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Medicare Part D Glossary

(CMS) Centers for Medicare and Medicaid Services
The federal agency overseeing both the Medicare and Medicaid programs. They were made responsible for carrying out the legislation that put the Part D insurance plans into existence and overseeing how all of the plans conduct business.

Termination of a policy before its normal expiration date.

A person who helps care for someone who is ill, disabled or aged. Some caregivers are relatives or friends who volunteer their help. Some people provide caregiving services for a fee.

catastrophic coverage
This is the last portion of coverage in a Part D plan in which the plan pays almost the entire drug expense for the remainder of the calendar year. The portion that the beneficiary pays during this step is a very small amount of the drug expenses (approximately five percent).

catastrophic limit
The catastrophic limit is the highest amount of money you’ll have to pay out of your own pocket in a year for certain covered prescription drug charges.

certificate of insurance
The printed description of the benefits and coverage provisions forming the contract between the carrier and the customer. Discloses what is covered, what is not, and insurance limits.

chronic condition
Prolonged conditions or illness, such as heart disease, asthma, diabetes.

A request by an beneficiary (or their provider) to the insurance company for the insurance company to pay for services obtained from a health care professional.

The portion of cost belonging to the beneficiary after costs are split on a percentage basis. In a 20/80 plan, the beneficiary would pay 20%.

coinsurance out-of-pocket maximum
After this maximum is met, the plan pays 100% of covered expenses.

copayment or copay
When the beneficiary pays a pre-determined, flat amount for each service. A doctor's visit copay is often ten or fifteen dollars.

A Federal law that gives the right to pay for continued group health care coverage for a specified period if the person loses coverage because of reduced work hours or leaving or loss of a job.

coordination of benefits
This occurs when the insured is covered under more than one plan (for example under a group plan at work, and as a family member on a spouse's plan) the benefits from the plans are coordinated so as to limit the total benefits from all plans. Usually, the benefits from all plans will not exceed 100% of the covered medical expenses.

cost sharing
The way in which insurance plans share their costs. Examples of cost sharing are co-insurance and co-payments.

The benefits package received from an individual insurance plan. Under Part D, prescription drug costs paid by the insurer are the benefits package, also known as coverage.

coverage gap
The gap in your coverage that spans between ordinary drug coverage and catastrophic drug coverage. In this gap, the Medicare beneficiary pays 100% of their prescription costs. According to the federal government, about 88% of Medicare beneficiaries who enrolled in a Medicare Part D plan do not have Donut Hole (or doughnut hole) coverage. The standard or model Part D coverage begins with a deductible of $545 followed by a co-pay of 25% on the next $4485 (you pay $1121.25). Upon reaching the total medication costs of $5030 (with $1666.25 out of pocket), coverage ceases and the beneficiary is 100% responsible for all costs during a "blackout period" known as the "Donut Hole" or "Coverage Gap", until a new spending tier, an additional $6333.75 out of pocket, is reached and coverage kicks in again at the "Catastrophic" level. See Doughnut (Donut) Hole.

creditable coverage
A plan other than a Part D plan that offers Prescription drug coverage and which meets certain Medicare standards.

