Medicare Part D is prescription drug coverage that helps cover the cost of prescription drugs.
Medicare Part D is only available through private insurance companies that are approved by Medicare.
You can get Medicare prescription drug coverage two ways:
► Medicare Prescription Drug Plan (Part D) – These plans add drug coverage that work alongside of your Original Medicare (Part A and/or B), some Medicare Cost Plans, some Private-Fee-for-Service-Plans, and Medicare Medical Savings Account Plans.
► Medicare Advantage Plan (Part C) – Many Medicare Advantage Plans include prescription drug coverage as part of their benefits, though not all do. These Medicare Advantage plans are known as Medicare Advantage Prescription Drug Plans (MAPD) and you must have both Medicare Part A and Part B to enroll in a Medicare Advantage Plan.
Your monthly plan premium and out-of-pocket costs for prescription drugs will vary from plan to plan since different insurance companies offer different types of plans. All Medicare Prescription Drug Plans have a formulary which is a list of covered drugs. Please note that the formulary may change at any time but, you will receive notice from your plan when necessary.
Medicare Part D also covers certain vaccines that are not already covered under Part B.
Most Medicare Prescription Drug plans charge a monthly premium that varies by plan. You will make the following payments throughout the year:
► Monthly premium (which is in addition to the Part B premium) (certain individuals with higher incomes pay a higher premium).
► Yearly deductible, if there is one.
► Co-payments/coinsurance (these differ according to the plan chosen and are paid after meeting the deductible).
► Costs in the coverage gap (also called the “donut hole”). Donut Hole is when you and your plan have paid a certain dollar amount during the year (a limit) for covered drugs. After you hit this limit, you then pay more out-of-pocket for drugs until you qualify for catastrophic coverage.
► Catastrophic Coverage – you only pay a small coinsurance or co-payment for the remainder of the year. The discount you receive on drugs and amounts you pay count towards the out-of-pocket limit.