Medicare Part D plans help cover your costs for prescription drugs. Part D plans are available through private companies, and you must actively enroll. Even if you currently don't spend a lot of money on medications, choosing to enroll in a Medicare Part D plan now can help protect you from high drug costs in the future. And, if you don't enroll when you are first eligible, you may pay a penalty fee if you enroll later.
When can I enroll?
- You can enroll in a Medicare Advantage plan that includes Part D coverage.
- Or, you can enroll in a standalone Medicare prescription drug plan (PDP), if you want drug coverage along with Original Medicare.
If you aren't already enrolled in a Part D plan and suddenly need drug coverage, you can't start coverage until your next enrollment period (usually next October)-which could mean you have no coverage for a lengthy period of time!
What’s covered by Part D plans?
- Commonly used brand name and generic drugs
- Drugs that are covered can vary from plan to plan
- Some plans offer more drugs than others
Typically, Part D plans don't cover over-the-counter medications.
What do Part D plans cost?
- Depends on the way you receive the benefit
- May include an annual deductible and co-insurance or copayments
- Most PDPs also have a monthly premium you pay for the coverage, in addition to your Part B premium
- Medicare Advantage plans also require a premium that may include the cost of Medicare Part D
Is financial help available?
If you are getting Social Security benefits, the Part B premium is taken out of your monthly Social Security payment. If you don't get full Social Security benefits yet, Medicare will send you a bill for your Part B premium every three months. If you don't get your bill by the 10th of the month, call Social Security anytime, 24 hours a day at 1-800-772-1213 (TTY: 1-800-325-0778).
What is the “donut hole”?
Most Medicare drug plans have a coverage gap, also called the “donut hole.” After you and the plan spend a certain amount on covered drugs, you pay:
- No more than 25% of the plan's costs for brand drugs, and...
- 37% of the plan's costs for generic drugs, until...
- Your yearly out-of-pocket drug costs reach $3,820
- Medicare Advantage plans also require a premium that may include the cost of Medicare Part D
These savings in the coverage gap increase each year through 2020.
Once you reach your plan's out-of-pocket limit, you automatically get "catastrophic coverage", which ensures that once you have spent up to your plan's out-of-pocket limit for covered drugs, you only pay a small co-insurance amount or copayment for covered drugs the rest of the year.
For more information, download the free publication "Closing the Coverage Gap" from medicare.gov.