Medicare prescription drug coverage is insurance for your out-patient prescription drugs and you use your drug coverage like any other types of insurance:
(1) Monthly premiums
You usually pay a monthly premium for drug plan coverage from around $12 to
$190 (unless you enroll in a Medicare Advantage plan that has drug
coverage) and charges a $0 premium).
(2) Initial Deductible
You may pay an initial deductible where you are 100% responsible for
your drug costs before you and your drug plan begin to share the cost
of drug coverage (although some drug plans have a $0 deductible and some
drug plans that has an initial deductible will exclude low-costing generics
from the deductible), and
(3) Sharing the cost of coverage (Cost-Sharing)
Once you are through your deductible (if any), you and your insurance share a portion
of the coverage costs for formulary drugs (for example, your plan pays
75% of retail drug prices and you pay the 25% balance or you pay a $2
co-pay for your generic drugs).
(4) Coverage limited to drug list (drug formulary)
Your Medicare Part D plan (drug insurance) will not cover all
medications and you need to be sure that you choose a drug plan with a
formulary (drug list) that includes your prescriptions - with the
knowledge that a formulary can change throughout the plan year (usually
substituting newly-released generic drugs for higher-costing brand-name
(5) Eligibility for Medicare drug plans
Medicare prescription drug coverage is available to everyone with
Medicare Part A and/or Medicare Part B coverage - who reside in the
Medicare plan's Service Area (state
, county, or ZIP code).
Question: What are the different ways to get Medicare Part D prescription drug coverage?
Medicare drug plans are provided by private companies that have been
approved by the Centers for Medicare & Medicaid Services (CMS or
Medicare). Your Medicare Part D prescription drug coverage can be provided by:
- A "stand-alone" Medicare Part D prescription drug plan (PDP)
A PDP only provides prescription coverage and usually no additional benefits. You can use our Medicare Part D Plan Finder to review all Medicare Part D plans available in your state: https://PDP-Finder.com.
- A Medicare Advantage plan that includes prescription coverage (MAPD)
An MAPD includes your Medicare Part D prescription drug coverage - plus includes Medicare Part A coverage (for in-patient and hospital care) - plus Medicare Part B
coverage (for out-patient and physician care) - and often other
benefits such as basic dental coverage, optical coverage, hearing aid
coverage, and fitness coverage (maybe even transportation coverage, home
healthcare, and other supplemental benefits) - all for one monthly
premium. Medicare Advantage plans are also called Medicare Part C. You can use our Medicare Advantage Plan Finder tool to see all Medicare Advantage plans available in your county: https://MA-Finder.com.
- Finally, you can also receive prescription drug coverage from other sources such as your Union, Employer Health Plan, TRICARE for Life, or the Veterans Affairs (VA).
If I have employer drug coverage can I also join a Medicare Part D drug plan?
Probably not. Warning:
If you have an employer health plan that includes prescription drug
coverage - and then enroll in a Medicare Part D plan, you risk losing
all of your employer health plan coverage, not just drug coverage. You
can click here
to read more in our Frequently Asked Questions about checking with your
employer health plan administrator before enrolling in a Medicare
prescription drug plan.
Question: If I have drug coverage through the Veterans Affairs (VA) can I join a Medicare Part D plan?
If you have VA coverage (that is, prescription drug coverage
as part of Veterans Affairs benefits), then you may not need Medicare
Part D coverage. However, if you find that the VA does not cover all of
your medication needs, you can also enroll in a Medicare Part D
program. The two programs cannot be used at the same time for the
purchase of a single drug, but actually work together, allowing
coordinated coverage - first under the VA and secondly under your
Medicare Part D plan. Your VA coverage is also considered "creditable
coverage" and should you decide to enroll into such a Medicare Part D
plan after the close of your initial enrollment period, there will be no
penalty for late enrollment. You can click here
to read more in our VA section of Frequently Asked Questions.
Question: Are all Medicare Part D plans about the same and available everywhere?
Medicare Part D coverage will vary plan-to-plan and not all Medicare plans are available in all areas of the country. Remember:
Medicare Part D and Medicare Advantage plans are offered in specific Service Areas, such as multiple-states
, counties, ZIP code areas, or parts of a highly-populated city such as New York or Los Angeles. This means:
If you live in Saint Johns County, Florida, you will not have the same
selection of Medicare plans as your friends who live in Orange County,
California. Our Q1Medicare.com
tools are designed to provide people with an overview of all Medicare plan options in their area or region. For more information on Medicare prescription drug coverage, please call Medicare at 1-800-633-4227.
