Part D Prescription Plans
- Medicare Part D Drug plan is optional and is offered by private insurance companies. Monthly costs vary widely by plan and each plan has it’s own covered drug list or formulary. There will be a “network” of pharmacies and the costs per prescription may vary depending upon the pharmacy you use.
- There are two ways to obtain a Part D prescription drug plan. The first is through a stand-alone plan. And second, is through a Medicare Advantage Plan that includes prescription drug coverage.
- For a stand-alone plan, you must have Medicare Part A and/or have Medicare Part B. To obtain a Medicare Advantage Plan, you must have both Parts A & B.
- You must live in the plan’s service area meaning these are based on the county in which you live. They each may have a monthly premium, a deductible, and copays or coinsurance for each drug tier. All the covered drugs within the formulary are grouped into tiers, Tier 1 through Tier 5. Some plans do offer a mail order service which may provide some cost savings.
- Each plan may require what is called Step Therapy, having you try a lower cost drug before they will cover a brand name drug. Also, some medications will have Quantity Limits as well as there may be Prior Authorization required for approval.
- These plans function on a calendar year beginning January 1st and ending December 31st. There are 4 stages to every drug plan. These stages are named the Annual Deductible Stage, the Initial Coverage Stage, the Coverage Gap or Donut Hole and finally the Catastrophic stage. Medicare changes the amounts for each stage on an annual basis.
- Please note, you are not required to obtain a Prescription Part D plan, but if you delay enrollment, Medicare will access a 1% penalty for every month you go without a plan.