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Learning Center > What Is Medicare Part D And What Drugs Are Covered?

What Is Medicare Part D And What Drugs Are Covered?

What Is Medicare Part D And What Drugs Are Covered?

Before the Medicare Part D program started in 2006, thousands of Medicare beneficiaries faced high price tags on drugs and had little help with curbing those costs. But now, Medicare Part D plans, also known as Medicare Prescription Drug Plans, give Medicare beneficiaries prescription drug coverage options.

How Does Medicare Part D Work?

Medicare Part D is a prescription drug plan added to your Original Medicare plan (Parts A and B). The monthly premium may vary between Part D plans, and higher-income beneficiaries may pay more per month.

There are a lot of common questions about Medicare Part D, and this article will help you answer them so you can choose the plan that’s best for you.

So if you’re soon becoming eligible for Medicare Part D plans, or thinking about switching your existing Medicare coverage, this Medicare Part D guide will cover all the basics and answer your questions, including:

  • What is Medicare Part D?
  • Who is eligible for Medicare Part D?
  • When can you enroll in Medicare Part D?
  • What does Medicare Part D cover?
  • How does Medicare Part D work?
  • How much does Medicare Part D cost?
  • How can I get help with Medicare prescription drug costs?
  • What is the Part D Senior Savings Model?
  • Tips to shop for Medicare Part D plans

What Is Medicare Part D?

Medicare Part D is one of the four “parts” of the Medicare program. Under Original Medicare, also known as Medicare Parts A and B, only very limited drug coverage is provided. Any medications covered are generally restricted to medicines that must be administered by a doctor.

So as we mentioned before, the Medicare Part D program was created to help combat the high cost of prescription drugs.

Medicare Prescription Drug Plans (PDPs) are available through private insurance companies. These plans help Medicare beneficiaries with the cost of medications, and are available in 2 forms:

  • Standalone Prescription Drug Plans (PDPs)
  • Medicare Advantage Prescription Drug Plans (MAPDs)

Standalone Medicare drug plans work with Original Medicare. You stay enrolled in Medicare Part A and/or B, and obtain your prescription drug coverage through a Part D plan from a private insurance company.

An MAPD plan is an alternative to the Original Medicare program, and combines all the benefits of Medicare Part A and B with drug coverage. All these benefits are provided by a private insurance company.

Many private insurance companies provide Medicare Part D drug plans, including large nationally known ones and smaller, local companies. You can get Medicare Part D drug coverage in all 50 States.

Who Is Eligible For Medicare Part D?

Medicare Part D eligibility depends on meeting two criteria. To be eligible, you must be either:

1) Enrolled in Medicare Part B, or entitled to Medicare Part A; and 2) Live in the plan service area.

If you qualify for Medicare Part A or are actively enrolled in Medicare Part B, then you can sign up for a standalone Medicare Prescription Drug Plan.

Note: You must have both Medicare Part A and B if you want to enroll in Medicare Advantage.

Medicare PDPs are a great fit for those who are Medicare-eligible and don’t have other creditable drug coverage. Examples of other creditable drug coverage include:

  • Employer or retiree coverage
  • Union coverage
  • Certain military coverage, like VA benefits or Tricare, may provide good drug coverage. But they may not meet the criteria of “creditable coverage."

Do I Qualify for Medicare Part D?

To qualify for Medicare Part D, you need to have Medicare Parts A or B while also living in the service area of the Part D plan you are interested in.

You’ll have to shop around for Part D plans because there are different options available depending on where you live. Ensure that the plan you choose makes sense based on your medical and prescription needs.

You cannot be denied Medicare Part D due to health conditions, the number of prescriptions you take, or the cost of your prescriptions.

However, you might be denied coverage in a Part D plan for other reasons:

  • Your Medicare eligibility can’t be confirmed
  • You don’t live in the plan’s service area
  • You didn’t apply during an available enrollment period
  • You have creditable drug coverage from an employer, union, or pension and didn’t reply to the letter about how Plan D could affect that coverage
  • The Part D plan asked for additional information about your enrollment and you didn’t respond within timely

Keep in mind that if you take a large number of prescriptions, you need to carefully choose a Part D plan that includes all of them in its covered formulary.

Medicare Part D Enrollment Periods

Can I sign up for Medicare Part D at any time? Unfortunately not. However, there are a couple of times per year that allow enrollment, and you may qualify for a special enrollment period at other times.

