- Medicare Part D prescription drug coverage
- Special things people with cancer need to think about
- Who should enroll in Medicare Part D?
- Making a Part D plan decision
- Getting help to pay Medicare Part A and/or Part B premiums (the Medicare Savings Programs)
- Formularies and drug coverage
- Where can I use my Part D drug coverage to fill my prescriptions?
- How much will the Part D drug plan cost?
- Things to know once you’ve chosen a Part D drug plan
- Switching drug plans in the future
- Frequently asked questions
- Where can I get more help?
- Are you ready to get started?
- More information from your American Cancer Society
How much will the Part D drug plan cost?
All of the stand-alone Part D plans and most of the drug plans sold in connection with Medicare Advantage plans (MA-PDs) charge a premium for the drug benefit. The premium amount will depend on where you live and the plan you choose. This premium is in addition to any Part B premium you pay or have withheld from your monthly Social Security check.
Note: In addition to the Part D premium paid to a plan, an income-related monthly adjustment amount is collected by the federal government. For 2014, this extra payment applies only to individuals with incomes above $85,000 and couples with incomes above $170,000 on their last completed tax return. (So, in early 2014 this would be based on their 2012 tax return.)
What will my monthly prescription drug plan premium be?
Every prescription drug plan (PDP) charges a monthly premium to enroll, but the amount varies by plan. In some states, you may find plans charging as little as $10 per month. Other plans charge a lot more. Many drug plan sponsors, such as Aetna, Cigna, Humana, Prescription Pathway, and WellCare, offer more than one plan option, and price each option differently.
The higher premium plans may have a lower deductible or no deductible at all, and may offer lower co-pays. You should figure out which plans cover your drugs and also compare the co-pays for each drug. The final numbers you should look at are your total expected costs for the year after you add up premiums, co-pays, the deductible, and the risk of falling into the coverage gap.
Plans that fill in some, or all, of the coverage gap (donut hole) are also more likely to have a high premium when compared with those that don’t do this. Still, premiums vary for a number of reasons, and it’s not always true that higher premiums mean lower out-of-pocket drug costs or a bigger formulary. As an example, Table 4 shows the range of premiums charged by PDPs in Arizona in 2014.
Table 4: Prescription Drug Plan (PDP) premiums, cost-sharing requirements, and drug coverage: Arizona
PDPs in Arizona
Range of PDP monthly premiums
$12.60 to $135.10
PDPs with no premium for low-income subsidy beneficiaries
PDPs with $0 deductible
PDPs with some coverage offered in drug coverage gap (“donut hole”)
What if I want to get my drug coverage through a Medicare Advantage plan?
Medicare Advantage plans may be health maintenance organizations (HMOs), preferred provider organizations (PPOs), or private fee-for-service plans. There are also some Medicare Advantage plans tailored to people with special needs, such as long-term care needs. Every Medicare Advantage plan must offer at least one Part D prescription drug plan. Some plans may offer options that don’t include Part D coverage. (These are designed for enrollees who may have other sources of drug coverage, such as through the Veteran’s Administration.) It’s important to know that these plans may change every year but they will send you a notice about any changes each fall. You’ll want to review this notice to be sure it still fits your needs.
You may see 2 premiums listed with Medicare Advantage plans: (1) the premium for the MA-PD (the drug premium) and (2) a total Medicare Advantage premium. The total Medicare Advantage premium includes your cost for medical care coverage such as hospital, doctor, and other non-drug services, and takes the place of the Part B premium.
How much of the premium will I have to pay if I qualify for low income assistance?
If your income is less than a certain amount that is pre-set every year, you may be able to get help paying the premium and co-pays of Medicare Part D.
If you qualify for the special low-income assistance program (called Extra Help or the low-income subsidy [LIS]), then your monthly premium may be partly or fully paid by Medicare, Medicaid, and Social Security. Your co-pays, co-insurance, and yearly deductible will go down, too.
If you choose a drug plan that has a premium at or below the amount covered by Extra Help, then you will not have to pay any Part D premium. But if you pick a drug plan that has a higher premium than the Extra Help premium amount for your state (above basic coverage) you will have to pay the difference. How much you have to pay depends on the level of help for which you qualify and that particular drug plan’s premiums.
See the section called “Getting help to pay Medicare Part A and/or Part B premiums (the Medicare Savings Programs)” for more on this. Or, you can go to www.medicare.gov/publications to read the brochure called “Get Help With Your Medicare Costs: Getting Started.” You can also call 1-800-MEDICARE (1-800-633-4227) to find out if a copy of this brochure can be mailed to you, or to ask questions about low income help.
Last Medical Review: 01/22/2014
Last Revised: 01/23/2014