Medicare Part D Coverage: Does it Cover My Drugs?
Private insurance plans offer Medicare Part D, a prescription drug program. Medication coverage is also available through Medicare Advantage (Part C) plans.
According to the Kaiser Family Foundation, 70% of eligible Medicare recipients are enrolled in Part D plans, or about 45 million people. The majority of people enrolled in Part D plans (58%) opt for standalone plans.
Only five plans will cover 88 percent of Part D enrollees in 2020. Medicare must approve every private plan that offers Part D.
Find out what Medicare Part D is, what it covers, and how to figure out how much you’ll have to pay in 2022 by reading on.
What is Medicare Part D, and how does it work?
Medicare has several parts, each with its own set of benefits to assist in paying healthcare-related expenses, such as prescription drugs. Parts A and B of Medicare cover prescription drugs, but they don’t cover medications you take at home.
For outpatient needs, Part D provides the most comprehensive prescription medication coverage. Part D covers prescriptions from your local pharmacy, mail-order pharmacies, and other pharmacies.
To join a Part D plan, you must be enrolled in either Medicare Part A or Part B, and different Part D plans offer different levels of coverage.
Your choice of plan will determine your bill. Several factors determine your copays, coinsurance, and deductibles, including where you live, your income, and the medications you take.
What medications does Medicare Part D cover?
Medication coverage varies depending on the plan. A grouping is a list of drugs that all insurance plans cover.
This is a list of all the medications the plan covers. When choosing a plan, please, list the medications you take or check the formulary to make sure medicare covers them.
According to Medicare, all plans must also cover some specific types of medications, and, at least, two medications from the most commonly prescribed drug categories.
All Part D plans must cover the following drug classes:
- Antiretroviral drugs.
- Antidepressants.
- Cancer treatment drugs.
- Immunosuppressive.
- Anticonvulsants.
- Antipsychotics.
Medicare does not cover certain medications, such as those for weight loss or gain, hair loss treatments, fertility medications, over-the-counter medications, and dietary supplements.
Over the last decade, Medicare drug costs have risen steadily. Some of the most popular medications have seen price increases that have outpaced inflation in recent years.
For example, between 2016 and 2017, the price of apixaban (Eliquis), a blood thinner used by over 1 million Medicare beneficiaries, increased by more than 9%.
This is significant because your coinsurance is a percentage of the drug’s list price, so if you take certain medications, your costs may rise year after year, as drug prices increase.
It’s also important to choose a plan that allows you to fill your medications at any pharmacy_if you live in different places throughout the year. Some plans limit you to using only one pharmacy.
What is the Medicare Part D tier system?
There is a tier or step system in every Part D plan formulary. Consider it a pyramid. The least expensive medications are at the bottom of the pyramid, while the most expensive medications are at the top. The majority of plans are divided into four to six tiers.
Because each plan’s tier system differs, it’s important to understand where your medications fall within the tier system of the plan you’re considering. Copays and coinsurance can also vary depending on the tier level.
Is it possible to file an appeal if your medication isn’t covered?
If your medication isn’t covered or if your medication’s coverage is being phased out, you may be able to request an exception from the plan. You can either call the number on your plan’s card or look up a list of people who can help you on Medicare’s website.
Your doctor may have to write you a letter, explaining why you need to take the medication. There are five appeal levels. Make sure to keep records for yourself each time you file an appeal. Include any additional information that the insurance company might find useful in deciding whether or not to cover the medication.
Individual decisions about whether or not to cover medications that aren’t on a plan’s formulary are made.
Is generic medication covered by Medicare Part D?
All Part D plans use the formulary tier system to cover generic and brand-name medications. Most people prefer Tier 1 generics because the plan and copays are usually the most affordable.
Keep in mind that each plan’s tier formulary contains different generics, so double-check if it includes your medications. If a medication isn’t on the formulary, inquire at your pharmacy about the cost of purchasing it without Part D.
In addition, plans can alter the medications available in their tiers. Before enrolling in a Part D plan, make sure your plan still covers the medications you take every year during annual open enrollment.
