Prescription Drug Programs for Medicare Members

Medicare members have access to prescription drug coverage through Medicare Part D, the Medicare prescription drug program. It is through a Medicare Part D plan that most seniors and others on Medicare receive their prescription drugs. It is also possible for Medicare members to get drug coverage through an employer or union. Low-income Medicare recipients may receive help paying for their Part D plan and their drugs by applying for assistance through the Extra Help program.

Medicare Part D

• Anyone who receives Medicare benefits, either because they are turning 65 or because they are disabled, is eligible to enroll in a Medicare prescription drug program, also known as Medicare Part D. You have a seven-month enrollment period, beginning three months before you become eligible for Medicare and ending three months after the month in which you become eligible. If you do not enroll during this period, you may be assessed a penalty for late enrollment and will have to wait until the annual open enrollment period at the end of the year to purchase a plan.

  Medicare drug programs are sold by private insurance companies and each state has a number of plans to choose from. The plans all have formularies, which are the lists of drugs that they cover. Each company selling drug coverage has a different formulary and it is important to enroll in a plan that covers the drugs that you take. All plans are required to cover the most widely prescribed drugs and it is possible to petition plans to get temporary coverage of a drug that is not on their formulary. You can then change plans during the annual open enrollment period to a plan that does cover the drugs you are taking.

  Medicare prescription drug programs have three cost components: a premium, a deductible and a co-pay or co-insurance. The premium is paid monthly and varies by plan. The average premium for Medicare Part D plans in 2010 is $46, but there are plans priced well below and well above that in most states. Some plans may have a deductible, which cannot exceed $310 in 2010. When you have covered the deductible, your co-pay or co-insurance will be about 25 percent of the cost of your drugs and the insurance company will pay the other 75 percent. If the total cost of your drugs reaches $2830, you will enter the donut hole, where you will be responsible for paying a larger proportion of your drug costs.

Extra Help Program

• For individuals on Medicare who have income below federal and state-determined limits, there are programs that will pay for the monthly premium and much of the drug co-pays. Check with your local Department of Human Services or your Social Security Office to see if you qualify for the Extra Help program to help pay your drug costs.

Employer Drug Plans

• If you have drug coverage through your employer or union, you can continue to receive your prescription drugs through that plan and do not have to enroll in a Medicare Part D drug plan. You can enroll in Medicare Part D at a later date without paying a penalty as long as the coverage you have is as good as or better than the coverage provided by Medicare, know as creditable coverage.