 | Low: $0 |
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 | Average: $30 Per Month |
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 | High: $131 Per Month |
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| Medicare Prescription Drug plans are also called Medicare Part D. Although these plans are approved and regulated by the federal government, they are all designed, operated and sold by private insurance companies.Generally, Part D plans are either purchased in addition to traditional government-run Medicare (Part A and/or Part B) or as part of a Medicare Advantage (Part C) policy from a private insurance company. For an overview of all these options, see How Much Does Medicare Cost. | | |
| Typical costs: | - The two basic expenses for Medicare Part D are the monthly premium and the cost of buying prescription medications under each plan. The specific drugs covered vary from one plan to another, or even from year to year under the same plan, which means premium costs will vary depending on which drugs are covered.
- The average monthly premium for a Medicare Part D Prescription Drug Plan in 2012 is $30, or $360 a year, according to the Centers for Medicare and Medicaid. However, 2012 premiums can cost zero to $131.80 a month and not all plans are offered in all areas. The Kaiser Family Foundation charts the number of prescription drug plans offered in each state, including the low, high and average premiums.
- Each year the government sets the minimum coverage an insurance company is allowed to offer. The 2012 standard benefit includes a $320 deductible, an initial coverage limit of $2,930 and an out-of-pocket threshold of $4,700; the gap between the initial coverage limit and the out-of-pocket threshold is known as the "doughnut hole." The person covered pays the first $320 of drug costs; after this deductible is met the plan pays 75% of the costs up to the initial coverage limit of $2,930. The individual is now in the "doughnut hole" and must pay 50% of the cost of brand-name drugs and 86% for generic drugs until the total value exceeds the out-of-pocket threshold of $4,700. Anything above that amount is considered catastrophic coverage, and the individual pays whichever is higher, either $2.60 -$6.50 per prescription or 5% of the total prescription cost. All Medicare prescription drug coverage must be at least as good as this minimum standard. Some policies lower or eliminate the deductible; others reduce or eliminate the "doughnut hole" coverage gap.
What should be included: | - Medicare drug plans cover both generic and brand name drugs. However, each plan has its own formulary -- a list of prescription medicines covered under the plan. A formulary must meet Medicare's minimum requirements, but does not have to cover all prescription medications. Most formularies do not include medicines not approved by the FDA, fertility drugs or medications for weight loss or gain. The Medicare Formulary Finder searches by zip code or an individual's Medicare information (name, number, etc.) for local plans that cover specific drugs.
Discounts: | - Subsidies are available from Medicare so that low income seniors pay no premiums or deductibles for their Part D Prescription Drug plans; medicare.gov offers a brochure on applying for help paying for prescription drugs. .
Shopping for medicare part d: | - To choose the best Medicare Prescription Drug plan, make a list of all medications taken, how much the individual is currently paying for them and at which pharmacies. Use the Medicare Plan Finder to enter the drug names and search for details on the Part D Prescription Drug plans available locally. The Medicare Rights Center lists questions to consider when choosing a Medicare Part D Prescription Drug Plan.
- The initial open enrollment period for Medicare Part D is the month of the person's 65th birthday, plus three months before and three months after.
- To change Medicare prescription drug plans, the annual open enrollment period is Oct. 15 to Dec. 7.
- If a person is covered under the original government-run Medicare (Part A and Part B), signing up for some Part D prescription drug plans could trigger an automatic switch to a private Medicare Advantage (Part C) plan. Before choosing, ask if a Part D plan works with Medicare Part A and B, or is connected to a Medicare Advantage plan.
- It's not mandatory to take Part D Prescription Drug coverage when first eligible for Medicare. However, if Part D coverage is added later the premiums will be higher unless there is proof that during the period when Part D coverage was waived the individual had other prescription drug coverage (i.e. under a spouse's health insurance) that was at least as good as Medicare Part D.
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Article updated February 2012 |
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