What is the approximate cost of Medicare Part D?
Deductibles, premiums, coinsurance, and copayments, are some of the out-of-pocket expenses that go into calculating Part D costs.
Aside from these costs, Part D has a premium that you must pay in addition to your original Medicare premiums.
The following factors influence how much you’ll pay for Medicare Part D and prescription drugs:
Deductible.
According to guidelines, the deductible for any Part D plan must not exceed $480 in 2022.
You can choose plans with a $0 deductible based on your medications. Some Part D plans, for example, waive the deductible on tier 1 and 2 medications.
Premiums.
A premium is a monthly fee that you must pay to be enrolled in a particular Part D plan. The average monthly premium rate in
2022 will be around $33.37.
Copays.
A copayment (known as a copay) is the cost of a single prescription drug. The plan you choose and the medications you take determine your copays.
Coinsurance.
The cost of coinsurance is determined by the plan you choose, and the tier your medication is assigned to.
Coinsurance is a percentage of the cost of medication. If your Part D plan requires it, you’ll start paying this fee after you’ve met your deductible.
Donut hole.
The “donut hole” ( also called a coverage gap) in Part D plans affects the amount you pay each year as well.
You’ll be in the donut hole when you spend $4,430 in 2022. Until you reach $7050 in out-of-pocket costs, you’ll have to pay 25% of the cost of your prescription medications while you’re in the gap.
During this time, however, brand-name medications are heavily discounted. Because you qualify for catastrophic coverage, you’ll have to pay a 5% copay for the rest of the time.
Where do you reside?
Individual Part D plans are available, depending on where you live, and costs vary. Different plans are available in different areas, and prices can vary significantly.
Medication costs vary depending on the Part D plan you choose, the tier the drug is in, and whether or not, there’s a generic option.
Your earnings.
If your income exceeds a certain threshold, you’ll have to pay an additional fee to Medicare called a Part D income-related monthly adjustment amount (Part D IRMAA). This fee is in addition to the Part D premium you pay each month. If you must pay the Part D IRMAA, you will be notified.
Who is eligible for Part D of Medicare?
The eligibility requirements for Part D are the same as for original Medicare, and they are as follows:
- Being 65 or older.
- Received Social Security disability benefits for a period of at least 24 months.
- Diagnosed with amyotrophic lateral sclerosis (ALS).
- Diagnosed with end-stage renal disease (ESRD) or kidney failure.
- Having received Social Security disability for at least 24 months.
Depending on your medication needs, you can buy a standalone Part D drug plan or get Part D coverage through Medicare Advantage (Part C) plans.
Open enrollment for Part D plans begins on October 15th and ends on December 7th; You can enroll in a new Part D plan or switch from your current plan to a new one; once a year during this period.
You can change your Medicare Advantage plan to include Part D coverage from January 1st to March 31st of each year. During this period, you can also switch from an Advantage plan to a traditional Medicare plan.
Assistance with the cost of your prescription medications.
If you have a Medigap plan to cover some of your out-of-pocket costs, you can save money on original Medicare.
Comparing the costs of Part D with Medigap and a Medicare Advantage plan that includes prescription drug coverage is a good idea, depending on the medications you take. Extra Help is a Medicare program for people with limited resources, or who need assistance paying their Part D costs. If you meet certain income requirements, are on Medicaid, or meet other criteria, you may be eligible.
Some pharmaceutical companies offer discounted medications to people who meet certain criteria. If you’re having trouble affording your prescription medication, contact the manufacturer to see if they offer a payment plan.
Takeaway.
Every year, millions of Americans benefit from Medicare Part D prescription drug coverage, saving them money on their prescription drug costs.
The type of plan you choose determines the cost of your plan, its formulary tiers, other out-of-pocket costs, and premiums.
Compare Advantage plans, Medicare Part D standalone plans, and Medicare Part D with a Medigap plan to find the right plan for you.
Each year, the Medicare plan options and costs are subject to change. Visit our website NewMedicare.com to learn more.
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