What Do Medicare Part D Members Pay for Prescription Drugs?Posted by Medicare Made Clear
Medicare Part D is a prescription drug plan that an individual buys from a private insurance company. Each plan, whether it’s purchased in addition to Original Medicare (Part A and Part B) or comes as part of a Medicare Advantage (Part C) plan, will include cost sharing. This means you will share the cost of the medications you take with the plan you choose. Types of cost sharing may include monthly premiums, copays or coinsurance and/or deductibles.
Your copayment (also called copay) is the fixed amount you pay for a covered service or product. For example, you might have to pay $10 each time you fill a prescription. Coinsurance is splitting your health care costs with the plan on a percentage basis. For example, you pay 20% and the plan pays the remaining 80%.
You will pay a premium for your Medicare Part D plan. A premium is a monthly cost you pay to remain a member of the plan, and the amount is determined by the insurance company that provides your selected plan. A deductible is a kind of cost sharing A term for the way Medicare shares your health care costs with you. The most common types of cost sharing are deductibles, copays and coinsurance.
where you pay a pre-set, fixed amount first, before Medicare or other insurance starts to pay. Some Medicare Part D plans have a deductible and some don’t, depending on the plan’s provider.
Your actual drug plan costs will vary by plan and will depend on the prescriptions you use, the pharmacy you choose, and whether you get Extra Help paying for your Medicare Part D costs. Read some helpful tips for Medicare members to save on prescription drugs.
Many Medicare Part D plans have what’s called a “tiered formulary.” A formulary is a list of the prescription drugs covered by a specific plan. In a tiered formulary, the plan divides approved drugs into groups, called “tiers.” Generally, the lower the tier, the lower your copay costs. For example, a generic version of a drug in Tier 1 may have a lower copay than a brand-name version of the same drug in Tier 3.
When you and the plan together have paid a certain amount of money (decided by the plan) for your prescription drugs, you enter a coverage gap (also called “doughnut hole”). During this time, you will pay more for your prescriptions than you did before you reached the coverage gap. In 2011, generally, members in the coverage gap are responsible for 93% of the cost of generic drugs, and about 50% of the cost of most brand-name drugs. There is a limit to how much you can pay out-of-pocket in a single year, however. After you reach this limit, you leave the coverage gap and enter the catastrophic coverage phase, where your plan pays a larger share of your costs than you do. Learn more about the coverage gap.
For more information contact the Medicare helpline 24 hours a day, 7 days a week at 1-800-MEDICARE (1-800-633-4227), TTY 1-877-486-2048. You can also contact UnitedHealthcare® Medicare Made Clear to learn more 1-877-619-5582, TTY 711, 8 a.m. – 8 p.m. local time, 7 days a week.
Y0066_110802_091756 File & Use 08102011