Medicare prescription drug coverage is available through either stand-alone Medicare Part D prescription drug plans (PDPs) or Medicare Advantage plans that include prescription drug coverage (MAPDs).

Choosing how you receive Medicare drug coverage ultimately depends on your situation and personal preferences - and whether you need only prescription drug coverage or you wish to have prescription drug coverage and additional healthcare coverage.

To help you make a decision, you might want to compare these two types of Medicare plan options based on:

• Coverage
  
  Do you only need drug coverage? Do you already have a Medicare Supplement or other Medical insurance? You cannot use a Medicare Advantage plan with a Medicare Supplement.  If you have healthcare through your employer, you probably do not want to enroll in a PDP or an MAPD (or risk losing your employer coverage).
  
  
• Complexity
  
  If you choose an MAPD, ask whether your drugs, pharmacies, doctors, specialists, hospitals are included in the plan’s coverage or network? If you rely on a certain group of healthcare providers, you may find that they are not included in your plan’s network - and you will need to have approval to go outside of the plan's network - and may pay more for out-of-network services.

• Availability
  
  Is there a Medicare Advantage plan available that includes your location in the plan's Service Area? Most Medicare Advantage plans are found in population-dense areas.   Is a PDP the only drug plan alternative available for you?
  
  
• Cost
  
  Are you healthy and looking to avoid the late-enrollment premium penalty?  If so, you may wish to just join a $0 premium Medicare Advantage plan (if available) that includes drug coverage (MAPD).   If you have chronic health issues, a Medicare Advantage plan’s Maximum out of Pocket (MOOP) limit may help contain your annual medical costs (albeit up to $7,550 in 2022, depending on the plan).
  

More on Medicare plan Coverage:

• A stand-alone Medicare Part D plan (PDP) covers only out-patient prescription drugs.  A Medicare Part D plan will work together with VA or TRICARE coverage, but will not usually work together with employer healthcare plans.
  
  
• A Medicare Advantage plan (MAPD) includes the same Medicare Part D prescription drug coverage as a PDP - and includes, at a minimum, the medically-necessary coverage of Original Medicare Part A (in-patient care) and Medicare Part B (out-patient and physician care) and sometimes includes limited dental, hearing, and vision coverage - plus Medicare Advantage plans may include fitness coverage such as the Silver Sneakers program.  As mentioned, you cannot use a Medicare Advantage plan with a Medicare Supplement.  You probably cannot enroll in an MAPD and still keep your employer health plan.
  

More on Medicare plan Complexity:

• Stand-alone Medicare Part D plans (PDPs) only offer prescription drug coverage and plan members need to ensure that their medications are covered in the plan formulary and local pharmacies are included in a prescription drug plan network (and be aware that preferred network pharmacies will charge less than standard network pharmacies).
  
  
• Medicare Advantage plans are available in two general varieties: Medicare Advantage plans with prescription drug coverage (MAPDs) and Medicare Advantage plans without prescription drug coverage (MAs).
  
  Naturally, a Medicare Advantage plan (MAPD or MA) is much more complicated than a Medicare Part D plan. In a Medicare Advantage plan that includes prescriptions (MAPD), the plan member must also ensure that their prescriptions are covered at their local pharmacies (preferred or standard network pharmacies) - plus MAPD plan members must determine whether their preferred physicians or specialists and hospitals are included or excluded from the Medicare Advantage plan network.  Keep in mind, a Medicare Advantage plan has the right to change the plan's healthcare provider network throughout the plan year dropping primary care physicians (PCPs) and specialists.
  
  If you want a Medicare Advantage plan and you want Medicare prescription drug coverage, you will usually need to join an MAPD.  In most cases, you are not able to join an MA and then add a stand-alone Medicare Part D plan for your prescription drug coverage (unless you join an MA that is a private-fee for service (PFFS) plan or MSA).
  
  Medicare Advantage plans can be further defined by how the private insurance carriers choose to implement the Medicare Part A and Medicare Part B coverage.  Some MAs are PPOs (Preferred Provider Organizations) or HMOs (Health Management Organizations) - and still other MAs are set up as PFFS (Private Fee for Service Organizations).  Medicare Advantage Special Needs Plans (SNPs) require that you have the condition or "need" for which the plan is designed (for instance, a specific chronic condition (like Kidney Failure) or financial status).
  

