Medicare Part D
Let's Simplify Prescription Drug Coverage
Medicare Part D is the part of Medicare that helps pay for your outpatient prescription medications.
But there’s an important distinction:
Medicare Part D is not provided directly by Original Medicare.
- Part D plans are offered by private insurance companies approved by Medicare.
- If you have Original Medicare with a Medicare Supplement, you will typically purchase a separate Part D prescription drug plan.
- If you choose Medicare Advantage, prescription drug coverage is often included within the Medicare Advantage plan.
- The important thing to understand is that not every Part D plan covers your prescriptions the same way.
How Does Part D Work?
Think of Part D as insurance specifically for your prescription medications.
You choose a plan and generally pay a monthly premium.
When you fill a prescription, what you pay depends on several things:
- The medication you're taking
- Whether the medication is covered by the plan
- Which tier the medication is placed on
- The pharmacy you use
- The plan's deductible
- The plan's copay or coinsurance for that medication
That’s why we don’t recommend choosing a Part D plan based solely on the monthly premium.
The lowest-premium plan isn’t necessarily the lowest-cost plan for you.
Part D Now Has Annual Out-of-Pocket Protection
One of the most important recent changes to Medicare Part D is the addition of an annual limit on what beneficiaries can pay out of pocket for covered Part D medications.
This provides significantly greater protection for people who take expensive medications
The specific limit can change from year to year, which is why it’s important to review the current Medicare rules when evaluating your coverage.
We Start With Your Prescriptions
When we help someone evaluate Part D coverage, we don’t start with the insurance company.
We start with your medication list.
We want to know:
- What medications do you take?
- What dosage do you take?
- How often do you take them?
- Which pharmacy do you prefer?
Then we can compare how the available Part D plans cover those specific prescriptions.
This allows us to look beyond the monthly premium and estimate your overall prescription drug costs for the year.
Every Part D Plan Has a Formulary
A formulary is simply the plan’s list of covered medications.
Different Part D plans can have different formularies.
A prescription may be inexpensive under one plan but significantly more expensive under another.
Plans also typically divide medications into different tiers.
Generally, lower-tier medications have lower copays, while higher-tier or specialty medications may have higher costs.
The important question isn’t:
“Is this a good Part D plan?”
It’s:
“Is this a good Part D plan for the medications I take?”
Your Pharmacy Matters Too
The pharmacy you use can make a difference.
Part D plans establish pharmacy networks, and some pharmacies may be considered preferred pharmacies.
You could potentially pay less for the exact same prescription simply by using a preferred pharmacy within your plan.
That’s why our Part D review looks at both:
- Your prescriptions + Your pharmacy
- Together, those two pieces can have a significant impact on what you actually pay.
What Does Part D Cost?
There are several potential costs to understand:
Monthly Premium
Most standalone Part D plans charge a monthly premium.
Premiums vary by plan and location.
Higher-income Medicare beneficiaries may also pay an additional Medicare Part D income-related adjustment known as IRMAA.
Annual Deductible
Some plans have a deductible that you must satisfy before certain prescription benefits begin.
Copays and Coinsurance
Once your coverage applies, you may pay either a fixed copay or a percentage of the medication’s cost.
The amount depends on your plan and the medication.
Don't Ignore Part D Because You Don't Take Prescriptions
We hear this all the time:
“I don’t take any medications. Why would I need a drug plan?”
Even if you don’t currently take prescriptions, it’s important to understand Medicare’s rules regarding creditable prescription drug coverage.
If you go without Part D or other creditable prescription drug coverage for too long after you’re eligible, you could potentially face a late-enrollment penalty when you enroll later.
And that penalty can continue for as long as you have Part D coverage.
So even if you don’t take medications today, Part D is something you should still address as part of your Medicare planning.
Part D Is One Piece of Your Medicare Coverage
If you choose Original Medicare with a Medicare Supplement, your coverage may look like:
- Medicare Part A + Part B
- + Medicare Supplement
- + Part D Prescription Drug Plan
- Each piece has a different job.
Original Medicare provides your primary medical and hospital coverage.
Your Medicare Supplement helps reduce or eliminate many of the financial gaps left by Original Medicare.
And your Part D plan helps protect you from the cost of prescription medications.
How HCS Approaches Part D
We don’t believe Part D needs to be complicated.
Our process is straightforward:
1
Tell us what prescriptions you take.
2
Tell us which pharmacy you prefer.
3
We compare the available plans.
4
We look at premium + estimated prescription costs.
5
We help you understand which plan may provide the best overall value for your situation.
The goal isn’t simply to find the plan with the lowest premium.
The goal is to find the coverage that works best for your prescriptions.
Need Help With Your Prescription Coverage?
We’ll review your medications and help you understand the Part D options available where you live.