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Unfortunately, under Original Medicare, Part A and Part B, there is very limited prescription drug coverage. In general, Medicare doesn’t cover medications you take at home on your own. There are a few exceptions, such as prescription drugs you use in combination with durable medical equipment such as a nebulizer machine or insulin pump. Medications that are infused or injected, either by you yourself or by a health worker who comes to your home, may also be covered under Original Medicare. Oral cancer prescription drugs and medications you use to manage the side effects of chemotherapy may also be covered under Part B.
While you’re in the hospital or a skilled nursing facility, Part A generally provides prescription drug coverage for any medications you need as an inpatient. It also covers medications you are prescribed while under hospice care.
However, there is no prescription drug coverage under Original Medicare for the majority of the medications your doctor prescribes.
How do I get Medicare prescription drug coverage?
In 2003, President Bush signed the Medicare Prescription Drug Improvement and Modernization Act, which paved the way for Medicare Part D, which became fully available in 2006. Part D was designed to provide prescription drug coverage for people enrolled in the Medicare program.
You can get Part D prescription drug coverage in one of two ways, either by enrolling into a stand-alone Prescription Drug Plan to complement Original Medicare, or a Medicare Advantage plan with prescription drug coverage. The majority of Medicare Advantage plans do include Part D prescription drug coverage.
It’s important to note that Part D plans are not provided through the federal government, but are offered by private insurance companies that contract with Medicare to provide prescription drug coverage. All plans must offer the minimum level of benefits required by the Medicare program, but they can structure their plans differently to meet the needs of their members.
For example, premiums are set by the insurance company, and you will pay them separately from your Medicare premiums, unless you have a Medicare Advantage plan with Part D included, in which case, your prescription drug coverage is included in your plan premium.
All Part D plans use a formulary, or list of covered medications and the benefits they pay for each one. Insurance companies may change their formularies from time to time, but when they do, they are required by law to notify you in advance of any change that may affect you.
Your plan may or may not have an annual deductible. Most plans use a tiered system of copayments or coinsurance, which means that you’ll pay less out-of-pocket for lower priced generic drugs than for more expensive brand-name medications. Some Part D plans also offer discounts or assistance with over-the-counter medications in addition to prescription drug coverage.
It’s a good idea to shop around and compare Part D Prescription Drug Plans, especially if you take prescription drugs on a regular basis. You can use our shopping tool to enter the medications you take to see how they are covered under various plans.
When can I enroll in Part D prescription drug coverage?
Enrollment in Part D prescription drug coverage is optional; you are not required to enroll . However, if you don’t choose a plan when you are first eligible, and you don’t have prescription drug coverage through another source that is at least as good as Part D, you may pay a late-enrollment penalty with your monthly premium for as long as you are enrolled in a Part D Prescription Drug Plan. Under Medicare rules, if you go more than 63 days without creditable prescription drug coverage, you are subject to the late-enrollment penalty.
You have to have Part A and/or Part B to be eligible for Part D prescription drug coverage. The Initial Enrollment Period for Part D is the same as your Initial Enrollment Period for Medicare, which is the seven-month period that begins three months before your 65th birthday month and ends three months after.
If you don’t enroll during your Initial Enrollment Period, you’ll have to wait until the Annual Open Enrollment Period of October 15th through December 7th each year. This means you may go a long time without prescription drug coverage, during which time you’ll have to pay for your prescription medications out-of-pocket.
In certain situations, you may be able to enroll into a Part D prescription drug coverage during a Special Enrollment Period if you have a qualifying event, such as moving outside your plan’s service area.
Need more information about Medicare Part D prescription drug coverage?
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