Medicare Prescription Drug Coverage Made Simple

Prescription drug coverage (Part D) is the most recent addition to Medicare. This coverage can help lower your current drug costs and protect you against higher costs in the future. Prescription drug plans are only available from private insurance companies, such as Horizon Healthcare of New Jersey, Inc.

How does a PDP plan work?

A Medicare Prescription Drug Plan (PDP) works like other insurance plans. Typically, you pay a predictable portion of your prescription drug costs — in other words, a deductible, copayments or coinsurance — and the plan pays the rest.

Coverage is provided in levels. Initially, your costs are kept to a minimum. Depending on the plan you select, you either make copayments on each prescription or pay coinsurance until your total drug costs have reached a certain amount (the combined total of how much you and the PDP plan have paid together).

At this point, some PDP plans have a “coverage gap”— sometimes called the “doughnut hole.” In the coverage gap, you are responsible for paying the entire cost of prescriptions until you reach the out-of-pocket limit. Once you do, coverage will kick in again, and you will only have to pay a small copayment or coinsurance for the remainder of the calendar year.

Who is eligible for Part D coverage? When and how do you enroll?

Medicare prescription drug coverage (Part D) is available to everyone with Medicare. You must decide whether or not to receive Medicare prescription drug benefits when you first become eligible for Medicare.

If you decide NOT to join a Medicare drug plan during your Initial Enrollment Period and you don’t receive Extra Help for your Medicare or you don’t have other creditable prescription drug coverage (benefits that are considered equal to or better than Medicare Part D benefits), you may have to pay a late enrollment penalty.

From October 15 and December 7, anyone can join, switch or drop a Medicare drug plan. Your coverage will begin January 1 of the following year. If you go 63 days or more in a row without a Medicare drug plan or other creditable coverage, you may have to pay a late enrollment penalty.

There are two ways to get Medicare prescription drug coverage.

1. Add it to your Original Medicare coverage by enrolling in a stand-alone Medicare Prescription Drug Plan.
2. Enroll in a Medicare Advantage plan or other Medicare health plan that offers Medicare prescription drug coverage.

Answers to commonly asked questions about Medicare prescription drug coverage

Q. Does Original Medicare already provide prescription drug coverage?
A. Medicare provides limited prescription coverage. That’s why many people choose to obtain additional coverage, to help offset their prescription drug costs.

Q. Does a PDP cover brand name and generic drugs?
A. Yes, Medicare Prescription Drug Plans cover both brand name and generic drugs from a formulary (a list of approved medications).

Q. Will I get a separate Part D card?
A. If you get a stand-alone PDP to add to Original Medicare or Original Medicare plus a Medicare Supplement plan, you will receive a separate card to use when you fill your prescriptions. If you enroll in a Medicare Advantage plan that includes prescription drug coverage, you will have one card for all your coverage.

Q.How do I pay for Medicare prescription drug coverage?
A. Most PDPs charge a monthly fee that varies by plan. You pay this in addition to the Part B premium. If you belong to a Medicare Advantage plan that includes Medicare prescription drug coverage, the monthly premium will include the prescription drug coverage.

Q. What if I can’t afford prescription drug coverage?
A. You may qualify for additional help. Several programs are available to assist you with covering additional costs. For more information, visit www.socialsecurity.gov/prescriptionhelp/. Or call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.