If you are planning to enroll in Medicare, then you will need to take the extra step of enrolling in Medicare Part D coverage if you want to receive prescription drug benefits. This separate benefit, offered by private insurers, is the primary source of prescription drug coverage for Medicare patients, and given the high costs of medications today, millions of Medicare recipients can benefit from it.
Like all insurance policies, Part D coverage will have its terms, conditions and cost obligations attached. Before getting coverage, take a closer look at some of these:
· Premiums: Your premium is the cost that you pay for your prescription drug plan itself. You will have to make this payment regularly, and will pay it in addition to your Original Medicare premiums.
· Copayments: Most prescription drugs on Part D plans come with copayments attached. Copayments are nominal costs that you pay for the cost of your prescriptions after your plan pays its share of your costs. Co-payments will vary from plan to plan and prescription to prescription.
· Formularies: Your insurance plan’s formulary is the list of drugs covered by the policy. You must take a prescription within your formulary in order to receive full coverage. Formularies usually offer numerous drugs to treat the same condition.
· Drug Tiers: Within your formulary, you will often find that drugs are separated into tiers. Those in the lowest tiers are usually generic drugs and come at the lowest costs to the consumer. Those in higher tiers might be brand-name or specialty medications, and they usually come at a higher out-of-pocket cost. Keep in mind, just because a drug is in a lower tier does not mean it is weaker or less effective.
· Prior Authorization: In order to have Part D cover certain prescriptions, your physician must submit a prior authorization to your insurer. This prior authorization explains to Medicare that it is medically necessary for you to take that drug in particular. However, don’t forget that though one drug might not be covered, an alternative might still be available on your plan.
· Deductibles: A deductible is a dollar value that you must pay out-of-pocket for your drugs before your plan begins to pay any share of costs. Deductible rules vary from plan to plan. Some drugs are not subject to deductibles, and some plans have no deductible at all. Under Medicare rules, no drug plan deductible can cost more than $445 in 2021.
· Donut Hole: Your Part D donut hole is a gap in coverage that will kick in after you and your plan have paid a combined $4,130 for drugs in 2021. At this time, the pricing structure for drugs will be different than they were when you were not in the coverage gap. However, you will still only pay a percentage of the full cost of the drug in question.
We’re happy to help you choose the plan that will offer you the best cost structure for the drugs that you must take.