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Medicare Part D Enrollment: Everything You Need to Know

 

Medicare has always been notoriously difficult to navigate, and never more so than now. There’s Original Medicare and Medigap Plans, and each plan has a letter name to denote it, yet they don’t always work together or even in order. Medicare Part D is designed to help you with your prescription drug coverage, making it essential for the modern senior. Here’s everything you need to know about Medicare Part D enrollment and how the coverage works.

Original Medicare

Original Medicare is usually presented as having three parts: A, B, and D. However, only Parts A and B are actually Original Medicare. Part A covers your hospital expenses and certain skilled nursing facilities, while Part B functions like traditional insurance in covering doctor’s fees, outpatient services, and certain treatments and medical devices. Unfortunately, neither A nor B function like traditional insurance in that neither covers your prescription drugs. That’s what Medicare Part D is for.

Why You Need Medicare Part D Enrollment

According to recent research, 70% of American adults take at least one prescription medication, and 20% take five or more. Seniors are the most likely to be taking a prescription. According to the AARP, 75% of those over 65 take a prescription medication regularly, and of that group, 80% take two or more.

Even if you’re not currently taking medication, therefore, the chances you’ll need a prescription grow greater with every year. And prices are rising, too. In 2010, prescriptions for those over 65 cost $2.036 per capita for those with only Medicare coverage. In 2015, that cost had gone up to $2,923. Official estimates place the 2020 number at $4,196.

What About My Medigap Plan?

Medigap Plans are offered by private insurers, and each plan is regulated, so coverage is uniform no matter who buys it. Medigap can cover many supplemental issues that Original Medicare misses. These plans help with coinsurance costs, copays, foreign medical treatment, and many other key coverage gaps. But Medigap plans are prohibited from covering your drug costs.

What About a Medicare Advantage Plan?

Medicare Advantage (Part C) is also offered by independent insurance companies, and this plan is designed as a less costly alternative to a Medigap plan while still covering some of the gaps in Original Medicare. These are only available once you’ve enrolled in Medicare Part A and B, which they then replace while also offering you other coverage, including coverage of your prescription drugs.

As such, you cannot have a Medicare Advantage Plan and Medicare Plan D at the same time. If you enroll in Part D, you’ll be automatically dropped from your Medicare Advantage Plan. However, if you choose Medicare Advantage over a Medigap plan, you will need Medicare Part D enrollment.

How Medicare Part D Works

Part D gives you a card and a number, which you then use to access prescriptions at a lower cost. You’ll also pay a copay for most prescriptions. Your final costs will depend on your individual plan. In general, Medicare Part D puts drugs into four categories:

Tier 1

Tier 1 has the lowest copay, and these are very common, inexpensive drugs or generic versions of more costly prescriptions.

Tier 2

Tier 2 demands a slightly higher copay and are usually preferred brand-name drugs—but they are still drugs that insurers can get for a lower price than Tier 3.



Tier 3

Tier 3 are non-preferred brand name drugs and have a higher copay. The insurance company is unable to get much of a price break for drugs in this tier.

Specialty

These are unusual and very high-cost drugs with no generic version available. Your co-insurance fee for these is typically a percentage of the cost rather than a flat fee.

How to Get the Best Deal

List Out Your Regular Medications

Make a list of every medication you take regularly as well as any you’ve taken previously that you’re likely to need again.

Compare Your List to the Plans

As you consider plans by the various insurers, be sure you find out which tier each of your prescriptions falls under. Depending on your unique situation, this could be more of a deciding factor than even deductibles and premiums.

Talk to Your Doctor Before Medicare Part D Enrollment

Doctors aren’t here to save us money: they’re here to save lives. Doctors tend to default to the best possible option or the drugs they’re most familiar with. If you have a Tier 3 drug you take regularly, ask your doctor if there’s a generic version or a Tier 2 alternative that might work as well.

Know the Rules

Every plan is different, so check on each of these issues before you choose one:

Prior Authorization Requirements

Some plans will only cover certain prescriptions if you get prior authorization. They want to ensure the prescription is medically necessary and following all plan rules before they sign off.

Quantity Limits

Some plans have limits to the number of pills you can get at any one time. Your doctor can give you more, but only if they ask for an exception for you as a medical necessity.

Step Therapy

Some plans require that your doctor prescribe the least expensive drug in every case, see how it works, and then “step you up” to the most expensive option only if the cheaper options aren’t working. If this works, both you and the insurance company save money. If it doesn’t, your doctor can give you a more expensive drug.

However, if your doctor believes a cheaper drug will not be good for your health, either in general or because you’ve suffered side effects of similar drugs before, they can ask for an exception in advance.

Know Where to Fill Prescriptions

Like drugs, pharmacies under Medicare Part D are divided into tiers. When you visit a preferred pharmacy, you’ll pay the least copay. If you visit a higher tier pharmacy, you’ll pay a larger copay. Mail prescriptions have the lowest copay.

Learn More

For more about Medicare or Medigap, and to get helpful information and tips for life as a senior, visit For Seniors Magazine today for senior living at its finest.

 

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