Question: When can I enroll into a Medicare Part D plan?
Your Initial Enrollment Period -
If you are new to Medicare, you have an Initial Enrollment Period (IEP)
that is a seven (7) month window beginning three (3) months before your month of eligibility, plus
the month of eligibility, and ends three (3) months after your month of eligibility. If you enroll in the three months prior to your month of Medicare
eligibility, your effective date (when your plan coverage begins) is the
1st day of your month of Medicare eligibility. If you enroll into a Medicare Part D plan during your month of
eligibility (such as when you turn 65) or during the three months
following the month of Medicare eligibility, your Medicare Part D plan
will be effective on the 1st day of the month following receipt of your
The annual Open Enrollment Period -
If you are already eligible for Medicare, you can change Medicare plans during the Annual Enrollment Period (AEP).
The Annual Enrollment Period
starts each year on October 15th
and continues through December 7th
with your Medicare Part D plan becoming effective on January 1st
of the new plan year. This time period can also be called the annual
Open Enrollment Period -- which is still referred to as "AEP".
Special Enrollment Periods -
If you are outside of your IEP or AEP, then you will need to use a Special Enrollment Period (SEP)
to change Medicare Part D or Medicare Advantage plans.
An SEP may be granted when you move outside of your plan's Service Area
(move to another state) or move into an assisted living facility or
when you qualify for Extra Help
. If you are entitled to an SEP, your Medicare Part D plan will become effective on 1st day of the month following the receipt of your enrollment
. See our Special Enrollment Period
FAQ for more details and examples of SEPs.
Question: Can you join a Medicare drug plan even though you have outstanding health issues?
There are no medical limitations to joining a Medicare Part D plan and starting 2021
, there are no medical limitations when enrolling in a Medicare Advantage plan that provides prescription drug coverage (MAPD). From 2006 to 2020, Medicare Advantage plans required that the Member did do not suffer from End Stage Renal Disease (ESRD) or (kidney failure).
You can choose and join any Medicare drug plan that works for you and is available in your area.
Question: How much will I pay per month for a drug plan?
You will have to pay a monthly premium like you would for other insurance and premiums can range to $0 (for a MAPD plan) up to over $100 per month. If you qualify for the Medicare Part D financial Extra Help program
(or Low-Income Subsidy) and enroll in a Medicare Part D plan that meets your state's $0 low-income subsidy benchmark
your monthly premium will be $0.
All drug plans must provide coverage that is at least as good as standard Medicare prescription drug coverage. Some plans might offer more coverage and additional drugs for higher monthly premiums.
Am I required to join a Medicare Part D plan?
The Medicare Part D program is voluntary and you are not
required to enroll into a Medicare Part D plan when you first become
eligible for Medicare. However, if you do not have some other form of
creditable prescription drug coverage and then later decide to join a
Part D plan (PDP or MAPD
) you may incur a permanent late-enrollment penalty
that you will pay in addition to your monthly plan premiums.
Question: If I don't join a drug plan when I am first eligible, how is the Late-Enrollment Penalty calculated?
Late-Enrollment Penalties are assessed when you eligible for Medicare
Part D coverage, but are without some form of creditable drug coverage
for more than 63 days. You can click here
to read more in our late-enrollment premium penalty section of
Frequently Asked Questions. Late-enrollment penalties are permanent and
can change (increase) year-to-year. You will pay 1% of the national base Medicare Part D premium
(about $33) for every month that you were without some creditable
prescription drug coverage before you enrolled in a Medicare Part D
plan. So, if you were eligible for Medicare when you were 65 and now you
are 70, you would pay 60 months worth of penalty (5 years * 12) or
about 60% of the annual base premium (so around $33 * .6 = $20 per month
in addition to your monthly Part D plan premium).
Question: Is there financial assistance to help me pay my
Medicare Part D prescription drug costs - and Medicare Part A or
Medicare Part B costs?
The Medicare Part D Extra Help
program is available to help people with limited financial resources
pay for their monthly premiums and drug costs. The Extra Help or
Low-Income Subsidy (LIS) program is based on a Medicare beneficiary’s
income and assets (or financial resources). Most people who qualify for full-extra help will pay no premiums, no
deductibles, and no more than a low-fixed cost for each prescription
(with this amount changing each year). For more information,
please contact your state Medicaid office. Medicare Savings Programs
are also available and, depending on your finances, may help pay
Medicare Part A and/or Medicare Part B premiums, and maybe some Medicare
Part B costs.