Medicare Part D: Prescription Drug Coverage
Medicare Part D helps cover the cost of prescription drugs and is offered through private insurance companies approved by Medicare. Here’s what to know about Part D:
- Formularies: Each Part D plan has a “formulary,” which is the list of prescription drugs that the plan covers. It’s crucial to choose a plan that includes the medications you currently take, as well as any you might need in the future. Different plans can have different tiers of pricing for generic, brand-name, and specialty drugs.
- Costs: You’ll pay a monthly premium for Part D, and it varies depending on the plan and your location. You might also have an annual deductible, copayments, or coinsurance. Plans can change their formularies and pricing each year, so it’s essential to review your plan during the Medicare Annual Enrollment Period to make sure it still meets your needs.
- Coverage Gap (Donut Hole): Part D has a coverage gap known as the “donut hole,” where you may pay a higher percentage of drug costs once you and your plan spend a certain amount on covered drugs. However, since changes were made in recent years, this gap is not as significant as it used to be, and many people still receive some level of discount during this period. Also, the coverage gap is going away in 2025 in an effort to bring down rising prescription costs for those enrolled in Medicare
- Catastrophic Coverage: If your drug costs reach a certain point, catastrophic coverage kicks in. At this stage, you pay nothing for your covered drug costs.