What to Know About Medicare Part D

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Medicare, the federal health insurance program designed primarily for adults ages 65 and older, is an alphabet soup of parts. Medicare Parts A and B, also known as "original Medicare," are standard coverage, but what about Part D, the prescription drug coverage portion?

If you’re trying to determine whether it makes sense for you to add Part D to your Medicare coverage plan, read on for more information about what it is and what it can do for you.

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Medicare Part D is a voluntary benefit offered by private insurance companies to cover some or all of the cost of many prescription drugs.

“Original Medicare covers some drugs that might be administered in a hospital or doctor’s office setting, but Part D covers the kinds of drugs you might pick up from the pharmacy. If you’re signed up for a Medicare supplement plan, that also works alongside your Part D prescription drug plan,” explains Whitney Stidom, vice president of Medicare operations with eHealth Inc., a health insurance broker and online resource provider headquartered in Santa Clara, California.

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Medicare Part D covers a set list of prescription drugs. This list, called a formulary, can differ from year to year and depends on the specifics of your Medicare plan selections.

Both brand-name and generic medications are covered, and the formulary usually covers at least two drugs among the most commonly prescribed categories and classes. That helps ensure that people with various medical conditions can get the medications they need at a reasonable cost.

In some cases, the formulary might not cover a certain drug that a beneficiary needs. Usually, however, a similar or generic version of that medication is available. If there is no analogous drug in your formulary, you or your doctor can request an exception by submitting documentation of your need along with additional information to Medicare.

The copay you need to contribute can fluctuate as prices and benefits change, so be sure to check the list of what’s covered and what your copayment responsibilities will be during each annual enrollment period.

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Many Medicare Part D plans classify drugs according to a tiered system. This approach can help lower costs, as each tier costs a different amount. Usually, the lower the tier number, the less the medication will cost you out of pocket.

These tiers vary from plan to plan, but a typical plan usually includes:

If your........

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