It’s important to join Medicare Part D when you’re first eligible unless you have other creditable coverage. Otherwise, you may have to pay a lifetime late enrollment fee for Part D when you do enroll.

Medicare Initial Enrollment Period

You generally have an initial enrollment window when you first become eligible for Medicare Part D. This first enrollment window is known as your Initial Enrollment Period (IEP), which lasts for seven months that include:

  • Three months before the month you become eligible for Medicare
  • The month you become eligible for Medicare
  • Three months after the month you become eligible for Medicare

Note: Your IEP lasts for seven months, regardless of whether you’re entering Medicare because you turn 65, or if you will enter due to permanent disability.

If you have other creditable drug coverage, like from an employer or spouse’s employer, then you can delay enrollment into Part D without being subject to a penalty. Be sure that your drug coverage is considered creditable though.

If you enroll in Medicare Part D after your IEP and don’t have other creditable drug coverage, then you will be subject to a late enrollment penalty. You can be subject to this penalty for either of 2 reasons:

  • You had no drug coverage at all after becoming eligible for Medicare.
  • You had drug coverage from another source, but it wasn’t considered creditable by Medicare.

Your late enrollment penalty will increase for each month that you go without creditable coverage. So it’s very important to get Medicare Part D drug coverage as soon as you’re eligible, or make certain that your non-Medicare drug plan will satisfy Medicare coverage requirements.

Medicare Part D Special Enrollment Periods

Beyond your IEP, you may qualify for a Special Enrollment Period (SEP) that will allow you to enroll in, or change, your Medicare Prescription Drug Plan. Generally, you’ll qualify for an SEP when you experience abrupt changes in your circumstances. Some common SEPs include:

  • Moving out of your plan’s service area.
  • Losing creditable drug coverage from your employer.
  • Your Medicare Drug plan doesn’t renew its contract with the Centers for Medicare & Medicaid Services (CMS).

During a Special Enrollment Period, you generally will only have one chance to enroll in a Medicare Part D drug plan.

Medicare Annual Enrollment Period

Everyone eligible for Medicare can enroll in or switch Medicare Part D plans during the Annual Election Period (AEP), also called the Medicare Open Enrollment Period.

AEP runs from October 15 to December 7 each year. If you enroll in a plan during this window, your coverage will be effective on January 1 the following year. During the Medicare AEP, you can:

  • Change from one Prescription Drug Plan to another PDP.
  • Switch from a Medicare Prescription Drug Plan to a Medicare Advantage Prescription Drug Plan (MAPD).
  • Switch from one Medicare Advantage Prescription Drug Plan to another MAPD.
  • Switch from Original Medicare to an MAPD.
  • Drop your MAPD plan and return to Original Medicare with the option to add a standalone drug plan.

Medicare Advantage Open Enrollment Period

If you’re enrolled in a Medicare Advantage plan, you have access to an additional enrollment window: the Medicare Advantage Open Enrollment Period (MA-OEP).

The MA-OEP is from January 1 to March 31 each year. During the MA-OEP, you can:

  • Switch from one Medicare Advantage plan to another with or without drug coverage.
  • Drop MAPD and return to Original Medicare. You’ll get a chance to enroll in a standalone Medicare Part D plan if you do this.

What is Covered by Medicare Part D?

Medicare Prescription Drug Plans provide coverage for many prescription drugs. These Medicare PDPs are required to cover certain kinds of medications and prohibited from covering others. Generally, medications that are approved for therapeutic use are covered by Part D.

It’s important to know, however, that Medicare Part D plans are not required to cover every drug that’s on the market. Instead, Medicare drug plans are allowed to choose which drugs they will cover. There are certain requirements that plans must use when they create their lists. The list of covered drugs is known as a formulary. Because of this freedom, each plan’s formulary is unique.

Every Medicare drug plan formulary is organized into tiers. Each tier includes certain kinds of drugs in the following manner:

  • Tier 1 – generic drugs
  • Tier 2 – preferred brand name drugs
  • Tier 3 – non-preferred brand name drugs
  • Tier 4 – specialty drugs

What Drugs are Not Covered by Medicare Part D?

Some drugs are never covered by Medicare. In many cases, this is because the drugs are considered elective and not deemed medically necessary.

