What is a Medicare Part D Preferred Pharmacy?
This article was updated on: 09/15/2018
You can enroll in a Medicare plan that offers Part D prescription drug benefits in order to receive prescription drug coverage. There are two types of plans offered by Medicare-approved private insurance companies that provide Medicare Part D prescription drug benefits:
- A stand-alone Medicare Part D Prescription Drug Plan that works alongside your Medicare Part A and Part B coverage, or
- A Medicare Advantage Prescription Drug plan that combines benefits for the medical and hospital services covered by Medicare Part A and Part B with Medicare’s Part D prescription drug coverage.
What are Medicare Part D pharmacy networks?
When you enroll in a Medicare Part D, your plan will offer a network of contracted pharmacies where you can fill your prescriptions. Pharmacy networks may include one or more of the following:
- A mail-order pharmacy can fill most prescriptions for medications you take regularly. Depending upon your doctor’s order, you may be able to receive a 30- 60- or 90-day supply of medication for a single copayment. Your prescription medications are delivered by mail.
- Retail pharmacies may include chain drug stores, grocery stores, discount retail stores, and/or local independent pharmacies.
- “Preferred” pharmacies are included in many Medicare plans providing Medicare Part D prescription drug coverage. A “preferred” pharmacy refers to a subset of retail pharmacies within a plan’s network that agree to charge plan members covered prescription drugs at a reduced copay or coinsurance. If you select a Medicare Part D Prescription Drug Plan or Medicare Advantage Prescription Drug plan that has preferred pharmacies, your out-of-pocket costs may be lower than a standard network pharmacy.
How does my choice of “preferred” pharmacy or standard pharmacy affect my prescription drug costs?
Usually Medicare plan’s prescription drug benefits are designed so that the plan pays the cost of your covered medication at any network pharmacy. You may have to pay a copayment or coinsurance, after you have met the annual deductible (if the plan has one). By using a preferred pharmacy, you may be able to save money. Your added savings comes from the lower copayment or coinsurance you pay (the preferred cost-share) at preferred pharmacies.
Using preferred pharmacies can work in your favor two ways:
- First, using preferred pharmacies may lower your prescription drug costs.
- Second, lower prescription drug costs may help you delay reaching the Coverage Gap (or donut hole) if you take many medications and/or expensive brand-name prescription drugs.
How do I choose a Medicare plan offering Part D prescription drug coverage?
Keep in mind that Medicare plans offering Part D prescription drug coverage set their monthly premiums, design their benefits, and contract with pharmacies. Costs, benefits and pharmacy networks often vary by plan. Therefore, it’s wise to compare the Medicare Part D Prescription Drug plans that are available to you. Check to make sure your medications are on the plan’s formulary (list of covered prescription drugs). You may also want to verify whether or not the plan has preferred pharmacies and what other cost-savings features the plan has to offer you.
Do you have other coverage questions about Medicare Part D prescription drug coverage or preferred pharmacies? I am happy to assist you in understanding your Medicare Part D prescription drug benefits or to help you identify Medicare plans that include preferred pharmacies.
- To get more Medicare plan information to review, use the links below; you can schedule a phone call with me or have me email you plan options available through eHealth.
- If you’d like to compare some of the Medicare plans, use the Compare Plans button on this page.