Medicare Part D (Drug Coverage)

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Medicare has made prescription drug coverage available to everyone currently on Medicare though their Part D program. Part D drug plans, which are sold by private insurance companies, can vary in cost and by the drugs they cover.

This drug coverage is not included in Original Medicare and is typically available two different ways. Your first option is if you have Original Medicare, typically with an Arkansas Medicare Supplement plan, then you can enroll in a stand alone Part D plan when you are new to Medicare or during another valid enrollment period. The second way you can get drug coverage is built into a Medicare Advantage Plan. 

Prescription drug plans can make changes to their formularies, so it is important to talk with your insurance agent during the Annual Enrollment Period to make sure that your drugs will still be covered next year.

 You are eligible to enroll in an Arkansas Medicare prescription drug plan if you have Part A and/or Part B of Medicare. Enrollment in into Part D plans are limited to certain times when you have a valid enrollment Period. These enrollment Periods include:

1) Initial Enrollment Period: This is a period when you are new to Medicare for the first time and are able to enroll in either a Medicare Advantage or stand alone Part D plan regardless of the time of year. This enrollment period lasts for seven months beginning 3 months prior to the month you turn 65 and continues until 3 months after your birth month.

Example: If you turn 65 on June 15th then your Initial enrollment period would be March 1st – September 30th.

2) Annual Enrollment Period (October 15th – December 7th): Each year during the Annual enrollment Period you will have the opportunity to switch your Medicare advantage or Part D drug plan to any other plan you wish for the coming year. This is also the time to sign up for a drug plan if you have been on Medicare without drug coverage in the past. The coverage you enroll with will begin on January 1st of the following year.

Note: This does not pertain to Medicare Supplement plans as you can that coverage any time of year.

3) Special Election Period: Other then the two previous mention enrollment periods you can only enroll in a Part D drug plan if you qualify for a Special Election Period. The most common examples of situations that would qualify are if you are leaving a group health insurance plan or have moved outside of your current drug plans service area.

1) Premiums: Each company can set the monthly premium they would like to charge for their plan. Premiums range from about $20 up to $100+ per month.

2) Deductibles: You pay the full price of your medications until your deductible has been met for the year and then you will either pay a specified amount or percentage of the cost of the medication.

3) Formulary: This is the list of medications a plan will cover. Although each company is required to cover a certain number and types of medications, each company’s list will vary.

4. Tiers: Most companies place drugs into 4 or 5 different “tiers”. Each tier will have a different cost. Common tiers include preferred generic, generic, preferred name brand, name brand, and specialty.

The late enrollment penalty is an amount that's permanently added to your Medicare drug coverage (Part D) premium. You may owe a late enrollment penalty if at any time after your Initial Enrollment Period is over, there's a period of 63 or more days in a row when you don't have Medicare drug coverage or other creditable prescription drug coverage. You’ll generally have to pay the penalty for as long as you have Medicare drug coverage. 

 The cost of the late enrollment penalty depends on how long you went without Part D or creditable prescription drug coverage.

Medicare calculates the penalty by multiplying 1% of the "national base beneficiary premium" ($33.06 in 2021) times the number of full, uncovered months you didn't have Part D or creditable coverage. The monthly premium is rounded to the nearest $.10 and added to your monthly Part D premium.

The national base beneficiary premium may change each year, so your penalty amount may also change each year.

If you have chosen to stay with Original Medicare, which is most common when you enroll in a Medicare Supplement Plan, then you will have the option to sign up for a stand alone Part D drug plan. 

The benefit of going this route is that you are able to pick your Drug Plan independently from your Medicare supplement plan. For example you could take your Medicare Supplement Plan though "Company A" and your Part D plan though "Company B". 

This allows you to find the Insurance company that offers you the lowest price for your Medicare Supplement Plan and independently select the company that will cover your RX medications for the lowest price available. This flexibility could end up saving you quite a bit of money! 

If you have chosen to take an Arkansas Medicare Advantage plan (Also know as Part C of Medicare), then your prescription drug coverage will typically be built into the plan that you select. Arkansas Medicare advantage plans look and feel very similar to the health insurance you may have had before you joined Medicare, where your hospital, doctor, and drug coverage was all provided by the same company and you only needed to carry one ID card.

Starting January 1, 2021, if you take insulin, you may be able to get Medicare drug coverage that offers savings on your insulin. You could pay no more than $35 for a 30-day supply. Contact us and we can help you find a plan that offers this savings on insulin in your area. You can join during Open Enrollment (October 15 – December 7, 2020). 

If you have limited income and resources, we can see if you qualify for help from the state to pay for your Medicare Part A and/or Part B premiums. You may also for extra help to pay for your Medicare prescription drug coverage. Contact us and we can check this for you.