For additional information on aspects of the new Medicare Part D Prescription Plan, please also see:
What is the new Medicare Prescription Coverage (Part D)?
Not all of us will need prescription drugs but, as we age, most of us will. Medicines can be expensive. You may want to give yourself the peace of mind of planning ahead to be sure your drug costs are covered, whether through the Medicare plan or another method.
As of January 1, 2006, Medicare has changed the way it handles coverage of prescription drugs. For the first time, Medicare will pay part (or, in some cases, almost all) of its members’ prescription drug costs. You’ll need to decide if the Medicare plan is right for you and/or whether you would like to cover your prescription drug costs in another way.
Any changes can cause confusion. Part D is no exception. In this section, we hope to help you understand how the new Medicare prescription drug program works, how to decide if you need it, how to pick the policy that’s right for you, where to sign up, and how to seek help if you need it.
For a clear explanation of what is changing and how you may be affected, please review Coverage Changes with Medicare Plan D.
Request a free quote from Health Insurance Carriers offering Part D supplementary coverage in your area >>
At its most basic, the Medicare drug policy is an insurance policy. It is handled through private insurance companies that are approved by Medicare. As a consumer, you pay a certain amount each month (your premium) in order to receive coverage of a portion of whatever prescription drugs you may need. The Medicare drug policy covers both generic and name-brand prescriptions (up to an approved amount). It works through your local pharmacies. Everyone with Medicare is eligible. You will not be denied coverage due to high drug costs, to poor health or to an inability to pay.
The Medicare drug policy is optional. You are not required to sign up. There are, however, incentives to encourage you to join. If you do sign up by May 15, 2006, your costs will be lower than if you wait. The cost of your coverage will go up for each month you delay (after you become eligible). Those who sign up after May 15 will also have to wait until November for another chance to start coverage.
Your decision on whether to sign up for the Medicare drug policy depends on what type, if any, coverage you already have. If your employer or union already offers you prescription drug coverage, you may not need the Medicare plan.
There are two ways to get Medicare drug coverage. One is through the Original Medicare Plan (Parts A and B) with an added Prescription Drug policy (Part D). The other is to get coverage through your Medicare Advantage Plan or other Medicare Health Plans.
Some Medicare Advantage or other Medicare Health Plans pay a portion or all of your drug costs. Joining these plans might save you money. Your costs will depend on the amount of coverage you choose (more coverage usually requires a higher premium) and the amount you pay for each prescription (copayment).
The standard Medicare coverage for 2006 has an estimated monthly premium of $37. The yearly deductible is $250. Once you’ve reached your deductible, Medicare pays 75% of drug costs up to $2,250. Medicare pays 0% of costs above $2,250 until you’ve spent a total of $3,600. Once you’ve spent $3,600 in one year, Medicare pays 95% of all other drug costs.
If your resources or income are limited, you may not have to pay a premium for your coverage. Please see Help for People with Limited Income and Resources for additional details. Also review information on additional prescription supplements for details on Medicare Prescription options outside of Part D.
It’s important to note that Medicare Part D is different from the Medicare-approved drug discount cards that were available in 2004 through 2005.
Request a free quote from Health Insurance Carriers offering Part D supplementary coverage in your area >>
