Medicare Part D . where do I apply? What is the doughnut hole and how does it work? How much does Medicare Part D cost? Can I sign up for Part D at any time? Which plan is the best one for me? Are drugs covered by my Medigap plan?
Where do I apply for Medicare Part D?
You can sign up for the Medicare prescription drug plan online or over the phone through Medicare. If you have selected a plan, you can sign up direct with the carrier, either online or by phone. Some agents that work in the Medicare market will advise or assist you in securing Part D coverage.
Pick your poison.
Your monthly premium for drug coverage is the same whether you buy through Medicare, direct from the carrier or through an agent. If you know how to navigate the drug formulary you can certainly do this yourself. But let me caution you against doing that.
Most of the people I talk to about their Part D coverage do not really understand the way it works. If they bought a co-branded plan, such as the Humana-Walmart plan, they believe they can only use their card at Walmart.
Many times clients that have a drug plan think all their medications must be purchased through the participating retail pharmacy or the mail order pharmacy. They don’t look at other options to parse out their medications in order to save money.
Ken’s Pharmacy Plan
Ken is a new client that likes to take charge. There is nothing wrong with that as long as you understand what you are doing.
Ken called me because he needed advice on Medicare supplement plans. We discussed several options and he decided on the plan I suggested which saved him over $700 per year vs. the plan he picked on his own.
I literally don’t make any money from Part D plans but I do offer advice as a service for my Medigap clients only. So I asked him which plan he was considering for prescription drugs.
Ken took a couple of low priced medications, less than $10 each but one was $180 every month. After reviewing Part D plans on his own he told me he would be buying a plan with a $38 monthly premium. His $180 drug was covered subject to a $310 deductible followed by a $90 copay.
I suggested a different way to put his coverage together. Rather than the $38 plan with the $90 copay why not buy a $12 plan and order his medications online at a third of the cost under the drug plan?
We ran the numbers and his savings worked out to over $700 per year.
Added to his Medigap savings, Ken will save over $1400 a year.
I can’t guarantee you will save that much, but I will work hard to show you ways to save money.
What is the doughnut hole and how does it work?
The Part D doughnut hole was incorporated into Medicare drug plans in order to make the coverage affordable. If your covered drug charge totals exceed your basic coverage you enter a gap period known as the doughnut hole. In 2014 you reach the gap when the amount paid by you and your plan hit $2850.
Once you reach the doughnut hole you pay 47.5% of the cost of your drugs until you get to the other side of the hole.
Obamacare will gradually close the doughnut hole between now and 2020. The trade off will be higher premiums, higher copay’s and higher out of pocket.
Can I sign up for Part D at any time?
When you first turn 65 and enroll in Part B you have 60 days to pick a drug plan. If you do not enroll in a drug plan at that time your next opportunity is during AEP (annual enrollment period) which runs from October 15 to December 7 of ever year. You may be subject to an LEP (late enrollment penalty).
CMS allows you to enroll or change your Part D plan every year during AEP.
During 2014 the lowest cost plan in Georgia is the co-branded Humana-Walmart plan. At $12.60 per month it is a good plan for someone who takes only a few low cost medications. Last year the low cost leader was from AARP at $15 per month.
You should pick a plan based on your particular needs regardless of the premium.
Are drugs covered by my Medigap plan?
Some drugs are covered under your Medigap plan but don’t count on that to bail you out. Medicare Part B will pay for infusion therapy and some injectible drugs. After you pay your Part B deductible ($147 in 2014) Medicare will pay 80% of the negotiated cost of the drug.
You pay the other 20% unless you have a GOOD Medicare supplement plan.
In 2010 Medicare paid over $19 billion for Part B medications. Velcade, a cancer drug, costs over $19,000 per year per patient. If you are that patient and you don’t have a Medigap plan, you pick up roughly $3800 per year.
Ventavis, used to treat pulmonary arterial hypertension, is more than $130,000 per year.
Your portion (without Medigap) is over $26,000 per year.
You should consider a good Medicare supplement plan in addition to your Medicare Part D plan .
Shop and compare Georgia Medigap plans.