Tips & Disclaimers
  • Q1Medicare®, Q1Rx®, and Q1Group® are registered Service Marks of Q1Group LLC and may not be used in any advertising, publicity, or for commercial purposes without the express authorization of Q1Group.
  • The Medicare Advantage and Medicare Part D prescription drug plan data on our site comes directly from Medicare and is subject to change.
  • Medicare has neither reviewed nor endorsed the information on our site.
  • We provide our Q1Medicare.com site for educational purposes and strive to present unbiased and accurate information. However, Q1Medicare is not intended as a substitute for your lawyer, doctor, healthcare provider, financial advisor, or pharmacist. For more information on your Medicare coverage, please be sure to seek legal, medical, pharmaceutical, or financial advice from a licensed professional or telephone Medicare at 1-800-633-4227.
  • We are an independent education, research, and technology company. We are not affiliated with any Medicare plan, plan carrier, healthcare provider, or insurance company. We are not compensated for Medicare plan enrollments. We do not sell leads or share your personal information.
  • Benefits, formulary, pharmacy network, provider network, premium and/or co-payments/co-insurance may change on January 1 of each year. Our PDPCompare.com and MACompare.com provide highlights of annual plan benefit changes.
  • The benefit information provided is a brief summary, not a complete description of benefits. For more information contact the plan.
  • Limitations, copayments, and restrictions may apply.
  • We make every effort to show all available Medicare Part D or Medicare Advantage plans in your service area. However, since our data is provided by Medicare, it is possible that this may not be a complete listing of plans available in your service area. For a complete listing please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov.
    Statement required by Medicare:
    "We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options."
  • When enrolling in a Medicare Advantage plan, you must continue to pay your Medicare Part B premium.
  • Medicare beneficiaries with higher incomes may be required to pay both a Medicare Part B and Medicare Part D Income Related Monthly Adjustment Amount (IRMAA). Read more on IRMAA.
  • Medicare Advantage plans that include prescription drug coverage (MAPDs) are considered Medicare Part D plans and members with higher incomes may be subject to the Medicare Part D Income Related Monthly Adjustment Amount (IRMAA), just as members in stand-alone Part D plans. In certain situations, you can appeal IRMAA.
  • You must be enrolled in both Medicare Part A and Part B to enroll in a Medicare Advantage plan. Members may enroll in a Medicare Advantage plan only during specific times of the year. Contact the Medicare plan for more information.
  • If you are enrolled in a Medicare plan with Part D prescription drug coverage, you may be eligible for financial Extra Help to assist with the payment of your prescription drug premiums and drug purchases. To see if you qualify for Extra Help, call: 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/ 7 days a week or consult www.medicare.gov; the Social Security Office at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY users should call, 1-800-325-0778; or your state Medicaid Office.
  • Medicare evaluates plans based on a 5-Star rating system. Star Ratings are calculated each year and may change from one year to the next.
  • A Medicare Advantage Private Fee-for-Service plan (PFFS) is not a Medicare supplement plan. Providers who do not contract with the plan are not required to see you except in an emergency.
  • Disclaimer for Institutional Special Needs Plan (SNP): This plan is available to anyone with Medicare who meets the Skilled Nursing Facility (SNF) level of care and resides in a nursing home.
  • Disclaimer for Dual Eligible (Medicare/Medicaid) Special Needs Plan (SNP): This plan is available to anyone who has both Medical Assistance from the State and Medicare. Premiums, co-pays, co-insurance, and deductibles may vary based on the level of Extra Help you receive. Please contact the plan for further details.
  • Disclaimer for Chronic Condition Special Needs Plan (SNP): This plan is available to anyone with Medicare who has been diagnosed with the plan specific Chronic Condition.
  • Medicare MSA Plans combine a high deductible Medicare Advantage Plan and a trust or custodial savings account (as defined and/or approved by the IRS). The plan deposits money from Medicare into the account. You can use this money to pay for your health care costs, but only Medicare-covered expenses count toward your deductible. The amount deposited is usually less than your deductible amount, so you generally have to pay out-of-pocket before your coverage begins.
  • Medicare MSA Plans do not cover prescription drugs. If you join a Medicare MSA Plan, you can also join any separate (stand-alone) Medicare Part D prescription drug plan
  • There are additional restrictions to join an MSA plan, and enrollment is generally for a full calendar year unless you meet certain exceptions. Those who disenroll during the calendar year will owe a portion of the account deposit back to the plan. Contact the plan provider for additional information.
  • Medicare beneficiaries may enroll through the CMS Medicare Online Enrollment Center located at www.medicare.gov.
  • Medicare beneficiaries can file a complaint with the Centers for Medicare & Medicaid Services by calling 1-800-MEDICARE 24 hours a day/7 days or using the medicare.gov site. Beneficiaries can appoint a representative by submitting CMS Form-1696.