Drugs that no Medicare Part D plan covers include:

  • Drugs to treat anorexia, weight loss, or weight gain (unless physical wasting caused by AIDS, cancer, or other illness)
  • Fertility drugs
  • Cosmetic drugs and medication for hair growth (note: prescriptions to treat medical conditions like psoriasis, acne, rosacea, or vitiligo are not considered cosmetic)
  • Drugs for the relief of cough or cold symptoms
  • Prescriptions to treat erectile disfunction
  • Prescription vitamins and minerals, unless prescribed for pregnancy
  • Over-the-counter drugs that don’t have a prescription
  • Drugs that do not meet the FDA’s Drug Efficacy Study Implementation (DESI) standards

Some drugs have multiple purposes, and a drug that’s approved by the FDA to treat a specific health condition you have may be covered even if it falls into one of the above categories.

How Much Does Medicare Part D Pay for Prescriptions?

How much Medicare Part D pays, and how much you pay out-of-pocket for prescriptions, will depend on the exact plan you choose. Each plan will have a formulary and will divide prescription drugs into tiers.

Lower tiers are generally for generic drugs and inexpensive prescriptions, and you’ll pay less of a copayment or coinsurance for those. Higher tiers are for name-brand and expensive drugs, and you’ll pay more for those.

The amount your plan pays will also depend on what phase of Plan D you’re in: paying the initial deductible, the initial coverage phase, the “donut hole”, or the catastrophic coverage phase.

There is no Part D limit on the number of prescriptions you fill, either in a year or over your lifetime. These will be based on your medical needs as determined by your doctor.

Are Vaccines Covered by Medicare Part D?

Medicare Part D covers many vaccines, including:

  • Hepatitis B (if you are not considered intermediate or high risk for Hepatitis B)
  • Shingles
  • Tdap (tetanus) boosters

Note: While Medicare PDPs do not cover flu or COVID-19 vaccines, they are covered by Part B.

How Much Does Medicare Part D Cost?

You pay a monthly premium to the insurance company for Medicare Part D coverage. In exchange, you pay less for many prescription drugs than if you paid cash at the pharmacy.

You will likely pay some or all of these costs under Part D:

  • Annual deductible
  • Copayments
  • Coinsurance

If your plan has a Medicare Part D deductible, you’ll pay the full price for medications until you’ve met the deductible. For 2021, the maximum Part D deductible is $445.

While many PDP plans don’t have an annual deductible, most do, and the average 2021 Medicare Part D deductible across all Part D plans is expected to be around $345.

For those plans without deductibles, you would pay a copayment or coinsurance amount for medications starting with your first prescriptions.

Premiums for higher-earning Medicare beneficiaries can be higher. Thanks to IRMAA (Income Related Monthly Adjustment Amount), you can expect to pay higher premiums for Medicare Part D coverage if you are single and have an adjusted gross income over $88,000, or if you file jointly and have gross income greater than $176,000.

The additional cost of Part D coverage increases in several income bands:

  • The first IRMAA band adds $12.30 per month to the cost of your Medicare Part D coverage.
  • The highest band for single incomes over $500,000 and joint incomes above $750,000, adds an additional $77.10 per month to the cost of your Part D drug coverage.

How Do Medicare Part D Costs Work?

The amount you pay for a medication changes during the year, depending on your coinsurance, copay, and how much you and your plan have paid for prescriptions.

Your Medicare Part D costs change as you move through four coverage stages.

What are the 4 Phases of Medicare Part D Coverage?

Medicare utilization is fluid over the course of the year, depending on how much you use prescription drug coverage. Keep in mind that you may not hit all of these phases every year, especially if your drug costs are lower.

The phases exist because you have a deductible to cover before Medicare Part D kicks in, and then there are maximums for regular coverage each year. The list below describes each phase of Medicare Part D coverage.

  • Annual Deductible Stage – you pay full price until you’ve paid $480 (for 2022).
  • Initial Coverage Stage – you pay a small copayment or coinsurance for each prescription until the amount you pay plus what your plan pays hits $4,130 (2021 amount).
  • Coverage Gap Stage (also known as the Medicare donut hole) – you pay 25% of the total cost for both generic and brand name drugs.
  • Catastrophic Coverage Stage – once your total costs, plus the value of manufacturer discounts exceeds $6,550, then you pay no more than 5% of the cost for any medications for the rest of the year.

You begin each year at the first coverage stage and move through them as the year progresses.

Note: Only drugs on your plan’s formulary count against these coverage stages, so it’s very important that you find a Part D plan that covers your medications.

