, Medicare has an Annual Election Period every year (October 15th - December 7th), that individuals can either enroll or change their coverage for a January 1st effective date. For example, let's say that your Part B effective date is January 1st of a specific year and you decide not to enroll in a Part D Plan until April of the same year, you will not be able to. You will now have to wait until the Annual Election Period to receive a January 1st effective date of the following year, and penalties will be included.
Part D can be a very confusing Part of Medicare and it is highly recommended to enlist the help of a licensed professional to make sure you have the best coverage. For more information, please contact an agent today at (512) 868-4469 or email us at firstname.lastname@example.org.