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Medicare Part D — Prescription Drug Coverage

As a Medicare beneficiary, you don’t automatically get prescription drug coverage. This Medicare Part D coverage is optional, but can be valuable if you take medications. If you don’t sign up when you’re first eligible, you might have to pay a late enrollment penalty if you decide to enroll later.

Many people are automatically enrolled in Original Medicare, Part A and Part B, when they reach 65 years of age or collect disability benefits for a certain length of time. But Original Medicare doesn’t cover your medications (except those you may receive as a hospital inpatient or, in some cases, outpatient).

You can get Medicare prescription drug coverage in two different ways. Both of these are through private insurance companies that contract with Medicare.

  • Through a stand-alone Medicare Part D plan—you can add this benefit to your Original Medicare coverage. You can enroll in any Part D plan that serves the area where you live.
  • Through a Medicare Advantage Prescription Drug plan—you can get a Medicare Advantage (Part C) plan that includes drug coverage, so that you get all your Medicare benefits under one plan.

When can I sign up for Medicare Part D coverage?

You don’t have to purchase Medicare Part D coverage. That decision will not affect the other coverage you have, but it may be beneficial for you to enroll in a prescription drug plan when you’re eligible. If you choose to enroll later, you’ll have to pay a higher premium for a Medicare Part D plan, unless you can show Medicare that you had drug coverage at least as good as theirs during the time you were not enrolled in Part D. This is known as “creditable prescription drug coverage.”

You must first have Medicare Part A or Part B to qualify for Medicare Part D coverage. The best time to sign up for Medicare prescription drug coverage is usually as soon as you’re enrolled in Original Medicare, during your Initial Enrollment Period (IEP).

You can also sign up for Medicare Part D coverage during the Annual Election Period (sometimes called the Open Enrollment Period), which runs from October 15 to December 7. During this time period, anyone with Original Medicare, Part A and Part B, can enroll in a Medicare Part D plan or change from one drug plan to another. You can also join a Medicare Advantage Prescription Drug plan during this period.

There are some situations that qualify you for a Special Election Period, when you can join a Medicare Part D plan or a Medicare Advantage Prescription Drug plan outside of the regular periods.

What’s the coverage gap, and how can I avoid it?
The coverage gap refers to a point in the Medicare Part D plan when you and your plan have spent a certain total amount on your prescriptions; this means you’ve reached the end of your initial coverage period. Now you’re in what’s known as the coverage gap, or “donut hole.” During this period, you pay a higher portion of your prescription drug costs. After you’ve spent a certain amount, you’ll reach the catastrophic coverage phase of the plan, and you’ll pay only a small copayment or coinsurance for your medications for the rest of the year.

There are a number of things you can do to help reduce your drug costs. For example:

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  • Switch to lower-cost drugs. Talk to your doctor about using generic and/or over-the-counter drugs. Many generic drugs work as well as costly brand-name prescriptions, and this could save you money each year and keep you out of the coverage gap.
  • Ask your plan about prescription mail-order programs. They can save you money on medications.
  • Always use your Medicare drug plan membership card when you get your medications. When using your card, you may be able to get discounted rates on the drugs you buy, and any money spent on drugs automatically counts toward your deductible.
  • Look for programs that offer assistance. The National Patient Advocate Foundation or the National Organization for Rare Disorders may have programs that can help with your drug costs. Comprehensive information on federal, state and private assistance programs in your area is available from the National Council on Aging.

What does Medicare Part D cost?
Your actual drug plan costs will vary depending on the prescriptions you use, the plan you choose, whether you go to a pharmacy in your plan’s network, whether your drugs are on your plan’s formulary (drug list), and whether you get Extra Help paying your Medicare Part D costs.

Most drug plans charge a monthly premium that varies by plan. You pay this in addition to the Medicare Part B premium. If you belong to a Medicare Advantage plan (like an HMO or PPO) that includes Medicare prescription drug coverage, the monthly premium you pay to your plan may include an amount for prescription drug coverage.

In addition to your monthly premium, your costs for Medicare Part D coverage may include:

  • An annual deductible – This is the amount you pay for your prescriptions before your plan starts to share in the costs. Deductibles vary by plan, and it may be possible to find one with a $0 amount.
  • A copayment/coinsurance – This is the amount you pay out of pocket each time you buy a prescription. These costs can vary from plan to plan, and also vary depending on drug tiers and which stage of the benefit you are in at the time of purchase. Drugs in a higher tier tend to cost more than those in a lower tier.


Can I get Extra Help if I have a low income?
If you have limited income and resources, you may have been automatically enrolled in an Extra Help program (this may vary state to state). If you haven’t been automatically enrolled, you may still qualify for Extra Help from Medicare. If you qualify, you’ll get help paying for your Medicare drug plan’s monthly premium, deductible, and copayments.

You automatically qualify for help if you meet one of the following criteria:

  • You get full coverage from a state Medicaid program.
  • You get help from Medicaid paying your Medicare Part B premium (through a Medicare Savings Program).
  • You get Supplemental Security Income (SSI) benefits.

If you automatically qualify for Extra Help but don’t join a Medicare prescription drug plan yourself, Medicare will enroll you in a plan so that you’ll get help paying for your prescription drugs (Medicare will send you a letter letting you know when your coverage begins). However, if you have certain retiree drug coverage from a former employer or union, Medicare will not automatically enroll you in a plan. For more information, contact your local Social Security office, or call 1-800-MEDICARE (1-800-633-4228). TTY users should call 1-877-486-2048. You can talk to a customer service representative 24 hours a day, 7 days a week.

As I said above, you can enroll in or change your prescription drug coverage during the Medicare Annual Election Period, and I can help you with that. Learn more about me by clicking on the orange button below my photo. Or, use the links below to schedule a phone appointment or have me email you Medicare information tailored to your needs. To take a closer look now at plans that can cover your prescription needs, use the Find Your Plan button–it’s the blue button on the right side, higher up on this page. Or, to discuss your Medicare needs with a human being, call eHealth at 1-844-847-2659; TTY users, call us at 711.

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