Friday, March 23, 2012

Medicare Part D - What You Need to Know

Medicare Part D can be a snake pit if you don't understand how it works. Medicare Part D can be a blessing for some but a nightmare for others. Seniors age 65 and older are not required to buy a Medicare Part D plan, but if you don't and then later change your mind, you will be subject to a Late Enrollment Penalty (LEP) of 1% per month.

If you were eligible to buy a Medicare Part D plan when you turned 65 but waited 3 years to buy one, you would pay a LIFETIME PENALTY in 36% additional premiums.

Medicare Part D Traps and Penalties

In 2003, Congress enacted the Medicare Modernization Act that would forever change benefits, especially as it impacts the cost of prescription drugs. Did you know . . .

  • Outpatient prescription drugs are not part of Medicare, but rather a private insurance product marketed and administered by health insurance carriers.

  • Pharmacy Benefit Managers (PBM) negotiate pricing tiers for prescription drugs but the insurance carriers decide which drugs to include in their plan

  • Insurance carriers also assign tiers and copays for the Prescription Drug Plan (PDP) as well as setting the premium you pay

  • Medicare Part D is a voluntary plan but you will pay a penalty if you fail to enroll on a timely basis

  • Once enrolled, you must remain in the plan until the next enrollment period BUT your plan can add or drop drugs during the year as they see fit

  • Non-formulary drugs do not count toward your deductible or Rx out of pocket maximum

How do you enroll in Medicare Part D?

You should start by making a list of all your current medications by name. Include the dosage and how often you fill your prescription.

Next, use the Medicare Prescription Drug Formulary Plan Finder to determine which plan is best for you.

You can also call 1-800-MEDICARE and ask for assistance.

If you have a regular pharmacy, such as CVS or Walgreens, you can take your list of prescription drugs to your pharmacy and ask them for assistance in selecting a Medicare Part D plan.

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