Medicare Part D Prescription Plans


The current Medicare Part D Prescription Plans or PDPs were an outgrowth of the 2003 Medicare Prescription Drug, Improvement, and Modernization Act (also called the Medicare Modernization Act or MMA) passed by Congress in 2003.


In the original model for PDPs, Medicare beneficiaries were to pay approximately a $35 per month premium, a $250 deductible, and 25% of the total drug costs between $250 and $2,250. All PDPs were to be offered through private insurance companies. There were no Part D plans offered or run by Medicare or the government itself.


Medicare allowed the insurance companies to come up with other models for PDPs. For example, some plans do not have a deductible. Instead, they have set up tiers, or various copay levels for generics and brand name prescriptions. This is still the case today.


For additional details of the original set up, please refer to a 2005 government agency publication titled THE MEDICARE PRESCRIPTION DRUG BENEFIT (PART D) Fact Sheet . Please keep in mind that the numbers shown on this sheet are NOT current.


Medicare and You - Medicare.govFor current information about Part D plans, please refer to pages 87-102 of the 2014 Medicare and You booklet published by the Centers for Medicare and Medicaid Services (CMS).


Beginning in 2011, some of the insurance companies offering part D plans initiated a new trend. Formerly, we had network and non-network pharmacies only. Your copays were what they were at a network pharmacy. Your plan was not accepted at a non-network one.


Now, a few of the insurance companies have aligned themselves with a national pharmacy chain(s). These are known as “preferred” pharmacies. How do you know if the plan uses preferred pharmacies? When you do a drug search on Medicare.gov, you will see one of two designations under of the listing for each plan. They are as follows:


Pharmacy Status:
Preferred-Network


OR...


Pharmacy Status:
Network


If you see the words “Preferred-Network”, that tells you the plan uses preferred and non-preferred network pharmacies. In general, your copays are lower at a preferred pharmacy.


Medicare.gov now requires you to choose a pharmacy when running your prescriptions on their site. If you select a pharmacy that is not a “Preferred” pharmacy with any Part D plans, then your search may not show you the plans that are the best buy if you do use a preferred pharmacy. The work-around is to select Walmart (even if you do not shop there), Walgreens, or even CVS. Doing so will pull up the plans using that particular pharmacy as a preferred pharmacy.


A good strategy is to run your prescriptions using different pharmacy scenarios. Let’s say you live in Missoula, Montana and buy your prescriptions from Albertsons. Select Albertsons pharmacy and run your results. Go to “edit” and run your prescriptions again. This time, choose Walmart or Walgreens. See if one of the plans using a preferred pharmacy shows up as being more competitive.


For more details concerning PDPs, please call 1-800-MEDICARE (1-800-633-4227), visit Medicare.gov or consult with the 2014 Medicare and You booklet.


For assistance in running you meds on Medicare.gov, please consult with your insurance professional or another knowledgeable person.





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