Medicare D Card Insurance Problems

Medicare comes in four parts. Original Medicare, Parts A and B, cover inpatient and outpatient services such as hospitalizations, exams, health screenings and vaccinations. Part C, more often referred to as Medicare Advantage, allows users to buy their Part A and B Medicare from private companies. Medicare Advantage sometimes comes with additional benefits, such as hearing, vision or dental. Part D Medicare covers prescription drugs only. Part D is sold through private companies. Using Medicare Part D can be confusing and problematic to seniors because of its various restrictions and rules, which can change depending on the plan and insurance company.

Late Penalty

• Most people are eligible for Medicare coverage as they approach their 65th birthday. Individuals who want to enroll in the program must do so during their initial enrollment period, which lasts from three months before a person's birthday month until three months after. During this time, the beneficiary can enroll in any part of Medicare she chooses. However, if she does not enroll in Medicare and then changes her mind later, she will have to pay a late enrollment penalty if she did not have some other kind of creditable drug insurance. The penalty lasts for as long as a person keeps it. Cost of the penalty depends on how long a beneficiary waited to enroll.

Drug Coverage

• Another problem with Part D is that not all drugs are covered. Seniors who require the more expensive prescriptions may not be able to find plans that cover them, or, if they do, require unusually high monthly premiums. More affordable plans may only cover generic drugs or common, inexpensive drugs that the user does not need assistance with.

Service Area

• Part D plans are sold by service area. If a senior moves out of the plan's service area, he might need to change plans or insurance companies, regardless of whether or not he wanted to do so. Additionally, if a company decides to leave the area itself, then users also will have to change plans. For beneficiaries who need a plan to cover specific drugs, it can be difficult or expensive to find another suitable plan in their service area.

Premiums

• Though very-low-income seniors can sometimes get assistance, Part D plans require monthly premium payments. These can be a burden to people on fixed or limited incomes. In addition, seniors must continue to meet their premium payments, including any late penalties, when coverage ceases because of the Part D donut hole.

Donut Hole

• One of the biggest problems with Part D Medicare is what is called the donut hole. When a user's drug costs reach a certain level, then benefits stop and the senior must pay all prescription drug costs out of pocket until he reaches the catastrophic threshold, when benefits resume. In 2011, the United States began rolling out measures to plug the hole, which includes increasing discounts on both generic and name-brand drugs while in the hole and a one-time rebate. Until 2020, however, the donut hole will still exist.