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MEDICARE PART D
Medicare Part D: Prescription Drug Plan
Medicare Part D is the program that covers drugs prescribed by a doctor. This does not include over-the-counter drugs that you can buy without a prescription.
If you are new to Medicare, you should consider your options for Medicare prescription drug coverage. You may sign up when you first become eligible for Medicare. If you do not sign up when you are first eligible, you may pay a penalty. To learn how these plans work, go to the link below.
How Does It Work?
Your decision about Medicare prescription drug coverage depends on the kind of health care coverage you have now. There are two ways to get Medicare prescription drug coverage. You can join a Medicare prescription drug plan, or; you can join a Medicare Advantage Plan or other Medicare Health Plan that offers drug coverage. Whatever plan you choose, Medicare drug coverage will help you by covering brand name and generic drugs at pharmacies that are convenient for you.
Part D: Premiums, Deductibles, Co-Pays, and ‘The Donut Hole.’
Like other insurance, you will pay a monthly premium. It is currently about $32 a month on average, but this will vary depending on where you live and which plan you choose. There is also a yearly deductible. In 2007 it is $265 for most people. There is also a co-payment each time you get a prescription. If you have limited income and resources, and you qualify for extra help, you may not have to pay a premium or deductible.
After you pay your annual deductible, the amount Medicare pays depends on how much you are spending for your prescriptions. Medicare pays 75% of the first $2,400. For anything between $2,400 and $5,450, Medicare pays nothing. For anything beyond $5,450, Medicare pays 95%. Refer to the chart below:
First $2,400 |
Next $2,401-$5,450 |
Anything Over $5,450 |
|
You Pay |
25% |
100% |
5% |
Medicare Pays |
75% |
0% |
95% |
As you can see, there is a no coverage for amounts between $2,401 and $5,450. This is the so-called 'donut hole' in coverage. Refer to the example below to see how much you would have to pay if your annual drug costs are $10,000.
EXAMPLE |
|||
If Total is $10,000 |
You Pay |
||
First $2,400 |
$600.00 |
||
Next $3,050 |
$3,050.00 |
||
Next $4,550 |
$227.50 |
||
Total You Pay |
$3,877.50 |
+ $265 Deductible |
+ Co-Pays |
In the example above, you would have to pay over $4,000 a year. Most of this is made up of the part that is not covered. This is the so-called ‘donut hole.’ While there is help available for people who have limited incomes and assets, many people choose to carry private supplemental insurance to cover these costs (especially if your annual drug costs are expected to be more than $2,400).
What Drug Plan Is Best For Me?
There are quite a number of different plans under Part D that provide different levels of coverage for different drugs. Currently there are over 1,800 plans nationwide. It can be quite confusing trying to figure what plan is best for you. Medicare has a number of free booklets that can help. Download these by clicking English or Spanish below.
- Medicare Prescription Drug Coverage: How to Join
- Cobertura de Medicare para Recetas Médicas: Cómo Inscribirse
- Your Guide to Medicare Prescription Drug Coverage
- Su guía sobre la Cobertura de Recetas Médicas de Medicare
- What Drugs Do Medicare Drug Plans Cover?
- ¿Qué medicamentos cubren los planes de Medicare de recetas médicas?
Medicare Prescription Drug Plan Finder
The Medicare site also lets you find and compare drug plans, view your current drug plan, and enroll in a drug plan. For more information, click the link below.
State by State Information
Drug plans vary by state, so the Medicare web site also has booklets for each plan that is available in each state. To download the information for a specific type of plan in your state, click the links below.
- Medicare's Landscape of Local Plans State-by-State Breakdown
- Medicare & You State-by-State Information
You can also download a chart that lists Plan D premiums by state for 2007. You can access this at the link below.
Changing Drug Plans
If you currently have Medicare prescription drug coverage, you should review your coverage each year (before the December 31 cut-off). You might want to switch plans if another one better meets your needs, especially if your needs change.
Generally, you can only switch plans between November 15 and December 31 of each year. However, you may be able to change plans at other times. For example, if you:
- Move out of the service area of the plan you are in.
- Have both Medicare & Medicaid.
- Live in, or move into or out of an institution (like a nursing home).
- Have prescription drug coverage from a union or employer, and that coverage ends.
All Medicare Drug Coverage Booklets
You can go to the Medicare web site that provides all the free booklet downloads on prescription drug coverage. You can access this at the link below.
For more general Medicare information, click English or Spanish to get access to free booklets.
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