|  | Healthcare Industry | Health Insurance

Medicare Part D Insurance Options

Medicare Part D, introduced in 2005, is Medicare's prescription drug benefit. Unlike Parts A and B you can't get Part D through Medicare directly. Part D is offered through private companies approved by Medicare. In many states there are 30 plans or more from which to choose. To make things even more confusing, there are only certain times of the year you can enroll, and if you have drug coverage through your retirement plan or the Veteran's Administration, you may not need Part D at all.

  1. Standalone Plans

    • If you have original Medicare with no other health insurance coverage, or original Medicare with a Medicare supplement, you need a standalone Part D plan. These plans have a monthly premium (in addition to the premiums for Medicare Supplements and Medicare Part B), co-pays, and possibly a deductible. There is also a coverage gap in every plan, meaning that once you've reached a set amount in total prescription costs ($2,530 in 2011), the plan will no longer provide coverage. This is commonly called the "donut hole." Once you've spent a set amount out of pocket ($4,550 in 2011), you reach catastrophic coverage, which has reduced prescription costs.

    Medicare Advantage Plans

    • Another option for prescription coverage is a Medicare Advantage plan. Medicare Advantage plans combine medical and hospital coverage with prescription coverage. These plans also have a monthly premium, but it's one premium for both the medical and prescription coverage. You will also need to continue paying your Medicare Part B premium. There is still a coverage gap in your prescription coverage, and there are co-pays, coinsurance and deductibles.

    Enrolling, Cancelling or Changing Plans

    • There are specific times you can make plan changes, including enrolling into a plan for the first time, canceling your current plan and switching plans. These include when you turn 65 and first qualify for Medicare, when you move into a new coverage area and can't stay on your previous plan, and when you involuntarily lose coverage. You also have an opportunity to make changes to your plan from October 15 to December 7 each year. Those changes become effective January 1. It's important to enroll when you are first eligible; Medicare adds a penalty to your premium if you don't enroll when first eligible.

    Extra Help

    • Medicare offers "Extra Help" to those with limited incomes. There are different levels of "Extra Help." If you're on Medicaid or Supplemental Security Income (SSI), your monthly premium will be fully covered, and your co-pays will be significantly lower. If your income is too high to qualify for Medicaid, you can apply for reduced premiums and co-pays. You apply through Social Security, and call or visit a local office for an application.

Health Insurance - Related Articles