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RX for America (Part D)

Updated: May 31

America was going through a time of recovery. We all watched in horror as the towers came down. Although our nation suffered a huge loss, we were mostly united as nation. There were encouraging promises on the horizon. Modern research and medical technology were exploding in the early 2000’s. Unfortunately, there was a big elephant in the room. Prescription costs were sky rocketing and becoming unaffordable for seniors. Congress introduced the “Medicare Prescription Drug, Improvement, and Modernization Act of 2003.” It took a few years to gain traction and it finally was signed into law in 2006. Finally seniors had some relief from prescription costs.

Part D is a prescription plan for people on Medicare. It is optional and can be added if you have Part A or Part B. It can be a “stand alone” plan, meaning not attached to a health plan. It can also be attached to all in plan with Medicare part C. More on that at a later date. Here are some important things to remember when considering a Part D plan: Private company: Part D plans are administered through private companies that have a contract with Medicare. Formulary: Every plan has a list of covered drugs called a formulary. It’s important to make sure that the prescriptions your taking is on this list. Tiers: The plans have different tiers. The lower the cost of the drug the lower the tier it should be in. Late penalty: Maintaining “credible coverage” is important to avoid being penalized with a penalty. Your drug coverage, whether through a group plan or other avenue, must be as good as Medicare’s model. If you don’t have credible coverage when enrolling in Medicare Part A or B, you must enroll in a Part D to avoid a late penalty. The late penalty is 1% of the national average. In 2022 that would work out to be 33 cents for every month you did not have credible coverage. This penalty would only be imposed if enrolling in a Part D plan in the future. Coverage gap: The coverage gap use to be referred to as the “donut hole”. The coverage gap is when a Medicare beneficiary would endure higher prescription costs. This would begin after total drug costs reach $4,430. Brand name drugs will cost no more than 25% of the drug covered by the plan. The full price of the drug will count towards catastrophic coverage. After your total out of pocket cost have reached $7,050, you would exit the coverage gap and enter the catastrophic stage. At this point much needed relief would be in effect for through December 31st. Of course this is just a brief overview of the Part D program. This article just hits the highlights of the important information. Please reach out to me if you have specific questions or need guidance on a Part D plan. You can contact me through my website at ncseniorsolutions.com. Leave your comments below!

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