There are many layers to the federal Medicare program. Let us help you figure out where to begin. We'll break down Medicare into manageable pieces, so you know if you qualify for Medicare coverage, what coverage is available in your area, and how to get enrolled in a plan that fits your needs.

Medicare Prescription drug coverage

Medicare Part D prescription drug benefits started being offered in 2006. You can sign up during an open enrollment season for a Part D plan offered by a private insurance company that has a contract with the Federal government. Your Part D plan will help you pay for your current outpatient prescription medications and for medications your doctor may prescribe in the future.

You may pay both a monthly premium and a share of the cost of your prescriptions in a Part D plan. The Federal government has created a standard set of benefits that all available Part D plans must offer, but plans can offer alternatives above the standard. It is important to understand all of the key differences between Part D plans before you select and enroll in one.

Cost

The new Medicare Part D program helps cover the cost of your outpatient prescription drugs. Each Part D plan has a premium, a different cost-sharing structure, and each one offers a different set of drugs - though most plans cover the vast majority of drugs most commonly used by Medicare beneficiaries.

Covered

All prescription drug plans are required to offer ???standard coverage??? at a minimum. For 2008 this includes:

  • A deductible equal to the first $275 per year for your prescriptions. After you pay the $275 yearly deductible, here's how the costs work:
  • You pay 25% of your yearly drug costs from $275 to $2,510, and your plan pays the other 75% of these costs, then
  • You pay 100% of your next $3,215 in drug costs, then
  • You pay 5% of your drug costs (or a small copayment) for the rest of the calendar year after you have spent $4,050 out of pocket. Your plan pays the rest.

Medicare prescription drug plans will cover generic and brand-name drugs. Most plans have a formulary, which is a list of drugs the plan has decided it will pay for. This list must meet basic requirements set by the Federal government, but individual plans have flexibility to decide what goes on their formularies and how much you will pay for each drug.

If your doctor thinks you need a drug that isn't on the list, or if one of your drugs is being removed from the list, you or your doctor can apply for an exception or appeal the decision to the health plan. Your plan must let you know at least 60 days before removing a drug from its formulary, and it can choose to add new drugs as they become available.

Plans can also place restrictions on how you get your drugs, here's how:

  • Some plans may require prior authorization. A plan may require the physician to demonstrate medical necessity before the pharmacist is allowed to dispense the drug. Often the plan will want the doctor to try a different drug first.
  • Some plans may use quantity limits. This places an upper limit on how many refills of a prescription a person can have.