Medicare is a health insurance program that is available to Americans who are age 65 and over, as well as those who are under age 65 that have qualifying disabilities or end stage renal disease (ESRD).
This program, established in 1965, has four primary components, and it covers expenses for enrollees’ hospitalization, doctors’ services, and prescription drugs. Medicare is administered by the United States federal government.
What Does Medicare Part D Cover?
Medicare Part D plans help to cover the cost of prescription drugs for enrollees. These plans are run by private insurers that are approved by Medicare. Each of the Medicare Part D prescription drug plans has its own list of covered prescription drugs. This list is referred to as a formulary. Many of the Medicare Part D plans will place drugs into different “tiers” on the formulary list, with the drugs in each of the tiers having differing costs.
How Much Does Medicare Part D Cost?
Most prescription drug plans will charge a monthly premium. However, unlike Medicare Part B, the cost of Medicare Part D drug plans do not have one set premium amount for all enrollees. The premium that you will pay for this coverage will be based upon several different factors, including:
The actual Part D plan you have chosen
The prescription drugs that you use
Whether or not your prescriptions are on your Part D plan’s formulary list
The pharmacy that you use
Whether or not you qualify for the Extra Help plan for paying your Medicare Part D expenses
Who Qualifies for Medicare Part D?
Medicare offers Part D prescription drug coverage to everyone that has Medicare. Therefore, if you have Original Medicare coverage (Medicare Parts A and B), or a Medicare Advantage plan (Medicare Part C), you will qualify to also enroll in Medicare Part D. (It is important to note that certain Medicare Advantage plans may already have prescription drug coverage included.)
How Do You Apply for Medicare Part D?
You can apply for a Medicare Part D prescription drug plan when you are initially eligible for Medicare. This time period includes the 7-month time frame that starts three months prior to the month in which you turn age 65. It also includes the month of your 65th birthday, and it ends three months after the month in which you turn age 65.
You can also join a Part D prescription drug plan if you have a qualifying disability and you are under age 65. If this is the case, you can join during the 7-month time period that begins the three months prior to your 25th month of disability benefits and ends three months following your 25th month of disability.
It is also possible to apply for Part D benefits if you are disabled. You can apply during the 7-month time period that starts three months prior to the month in which you turn age 65 and ends three months following the month in which you turn age 65.
Each year, between the time period of October 15 and December 7, anyone who qualifies for Medicare Part D prescription drug coverage may join, change, or drop their plan. The change in coverage will become effective on the following January 1st, provided that the individual’s request has been submitted by December 7th.
Medicare also has special enrollment periods for those individuals who have certain circumstances or situations that may deem it necessary to change their coverage. Therefore, you may be allowed to either join, change, or cancel your Medicare Part D plan if you meet any of the following criteria:
You have moved out of your Part D plan’s service area
You have lost your other creditable prescription drug coverage
You reside in an institution such as a skilled nursing facility
You now qualify for Medicaid coverage
You may also join, change, or cancel a Medicare Part D prescription drug plan at any time during the year if you qualify for the Extra Help program.
It is important to understand that if you do not enroll in a Medicare Part D prescription drug plan when you are initially eligible, and you do not have other creditable prescription drug coverage or you are on the Extra Help plan, then you may be required to pay a late enrollment penalty if you apply for a Part D plan in the future.