The good news is that when you are eligible for Medicare, you will also be able to purchase insurance that pays a portion of the costs of your prescription drugs – in many cases, most of the costs. But there are many caveats about Medicare drug coverage and large variations in coverage and costs between plans.
Original Medicare (Parts A and B) does not cover prescription drugs except in special cases (drugs given during surgery, for example). Original Medicare beneficiaries are eligible to purchase coverage for prescription drugs, called Medicare Part D, which is sold and administered by private insurers.
In contrast, most Medicare Advantage plans include prescription drug coverage.
In both cases, Medicare Part D and Medicare Advantage, it is important to remember that the specific drugs covered vary from plan to plan. The same goes for monthly premiums and other fees. It is therefore beneficial to educate yourself, shop carefully and re-evaluate your choice of package each year.
What Medicare Part D plans cover
Medicare drug plans cover both generic and brand name drugs. All plans cover certain categories of drugs to treat specific conditions. Each plan decides which specific drugs to insure by category.
Each Medicare Part D plan lists the drugs it covers on a formulary, which typically includes both brand name drugs and generic drugs. Forms change, so it is very important to regularly check that your medications are included.
You should also check each plan for restrictions on drug coverage, such as requirements that certain drugs must be approved in advance by the insurer.
If you or your provider thinks that none of the covered drugs will adequately treat your condition, you can request an exception.
What you will pay for prescriptions
In addition to Part D premiums, you may be responsible for cost sharing, which may include deductibles, copayments, or coinsurance. Medicare Part D plans set their own premiums.
Part D plan deductibles vary from $ 0 to the maximum allowed, which in 2021 is $ 445 (rising to $ 480 in 2022). Those with higher incomes will pay an additional monthly fee of $ 12.30 to $ 77.10 for Part D in 2021.
Co-payments or coinsurance
Almost all Medicare Part D and Medicare Advantage plans with prescription drug coverage charge a copayment or coinsurance. Buy with care; your costs will vary from plan to plan.
Part D coverage requires you to pay varying prices for different categories of drugs. In general, your cost share will be higher for brand name drugs.
Note that if you delay your Part D registration for too long, you will have to pay a late registration penalty.
How To Compare Medicare Part D Plans
Medicare.gov can help you find a Part D plan that covers your prescriptions and can help you compare your costs under various Medicare Part D and Medicare Advantage plans.