How To Get Help With Medicare Prescription Drug Costs

While your Medicare drug plan can help with the cost of medications, you may still find prescriptions to be unaffordable. While there are several possibilities for obtaining lower-cost medications, the first place you should look is the Extra Help Program, also known as the Part D Low Income Subsidy program.

Extra Help is provided and designed to help people with limited incomes pay for the costs of prescription drugs, including:

  • Premiums
  • Deductibles
  • Coinsurance/copayments

Extra Help benefits are available for those with limited means - both an overall asset or resource limit and an income limit. These limits depend on your marital status.

The resource limit does not count the value of your personal residence, vehicles you own, or certain other assets. But the income limits are:

  • $19,140 for single individuals
  • $25,860 for married households

Depending on the level of Extra Help you receive, you can expect to pay significantly less on prescriptions. At the full subsidy level, you’d pay no more than $3.70 for each generic drug filled, and no more than $9.20 for each brand name drug prescription filled.

What Is The Part D Senior Savings Model?

One of the 2021 changes to Medicare is the Part D Senior Savings Model. This program is a voluntary agreement between CMS and Medicare Part D plan sponsors. And it’s intended to bring down the cost of insulin for millions of Medicare beneficiaries.

Not all Part D plans are participating, but there is at least one participating plan in every state. Enrollees in participating Medicare Part D plans, including both standalone drug plans, and MAPD plans, will pay no more than $35 for a one-month supply of many kinds of insulin. This is expected to save people an average of $446 per year.

Tips To Shop For Medicare Part D Drug Plans

When finding Medicare prescription drug coverage, the first thing to understand is how you’re receiving your Part A and B benefits.

As an example, if you’re enrolled in Original Medicare, combined with a Medicare Supplement plan, then you’ll want to look for standalone Prescription Drug Plans.

But if you’re enrolled in a Medicare Advantage plan or will be, then you’ll want to look for MAPD plans.

But it’s important to know that you typically can’t have a Medicare Advantage plan and a standalone Prescription Drug Plan at the same time, so make sure you know your circumstances.

Once you know what kind of Medicare Part D drug plan you need, you can start to compare Part D plans. You should pay close attention to such details as:

  • Monthly premiums
  • Annual Part D deductibles
  • Availability of the drugs you need on the plan formulary

Tip: Every Part D plan has a different formulary, and two different plans can assign the same medication to two different tiers. So it’s important to look up your medications to get a feel for anticipated out-of-pocket costs for your medications.

Also, if you take insulin, look for a Medicare Part D plan that participates in the Senior Savings Model. This alone can save you hundreds of dollars per year in insulin costs.

Find and Compare Medicare Part D Plans

Medicare prescription drug plans are available to help lower the burden of prescription drug prices for Medicare beneficiaries. Some of our final Part D takeaways include:

  • Be sure to sign up for a Medicare PDP during your Initial Enrollment Period or as soon as your creditable coverage ends to avoid a Part D penalty.
  • Do plenty of research, whether you’re signing up for a Medicare Part D plan for the first time or considering switching during an open enrollment period.
  • Look up all of your drugs to ensure they will be covered.

If this seems daunting, you can get started by using our Medicare plan comparison tool to compare Part D plans and see if your drugs are covered.

You can also call 800-620-4519 to get help from a licensed insurance agent and discuss your Part D options.

