How Does Medicare Part D Prescription Drug Coverage Work?
Original Medicare covers a wide range of medical services; however, it won’t help pay for most prescription drugs. On the positive side, Medicare offers beneficiaries two ways to get Part D prescription coverage. These include stand-alone Part D plans and coverage bundled in a Medicare Advantage plan. Find out how Medicare Part D works and why you probably need it.
Why Do You Need Prescription Coverage With Medicare?
Original Medicare Part A and B only cover medication in very specific circumstances. For instance:
- Medicare Part A generally only covers drugs received as an inpatient in a hospital, hospice, or another covered facility.
- Similarly, Medicare Part B typically covers the kinds of medications that a professional needs to administer and not the type of drugs patients get from a pharmacy to take home.
Since supplements mostly fill in the gaps for the kinds of services that Original Medicare covers, Medicare supplement owners will also need to purchase a stand-alone Part D Plan. Thus, Medicare beneficiaries who rely on Original Medicare or a Medigap plan need drug benefits to help pay for prescriptions from pharmacies.
Some people may have creditable prescription benefits from a union, workplace, or retirement plan, and they can keep using them. Creditable refers to plans that meet Medicare standards. At the same time, most Medicare beneficiaries need Part D. People who don’t have a drug plan when they first qualify for Medicare might also have to pay a penalty for signing up late.
How Do Medicare Part D Plans Work?
Medicare offers two ways to get Part D Benefits:
- Stand-alone Part D plans: Beneficiaries with Original Medicare, even if they also have a supplement, can buy a stand-alone Part D plan. Like Medicare supplements, private insurers offer them. Though many Medicare supplement companies have Part D plans, beneficiaries are free to choose a plan from another company.
- Medicare Advantage With Prescription Coverage: These days, most Medicare Advantage plans come bundled with drug benefits, so beneficiaries don’t need to buy another plan.
Part D Plans Have Network and Formularies
In order to understand how Part D works, you will need to know about networks and formularies.
Part D Networks
Like many Medicare Advantage plans, many Part D plans use networks to help control costs. That means some pharmacies might not accept all plans, or if they do, they will charge more than network pharmacies. Make certain the plan provides access to convenient and preferred network pharmacies.
Also important, these plans have formularies, which are lists of covered drugs. Medicare requires all formularies to cover certain kinds of medications; however, that won’t guarantee they include any specific one. They might also have multiple tiers of coverage, such as for brand names, generics, and specialty drugs. The portion of the cost you may need to pay will depend upon the drug’s tier.
What Drugs Doesn’t Part D Cover?
Finally, Part D generally doesn’t cover over-the-counter drugs, nutritional supplements, and cosmetic medication. At the same time, most Medicare Advantage plan and Medicare supplements come with membership programs that have discount programs that can help defray these expenses.
Find the Right Part D Plan for Your Needs
When it comes to Part D plans, most Medicare beneficiaries have plenty of choices. At the same time, you might struggle on your own to find the one that serves you the best. Contact us today to schedule your free consultation. We’ve got experience finding the right Medicare plans for each of our clients.