What is Medicare Part D?

We’ve put this section together to help answer some of your questions, but feel free to contact us with your questions.

Medicare Part D is the federal government’s prescription drug program that covers both brand-name and generic prescription drugs at participating pharmacies in your area. The coverage is available to all people eligible for Medicare, regardless of income and resources, health status, or current prescription expenses. Medicare prescription drug coverage provides protection for people who have very high drug costs.

How does Medicare prescription drug coverage work?

Medicare Part D works in tandem with Medicare Parts A and B. Individuals entitled to Part A or enrolled in Part B can sign up for Part D to receive help paying for prescription drugs. Like other insurance, if you join, you will pay a monthly premium, which varies by plan, and (for most plans) a yearly deductible. You will also pay a part of the cost of your prescriptions, including a co-payment or coinsurance. Costs will vary depending on which drug plan you choose. Some plans may offer more coverage and additional drugs for a higher monthly premium. Plans also vary in terms of the co-pays, prescription drugs that are covered (this is called the “plan formulary”) and the pharmacies that may be used.

If you have limited income and resources, and you qualify for extra help, you may not have to pay a premium or deductible. Individuals enrolled in both Medicare and Medicaid (“Dual Eligibles”) who have not already selected a Part D plan will be automatically enrolled in Medicare Part D by their state agency.

If I am on Medicare do I have to enroll in Part D?

Medicare Part D is an optional plan. No one is required to enroll but if you are eligible and delay enrolling, you risk paying a penalty in terms of increased insurance premiums when and if you enroll at a later date.

How do I get more information and enroll? 

Enrolling in Medicare Part D is easy. Call us or click here for a free Medicare Part D quote. We can answer your questions and handle your enrollment over the phone or email/mail an application to you if you wish. Coverage becomes effective on the first day of the month after your enrollment.

What is the Initial Enrollment Period (IEP)?

The Initial Enrollment period for Medicare Part D (IEP) is a one-time event when an individual first has the opportunity to enroll in Medicare. It occurs for most people when turning age 65. For people turning 65 the Part D IEP lasts seven (7) months (it begins three (3) months prior to your birth month, includes your birth month, and extends three (3) months after your birth month). In addition, people enrolling in Medicare Part B after their entitlement to Part A ends, may enroll in Part D using a Special Election Period (SEP). If no SEP is applicable they may enroll in Part D during the next Annual Election Period (AEP), however a penalty may be enforced which would increase their premiums for Part D.

What is the Annual Election Period (AEP)?

The Annual Election Period begins October 15, and ends December 7. Anyone who already enrolled in a Medicare Part D plan may change plans during this period each year without penalty. Eligible individuals (people on Medicare) who chose not to enroll during their initial Open-Enrollment Period may enroll in Medicare Part D between October 15 and December 7 each year, but penalties will apply unless the individual had “creditable” prescription drug coverage*. Enrollments during this period have an effective date of January 01.

What is a Special Election Period (SEP)?

A Special Election Period means that you are allowed to enroll in Medicare Part D without penalty after the Initial Election Period and/or Annual Election Period because you meet certain conditions set forth by the government. Below are the specific situations which might qualify you for a SEP.

You may qualify for a Special Election Period if:

  • You are a Hurricane evacuee and reside in certain zip codes as identified by the Federal Emergency Management Agency at the time of the hurricane.
  • You move permanently outside your plan’s service area.
  • You’re enrolled in another prescription drug plan or a Medicare Advantage plan whose contract is terminated.
  • You are not adequately informed about creditable prescription drug coverage.
  • You lose your previous creditable coverage through no action of your own*.
  • Your enrollment or non-enrollment is caused by an error by a federal employee or contractor hired by the federal government.
  • You were eligible for both Medicare and Medicaid (a “dual eligible”) but you lost your dual eligibility status.
  • You want to move from an employer-sponsored prescription drug plan to a Medicare Prescription Drug Plan.
  • You want to leave your current Medicare Prescription Drug Plan because it was reprimanded by the federal government or the federal government has determined the plan violated a material provision of its Medicare contract in relation to services provided to you.
  • You’re enrolled in a Cost Plan that isn’t renewing its contract with Medicare. This SEP begins 90 calendar days prior to the end of the contract year (i.e., October 1) and ends on December 31 of the same year.
  • You want to move from a Program of All-Inclusive Care for the Elderly—PACE—to a Medicare Prescription Drug Plan.
  • You live in—or are moving in or out of—a skilled nursing facility, nursing facility, intermediate care facility for the mentally retarded, psychiatric hospital or unit, rehabilitation hospital or unit, long-term care hospital or swing-bed hospital.
  • Your Medicare entitlement determination is made retroactively.
  • You are not eligible for premium free Part A and enroll in Medicare Part B during the January-March Part B General Enrollment Period.
  • You have a low-income subsidy.
  • The federal government may authorize other special election periods.

*To avoid a penalty, individuals must apply for Medicare Part D within 63 days of losing “creditable” prescription drug coverage, which is coverage that is at least as good or better than the standard benchmark level of Medicare Part D Prescription Drug coverage as determined by the individual’s coverage provider.

Can I change my Part D plan after I enroll?

Once enrolled in a Medicare Part D Prescription Drug Plan individuals can only change their plan from October 15 to December 7 of each year, with an effective date of January 1 of the following year.

Important Medicare Part D Dates to Remember

October 15 

Annual Election Period begins. First day you may elect to enroll in a Medicare Part D Plan, effective next calendar year.

December 7

Last day you can enroll or change Medicare Part D Prescription Drug plans for the next calendar year, unless you qualify for an exception.

January 1 

First day you can use your Part D Prescription Drug Plan (PDP) card for that plan year.

Some categories of beneficiaries are not bound by the lock-in rules and may enroll or disenroll from a PDP plan in other than the AEP. An individual may at any time, during a designated Special Election Period (SEP), discontinue the election of a PDP plan offered by an PDP organization and change his or her election to original Medicare or to a different PDP plan. Examples of situations which may entitle an individual to an SEP include the termination or discontinuation of a plan, a change in residency out of the service area, the organization violating a provision of a contract or misrepresenting the plans provisions, or the individual meeting other exceptional conditions as CMS may provide. CMS has also designated an SEP for individuals entitled to Medicare A and B and who receive any type of assistance from Title XIX (Medicaid), including full-benefit dual eligible individuals, as well as those eligible only for the Medicare Savings Programs. This SEP lasts from the time the individual becomes dually eligible until such time as they no longer receive Medicaid benefits. Individuals who are eligible for an SEP under the guidance for Part D enrollment and disenrollment may use that SEP to also make an election into or out of an MA-PD plan.

from Medicare.govPrescription Drug Coverage (2020)Prescription Drug Coverage: Basic Information (2020)

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