Medicare Part D

Medicare Part D, also known as Prescription Drug Plan, changes every year. As we discussed last month, Annual Enrollment Period (AEP) occurs once a year. This is the only time of the year you can change your Part D plan unless you qualify for a Special Enrollment Period (SEP). For example, if you move out of the service area, if you are institutionalized, or experience any other “exceptional circumstance,” you may be qualified for a SEP.

There are different phases to Part D coverage, and we know it can get confusing, especially with phrases like ‘donut hole’. Let’s talk about the four stages of Part D coverage below:

  1. Deductible Stage – During this stage you will pay the full cost of your medications until the deductible is met. The average deductible is around $415.
  2. Initial Coverage Stage – After you meet your deductible, your plan will help pay for your medications. Your plan will pay for some of the cost, and you will pay a copay or coinsurance until you reach your plan’s initial coverage limit. How long you stay in this stage depends on your drug costs and your plan’s benefit structure.
  3. Coverage Gap – This stage, commonly known as the “donut hole,” the client will pay approximately 25% for brand-name medications and 25% for generic medications.
  4. Catastrophic Stage – After you reach a total of $5,000 in out-of-pocket expenses you will enter this stage. During this stage you will pay the greater of 5% coinsurance for generic medications and the greater of 5% for brand-name medications.

MWG Senior Services offers the free service of assisting our Medicare Supplement and Medicare Advantage clients with their Part D drug analyses each year. If you would like to review Medicare Supplement or Medicare Advantage plan options, please give us a call today at 877-759-5760 or email us at seniorservices@morganwhite.com. Let us know that you read this blog!