How to get prescription drug coverage
Medicare drug coverage helps pay for prescription drugs you need. Even if you don’t take prescription drugs now, you should consider getting Medicare drug coverage. Medicare drug coverage is optional and is offered to everyone with Medicare. If you decide not to get it when you’re first eligible, and you don’t have other creditable prescription drug coverage (like drug coverage from an employer or union) or get Extra Help, you’ll likely pay a late enrollment penalty if you join a plan later. Generally, you’ll pay this penalty for as long as you have Medicare drug coverage. To get Medicare drug coverage, you must join a Medicare-approved plan (Medicare Advantage or Prescription drug plan) that offers drug coverage. Each plan can vary in cost and specific drugs covered.
What Medicare Part D drug plans cover
All plans must cover a wide range of prescription drugs that people with Medicare take, including most drugs in certain protected classes,” like drugs to treat cancer or HIV/AIDS. A plan’s list of covered drugs is called a “formulary,” and each plan has its own formulary. Many plans place drugs into different levels, called “tiers,” on their formularies. Drugs in each tier have a different cost. For example, a drug in a lower tier will generally cost you less than a drug in a higher tier.
Most Medicare drug plans (Medicare drug plans and Medicare Advantage Plans with prescription drug coverage) have their own list of what drugs are covered, called a formulary. Plans include both brand-name prescription drugs and generic drug coverage. The formulary includes at least 2 drugs in the most commonly prescribed categories and classes. This helps make sure that people with different medical conditions can get the prescription drugs they need. All Medicare drug plans generally must cover at least 2 drugs per drug category, but plans can choose which drugs covered by Part D they will offer.
The formulary might not include your specific drug. However, in most cases, a similar drug should be available. If you or your prescriber (your doctor or other health care provider who’s legally allowed to write prescriptions) believes none of the drugs on your plan’s formulary will work for your condition, you can ask for an exception.
A Medicare drug plan can make some changes to its drug list during the year if it follows guidelines set by Medicare. Your plan may change its drug list during the year because drug therapies change, new drugs are released, or new medical information becomes available.
Note
Your plan may raise the copayment or coinsurance you pay for a particular drug when the manufacturer raises their price, or when a plan starts to offer a generic form of a drug, but you keep taking the brand name drug.
Plans offering Medicare drug coverage under Part D may immediately remove drugs from their formularies after the Food and Drug Administration (FDA) considers them unsafe or if their manufacturer removes them from the market. Plans meeting certain requirements also can immediately remove brand name drugs from their formularies and replace them with new generic drugs, or they can change the cost or coverage rules for brand name drugs when adding new generic drugs. If you’re currently taking any of these drugs, you’ll get information about the specific changes made afterwards.
For other changes involving a drug you’re currently taking that will affect you during the year, your plan must do one of these:
- Give you written notice at least 30 days before the date the change becomes effective.
- At the time you request a refill, provide written notice of the change and at least a month’s supply under the same plan rules as before the change.
You may need to change the drug you use or pay more for it. You can also ask for an exception. Generally, using drugs on your plan’s formulary will save you money. If you use a drug that isn’t on your plan’s drug list, you’ll have to pay full price instead of a copayment or coinsurance, unless you qualify for a formulary exception. All Medicare drug plans have negotiated to get lower prices for the drugs on their drug lists, so using those drugs will generally save you money. Also, using generic drugs instead of brand-name drugs may save you money
To lower costs, many plans offering prescription drug coverage place drugs into different “tiers” on their formularies. Each plan can divide its tiers in different ways. Each tier costs a different amount. Generally, a drug in a lower tier will cost you less than a drug in a higher tier.
Here's an example of a Medicare drug plan's tiers (your plan’s tiers may be different):
- Tier 1—lowest copayment : most generic prescription drugs
- Tier 2—medium copayment: preferred, brand-name prescription drugs
- Tier 3—higher copayment: non-preferred, brand-name prescription drugs
- Specialty tier—highest copayment: very high cost prescription drugs
In some cases, if your drug is in a higher tier and your prescriber (your doctor or other health care provider who’s legally allowed to write prescriptions) thinks you need that drug instead of a similar drug in a lower tier, you or your prescriber can ask your plan for an exception to get a lower coinsurance or copayment for the drug in the higher tier. Plans can change their formularies at any time. Your plan may notify you of any formulary changes that affect drugs you’re taking.
Costs for Medicare drug coverage
You'll make these payments throughout the year in a Medicare drug plan:
- Premium
- Yearly deductible
- Copayments or coinsurance
- Costs in the coverage gap
- Costs if you get Extra Help
- Costs if you pay a late enrollment penalty
Your actual drug coverage costs will vary depending on:
- Your prescriptions and whether they’re on your plan’s list of covered drugs ( formulary ).
- What “tier” the drug is in.
- Which drug benefit phase you’re in (like whether you’ve met your deductible, or if you’re in the catastrophic coverage phase).
- Which pharmacy you use (whether it offers preferred or standard cost sharing, is out of network , or is mail order). Your out-of-pocket drug costs may be less at a preferred pharmacy because it has agreed with your plan to charge less.
- Whether you get Extra Help paying your drug coverage costs