Medicare Part D
Understanding the Late Enrollment Penalty
Part D of Medicare covers prescription drugs, and anyone enrolled in Medicare Part A or Medicare Part B is eligible for this coverage, regardless of income and resources, health status, or current prescription drug expenses.
Participation in Part D is voluntary and can be especially helpful for people who have high prescription drug costs and no current prescription drug coverage. Medicare prescription drug plans (PDPs) pay for generic and brand name prescription drugs. As with Medicare Part B, there are monthly premiums, deductibles, and copayments. To receive Part D benefits, you must pick a plan offered by a Medicare-approved private insurance company. Availability of Part D plans varies from area to area.
Annual Election Period (AEP)
The Annual Election Period (AEP) for Medicare prescription drug plans is from October 15 until December 7. During this period, if you’re enrolled in Medicare Part A or Part B you can join a prescription drug plan or change from one drug plan to another. You can also give up Part D coverage entirely, or change from Original Medicare to a Medicare Advantage Plan and vice versa.
It’s important to be aware that, while the Annual Election Period used to extend to the end of December, this year’s AEP will end on December 7. After that you’ll have to wait until the next year’s Annual Election Period to change your drug coverage unless you’re able to qualify for a Special Enrollment Period (SEP).
Part D Benefit Stages
Regardless of the prescription drug plan you enroll in, you’ll soon learn there are four phases associated with Medicare Part D coverage.
During the deductible stage, you’re responsible for paying any deductible your plan requires you to pay before your drug plan begins making payments for your prescription drugs. Once your deductible is met, you enter the initial coverage stage, which normally requires you to pay copayments or coinsurance. Next is the donut hole or coverage gap stage, where typically you’ll pay drug costs out of pocket. Once your total out-of-pocket costs (including your yearly deductible, copayment, and coinsurance amounts) reach $4,700, you enter the catastrophic coverage stage, where you automatically get catastrophic coverage and are required to pay only a small copayment or coinsurance amount for the rest of the year.
For further information on each benefit stage, see our benefit stages page here.
You never know what lies ahead, so if you’re lacking in adequate prescription drug coverage it’s important to join a Medicare prescription drug plan as soon as you become Medicare eligible. Otherwise, you can be assessed penalties if you join later. Remember, if you miss your Medicare prescription drug plan enrollment deadline you’ll probably have to wait until the next Annual Election Period before you can enroll for coverage starting the next calendar year.
At MedicareMall we take every client’s unique situation into account in order to find the best Medicare prescription drug coverage for everyone. If you’d like to know more about Medicare prescription drug plans, contact MedicareMall now and one of our licensed, bonded representatives will be happy to answer any questions and to help you find the prescription drug plan that‘s best for you and your wallet.