What Does Medicare Part D Cover?
Medicare Part D is prescription drug coverage available to anyone with Medicare Part A and/or Part B. Much like Medicare Part C, Part D plans are offered by private insurance companies.
Reminder: Many MA plans include Part D coverage and are referred to as MAPD plans. Medicare Supplements do not include prescription coverage and therefore require enrollees to purchase a separate Part D plan.
How Much Does Part D Cost?
Actual costs of Part D plans are set by the insurance companies and approved by the government. In addition, the amount you pay for your medications is agreed upon between the insurance company and the drug company, then approved by the government.
Most Part D plans include:
- A monthly premium
- An annual deductible
- A prescription drug formulary
- Copays and/or coinsurance per drug
- Coverage phases (Initial Coverage Phase, the Coverage Gap or the Donut Hole, and the Catastrophic Coverage Phase)
Your costs will vary based on the medications that you take and the plan you choose. Like with Medicare Advantage and Supplement plans, insurers can make changes, during Medicare’s Annual Enrollment Period, to their plans’ benefits. If your income is above a certain level (adjusted gross income of $85,000 per individual or $170,000 for a married couple filing jointly), you will also pay a Part D surcharge. This additional charge is due on top of your plan’s monthly premium.