More on Medicare plan Availability:

• To enroll into a Medicare Part D prescription drug plan, you must have either Medicare Part A and/or Medicare Part B. Medicare Part D premiums are in addition to your Medicare Part A (if any) and/or Part B premiums.
  
  There are no health-related questions when applying for Medicare Part D coverage (that is, pre-existing health problems are not considered for enrollment).
  
  You must live in the Medicare Part D plan's Service Area (usually a single state or a group of states).  You can see all Medicare Part D plans in your area by using our PDP Finder: PDP-Finder.com.
  
  
• To enroll into a Medicare Advantage plan, you must have both Medicare Parts A and B. The Medicare Advantage Plans are operated by private insurance carrier and compensated by the federal government. Medicare Advantage premiums are also in addition to your Medicare A and Medicare Part B premiums.
  
  For 2020 and before: The only health-related question asked when applying for a Medicare Advantage plan is whether you suffer from End-Stage Renal Disease (ESRD or Kidney Failure) - plus if you join a Medicare Advantage Special Needs Plan (SNP), you must have the condition or "need" for which the plan is designed.  Other pre-existing health problems are not considered for enrollment into a Medicare Advantage plan.
  
  For 2021 and beyond:  The 21st Century Cures Act amended the Social Security Act allowing all Medicare-eligible individuals with ESRD to enroll in Medicare Advantage plans beginning January 1, 2021.  And the ESRD question was removed from Medicare Advantage plan enrollment applications.
  
  You must also live in the Medicare Advantage plan's Service Area (usually a county, partial county, or ZIP Code region).  You can view all of the Medicare Advantage plans in your area using our Medicare Advantage Plan Finder (or MA-Finder.com).
  

More on Medicare plan Cost:

• Medicare Part D plans charge a monthly premium that ranges from around $5 to well over $200.  Members will pay a cost-sharing rate for their medications (co-payment or co-insurance) until reaching a certain level (the Initial Coverage Limit or ICL), then enter the Donut Hole or Coverage Gap, receive the Donut Hole Discount, and members can ultimately spend their way into Catastrophic Coverage when plan members pay about 5% for their medications for the remainder of the year.  In 2022, if your monthly retail drug costs are over $370 you will enter the Donut Hole and if they are over $891, you will enter Catastrophic Coverage.
  
  
• Medicare Advantage plans with drug coverage (MAPDs) can range in premiums from $0 to hundreds of dollars.  Some Medicare Advantage plans not only have a $0 premium, but you actually get a portion of your Medicare Part B premium "rebated" or paid-back to you.
  
  Medicare Part D prescription drug coverage provided by a Medicare Advantage plan follows the same Medicare Part D drug plan phases as described above, but may offer lower plan limits: Members will pay a cost-sharing rate for their medications until reaching a certain level, then enter the Donut Hole or Coverage Gap, receive the Donut Hole Discount, and can ultimately spend their way into Catastrophic Coverage where plan members will pay a maximum of around 5% for their medications for the remainder of the year.
  
  Limiting your annual healthcare costs:  MOOP
  One of the biggest benefits of a Medicare Advantage plan is that there is a limit to your out-of-pocket medical spending each year.  If you have Original Medicare Part A and Medicare Part B, there is no limit or cap to what you can pay each year, if you have very high medical expenses, you could have very high costs.
  
  However, with your Maximum out-of-pocket limit (or MOOP), your private Medicare Advantage plan will limit your potential Medicare spending each year to some level such as $3,450, $5,000, $6,700, or $7,550 - depending on your chosen plan.  Note, the statutory maximum MOOP increased in 2021 to $7,550 - although many Medicare Advantage plans still offer a much lower out-of-pocket spending limit.
  

For more information, please see:

"What is the difference between a Medicare Advantage plan and a stand-alone Medicare Part D plan?": https://Q1FAQ.com/647.html

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