What’s new with Medicare Part D in 2018?

Pamela Cannaday by Pamela Cannaday | Licensed since 2011

This article was updated on: 09/15/2018

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If you have Medicare Part D (prescription drug coverage) or plan to enroll in a stand-alone Medicare Part D Prescription Drug Plan, you may be interested in several cost-related trends in 2018.

Medicare Part D premium may decline

In its August 2017 news release, the Centers for Medicare and Medicaid Services (CMS) announced it expects a slight decline in the average monthly Medicare Part D premiums in 2018. CMS estimates 2018 Medicare Part D premiums to average $33.50 per month, compared with $34.70 a month reported in 2017.This premium decline will be the first for Medicare Part D since 2012.

However, note that your 2018 stand-alone Medicare Part D Prescription Drug Plan premium might not be $33.50 per month. This is because premiums vary depending on where you live, what plan you select, and whether you qualify for help paying your Part D premium.

Medicare Part D deductible caps at $405

Stand-alone Medicare Part D Prescription Drug Plans may charge an annual deductible. The federal government sets a limit on the Medicare Part D deductible each year. For 2018, a Medicare Part D plan cannot set a deductible higher than $405, which is $5 over the maximum Medicare Part D deductible in 2017.

Keep in mind that many stand-alone Medicare Part D Prescription Drug Plans do not charge the maximum allowed deductible, which is $405 for 2018. Some plans have a lower deductible. Other plans may have no deductible.

Medicare Part D coverage gap narrows

If the total cost of your prescriptions reaches a certain amount— set each year by the federal government — you pay more for your prescriptions. This is the Medicare Part D coverage gap, also known as the “donut hole.” In 2018, once you and your plan have spent $3,750 on your prescription drug costs, you will be in the coverage gap. (That’s $50 more than the 2017 amount.) At that point, you will pay 35% of the cost of brand-name prescriptions and 44% of the cost of generic medications until the total cost of your covered medications reaches $5,000 (again, $50 more than the 2017 amount). If you reach that limit, you will pay a small amount for your covered prescription drug costs for the rest of the year. The Medicare Part D coverage gap has been narrowing each year since Congress enacted the Affordable Care Act in 2010. The coverage gap will close in 2020.

What does Medicare Part D cover?

Medicare Part D helps cover outpatient prescription drugs. Each plan has its own formulary, or list of drugs the plan covers, so not every plan will necessarily cover the same medications. A plan’s formulary may change at any time. You will receive notice from your plan when necessary.

Every fall, your Medicare Part D Prescription Drug Plan will send you an Annual Notice of Coverage that tells you about any coverage changes for the next year. You may want to review your plan coverage. If you want to switch to a different plan, the Medicare Annual Election Period is one opportunity to do so.

Medicare Part D also may cover some self-injected medicines, such as insulin for diabetes. But if you go to a doctor’s office or other outpatient facility to receive, for example, chemotherapy, dialysis or other medicines that are injected or given intravenously, Medicare Part B — not Part D —may help pay for those treatments. Medicare Part D does not typically cover over-the-counter medications.

If you have a low income, you might be eligible for Medicare Part D Extra Help or the Part D income-related monthly adjustment amount (IRMAA).

Do you have other questions about Medicare Part D prescription drug coverage or need help finding a Medicare Part D Prescription Drug Plan that may suit your needs? I am happy to help you. Use the links below to schedule a phone call with me or to ask me to email you information. You can use the Compare Plans button on this page if you are exploring Medicare coverage options.

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