What you should read next

Medicare In 2023: Changes & Updates

When planning ahead for your healthcare expenses and how they align with your Medicare coverage, it’s very important to stay informed on the changes to Medicare each year.  Several aspects of Medicare - particularly related to out-of-pocket costs - can change on an annual basis. Beyond costs or plan changes, Congress also occasionally proposes and passes legislation that often impacts Medicare benefits.  In this article, we’ll review the recent changes, including the 2023 Medicare costs and an overall look at the state of Medicare in 2023.  2023 Medicare Costs: An Overview  The Medicare costs that change each year are: Part A deductiblePart A daily coinsurancePart B deductible Medicare Part A CostsThe changes to Part A costs include:Part A deductible - $1,600, an increase of $44 from 2022Part A daily coinsurance for hospital stays over 60 days - $400 per day, an increase of $19 per dayPart A daily coinsurance for hospital stays over 90 days - $800 per day, an increase of $22 per dayPart A daily coinsurance for skilled nursing facility stays longer than 20 days - up to 100 days $200, an increase of $5.50 per month Keep in mind that it is possible to pay the Part A deductible more than once in a year. This would only happen when you have multiple hospital stays in one year, and your stays are separated by more than 60 days. In this situation, you’d pay the Part A deductible each time.When you pay the Part A deductible, that gets you 60 days in the hospital and 20 days in a skilled nursing facility. If your stay goes beyond those times, you’ll have to pay the updated daily co-insurance amounts indicated above. Medicare Part B CostsThe Part B deductible for 2023 decreased to $226. It was $233 for 2022. You have to pay the Part B deductible each year before Medicare starts  paying its portion of your outpatient care. Unlike the Part A deductible, you’ll only be required to pay the Part B deductible once per year.After you’ve met the Part B deductible, Medicare will pay the first 80% of the cost for your care; you’ll be responsible for the remaining 20%. Besides standard Part B coinsurance, you might encounter Part B excess charges, which can be as much as 15% of the Medicare-approved cost for your care.There were no changes to these coinsurance costs for 2023. How Much Will Medicare Premiums Increase in 2023? The standard Part B premium for 2023 is $164.90, which is a decrease of $5.20 per month. This decrease takes some of the sting out of last year’s increase, which was one of the largest in history. You may pay a higher premium for Medicare if you have incomes exceeding $97,000 (single filers) or $194,000 (married filing jointly).In addition to the costs for using your coverage, you’ll also have to consider the cost for getting your coverage. Most people don't have to pay a premium for Part A coverage (because it’s been pre-funded through payroll tax deductions), but you do have to pay a premium for Part B coverage. Medicare Part D Changes Another major component of your Medicare coverage is Medicare Part D, also known as Prescription Drug Plans (PDPs). Part D is offered by private insurance carriers with a Medicare contract - not offered by the federal Medicare program. There have been major changes to Part D in the past year as a result of the Inflation Reduction Act. Some of these changes won’t take effect until 2024 or later, but a few of them will be effective in 2023. The changes that will be applicable for 2023 include:Caps on the cost of certain insulinTaxes on excessive increases in the cost for prescription drugsLowering the cost of many vaccinations covered under Part DEach of these changes will have an impact on both standalone Part D Prescription  Drug Plans (PDP) and Medicare Advantage Prescription Drug Plans (MAPD). New Caps On Insulin PricesThe Inflation Reduction Act has brought us the Insulin Savings Program, which was a temporary “test program” that began in 2020. The program is now permanent and mandatory. But previously, it was optional: Part D plans could choose to participate on a voluntary basis.The Inflation Reduction Act limits monthly cost sharing for covered insulin products to no more than $35 for Medicare beneficiaries, as long as the insulin is on the plans formulary. No deductible will apply to these insulin prescriptions. For 2023 and beyond, insulin prescriptions are capped at $35 for a one month supply. This price level stays the same throughout the year, even if you enter the coverage gap or “donut hole.” Excise Tax On Excessive Cost Increases Cost increases on prescription drugs, which are set by the manufacturers, will be subject to a new tax beginning in 2023. Medicare will use 2022 drug prices as a baseline and will investigate the prices for 2023 prescription drugs. If the increases from 2022 to 2023 are larger than the official rate of inflation, the manufacturer will pay a tax equal to 100% of the amount that the increase exceeded inflation for the year. Drug prices will be tracked each year in this way. The hope is that manufacturers will be less likely to increase prices aggressively since they won’t be able to keep any of the extra revenue that large cost increases used to bring them.While this new policy doesn’t directly reduce or limit the prices you pay through your drug plan, over time, it may allow for smaller copayments and coinsurance for your prescriptions. Reduced Vaccine Costs Under Part D The Inflation Reduction Act is also impacting how much you’ll pay for vaccinations under Part D. Prior to 2023, most non-essential vaccines were subject to cost-sharing, which meant that you had to pay a copayment or coinsurance for them. For example, the shingles vaccine was famously expensive. For 2023 and beyond, many Part D covered vaccines will be available at no cost. This brings the Part D vaccinations into alignment with the rules and cost structure for Part B vaccines (like the COVID-19 and flu shots). This includes the shingles shot, so protecting against this painful illness will be cheaper starting in 2023. There are still vaccines that you’ll have to pay for under Medicare, even after these recent changes. Vaccines that are needed to treat injuries or exposure to certain diseases may still require cost-sharing. General Enrollment Period (GEP) ChangesThe last major change to Medicare in 2023 relates to entering Medicare when you’ve missed your original enrollment window. Most people get to enter Medicare when they turn 65-years-old. In that case, you have a seven-month enrollment period known as your Initial Election Period (IEP) during which you can enroll. If you miss this chance, you have to enroll during the General Enrollment Period (GEP). GEP runs from January 1st to March 31st each year. Previously, if you enrolled during the GEP, your Medicare coverage wasn’t effective until July 1, which left you with a significant gap in your medical coverage.For 2023 and beyond, your coverage will be effective on the first day of the month after you sign up during the General Enrollment Period, eliminating the lengthy waiting period. Learn MoreIf you still have questions about 2023 Medicare costs and how they impact you, call 800-620-4519 to speak to one of our licensed insurance agents. You can also view our Medicare resources online:Compare Medicare plans: Visit our Medicare plan comparison tool.Learn about Medicare: View our Medicare Learning Center.Note: These 2023 Medicare costs and updates are courtesy of the Centers for Medicare & Medicaid Services (CMS). For more information, visit the CMS newsroom. 

