Prescription Drug Coverage

Medicare Part D provides coverage for prescriptions and some vaccines. Part D plans are offered by Private Insurance companies approved by Medicare. Choices vary depending on where you live and drug plans must meet the basic guidelines created by the federal government.

Every Part D plan (stand-alone or integrated) has a drug list or formulary that shows all the brand name and generic drugs it covers. Most formularies categorize drugs into tiers based on cost.

Part D coverage has 4 cost stages:
1. Annual Deductible (You pay for your drugs until reaching plans deductible, if any)
2. Initial Coverage (You pay a co-pay and plan pays the rest)
3. Coverage Gap (Donut Hole) (You pay 25% of the cost of both generic or brand drugs)
4. Catastrophic Coverage (You pay a small co-pay for the rest of the plan year)

If you delay your enrollment into Part D you could pay a 1% penalty of the average Part D plan premium each month you delay. The penalty is charged every month for as long as you’re enrolled!