Medicare is a federal health insurance program that is available for Americans aged 65 and older, or people under 65 who have disability or end-stage renal disease. There are several different components to Medicare Plans. Parts A and B are part of Original Medicare insurance. Part C is for those on a Medicare Advantage Plan which already includes prescription drug coverage. Medicare Part D only covers prescriptions drugs and is considered supplemental from the Original plan. This means that you need to add the drug coverage to your existing healthcare insurance.
Part D Coverage
There are different Medicare Part D prescription drug plans to choose from. On the Medicare Plan Finder website, you can find customized plan options available in your state. Each state has different regulations, so the costs and plans may differ slightly. It is best to enter information about where you live and your current medications to get the most accurate results. Once you do, the site will list your prescription insurance choices and how much each plan costs. You can also modify the search if you want a plan with a deductible or monthly premium within a specified range.
Medicare recommends that you choose your Part D plan based on the prescription drugs you are currently taking. Each medication is assigned to a tier. A drug in a higher tier costs more than one in a lower tier, and will therefore cost you more. If you’re interested in finding ways to save money, speak to your doctor. Ask if he or she can recommend a different drug that has similar intended effects as your current medication, but is in a lower tier. There may be a generic form that is less expensive as well.
Your monthly Part D premium is different from your Original Medicare premium. The Medicare Advantage Plan and Medicare Cost Plan both include prescription drug coverage, and you will not have a separate fee.
Based the information you put into the Medicare Plan Finder, the website will generate the costs for different Part D plans available to you. Your monthly premiums will vary slightly, depending upon the plan you choose.
Your premium is also calculated based on your two most recent income tax returns. If you are like most people and had an annual income in 2013 of $85,00 or less, or a joint income of $170,000 or less, then you just pay your selected plan’s premium. If you are in the highest income bracket, you pay $70.80 plus your plan premium.
Keep in mind that missing the your initial enrollment period for purchasing Part D can result in penalty fees. The additional costs will be added to your premium if you have 63 or more consecutive days without Part D or any other “creditable” prescription drug insurance. Acceptable drug coverage providers include those from your former or current employer, TRICARE, the Indian Health Service, or the Department of Veterans Affairs. The fee is calculated as such:
1% of the national base beneficiary premium
number of full months without Part D or any other prescription drug insurance
This fee will never go away. As long as you have Part D, you will continue to pay these additional costs each month. The only exception is if you have a Part D plan before the age of 65. Once you turn 65, the fee is erased. You can also appeal the fee by filing out a “reconsideration request form”.
Purchasing Part D Insurance
You are eligible to purchase Part D insurance near your 65th birthday. This means that you have a seven-month window. The time period includes the three months before your birthday, your birthday month, and the three months after that. For example, if your birthday is in July, then you have April through October to enroll.
If you are under 65 but are on disability, then you are eligible to enroll in Part D insurance during a seven-month period which starts three months prior to your 25th month of Social Security or Railroad Retirement Benefits and ends three months after your 25th month.
You can make changes to your Part D coverage during the annual enrollment period.
Using your Medicare Part D Insurance
After you have completed your Part D application, it will take approximately two weeks to process. You will then receive a letter in the mail verifying the receipt of your application. After five weeks, you will get a welcome package in the mail with your new Medicare Part D card.
Should you need to pick up a prescription at the pharmacy before receiving your welcome package, you will still be covered. The pharmacy should accept one of the following as proof of your insurance coverage: the confirmation letter, the enrollment certification number you received when you signed up for a plan, or a printed copy of your temporary card. The temporary card can be accessed through your account at MyMedicare.gov.
If you still have issues, your pharmacist should also be able to verify your account with the last four digits of your social security number of your Medicare number. Otherwise, pay the out-of-pocket costs for the medication, save your receipts, and try to submit them later for a refund.
Combining with Other Insurance
Many individuals have additional insurance which may already include prescription drug coverage. Consider the following information in order to determine whether or not you still need to purchase Part D.
Employer/Union Health Insurance
Each year, your employer or union (or spouse’s employer or union) will send you a letter certifying that your current prescription drug coverage is creditable. Keep this letter for your records. Should you ever need to enroll in Part D, you will want to be able to prove the creditability of your previous prescription insurance so that you don’t have to pay the monthly fine.
If you want to supplement your employer/union prescription insurance with Part D, make sure to check with your employer first. Sometimes, employers will not allow you to have a second plan.
Once your COBRA insurance ends, you will be allowed to purchase Part D during a special enrollment period. If you apply during this period, you will not have to pay any late penalties.
Medicare Supplement Insurance, or Medigap, policies have changed. New Medigap coverage does not include prescription drug coverage. If you already have Medigap, you are allowed to keep the prescription drug coverage. However, Medicare recommends that you buy Part D because the Medigap drug coverage is not creditable.
If you already have Medicaid when you become eligible for Medicare, you can be enrolled in both. You will still have to purchase Part D to have prescription drug coverage. However, you will qualify for “Extra Help”, which is a program for individuals with limited incomes that need additional financial assistance.
For more information, contact the Medicare Part D hotline at 1-800-MEDICARE, or 1-800-633-4227. You can also visit the Medicare website at www.medicare.gov.
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