10 Costly Medicare Mistakes to Avoid

Researching your Medicare plan and understanding how to use your benefits wisely is key to maximizing your Medicare plan. But if you don't take the time to learn all that your current plan has to offer, or if you avoid comparing Medicare plans when it may be time to make a change, you could end up paying more money for your healthcare.   To help you make an informed choice, we’ve put together this guide about 10 costly mistakes to avoid when picking a Medicare plan.   Mistake #1: Using Doctors And Medications That Are Not Covered By Your Plan Medicare Advantage plans have formal networks of providers and lists of medications that are covered (called a formulary). If you see doctors who aren’t in-network, you’ll be paying more for your care than if you use in-network providers. While some PPO plans will allow you to see non-network providers, you’ll save the most money when you use in-network providers. In the same way, plans only provide coverage for medications that are on the formulary. If you use non-covered medications, you’ll end up paying full price for them. So if your current plan doesn’t work with your doctors and medications, you may want to consider making a change to your coverage a qualifying enrollment period.  Our online guided Medicare enrollment tool also allows you to check and see if your doctor and drugs are covered in a Medicare Advantage plan.   Mistake #2: Not Taking Advantage of Additional BenefitsOne of the reasons Medicare Advantage plans are increasingly popular is because they usually provide benefits that are not covered by Original Medicare. These kinds of benefits can include dental, vision, hearing, or prescription drug coverage.These benefits also may be included in your plan at no additional cost. If you don’t use them, you might be paying more than you need to for these services. In addition to the potential cost savings, these additional benefits are designed to help you live a healthier life. Mistake #3: Paying Cash For Your MedicationsIt can be tempting to pay cash for some of your less expensive medications. This is especially true when you look into any of the various prescription discount card programs that are currently available. However, it's wise to avoid paying for your medications if you're expected to reach the third coverage stage of the Medicare Part D drug program (often called the donut hole). Your drug plan tracks your spending, so if you pay cash for a prescription, it doesn’t count towards your official spending. This means that you might not be able to move out of the donut hole if you pay cash for some of your medications. Instead, consider using your plan even if you’ll pay more, if it means that you’ll move out of the donut hole faster. Mistake #4: Not Understanding Your Plan’s CostsWhile Medicare Advantage plans generally help to limit your healthcare costs, it’s important to remember that there are costs you’ll be expected to pay for your care. These costs are usually referred to as cost-sharing. Cost-sharing can include deductibles, copayments, and coinsurance. Besides these amounts, you’ll want to double check your plan’s Out-of-Pocket Maximum (OOPM), which is the most you could possibly spend in one year.  Mistake #5: Choosing A Plan Based On Premiums AloneIt can be tempting to focus on the monthly premium you pay for your coverage, and not dig deeper into the costs you’ll pay to use your benefits. Pay particular attention to any deductible that you have to meet, as well as co-payments for services you’re likely to use. Besides these, consider your total costs in light of any costs for prescription drugs you take, too. Mistake #6: Not Checking To See If You Qualify For Financial AssistanceThere are a number of federal and state programs that are designed to help you pay for the cost of your health care. These can include Medicaid, Extra Help, Low Income Subsidy, and state pharmaceutical assistance programs. While there are income and asset limits for participation in some of these, you should apply for them if you think there is any chance that you could be eligible. Many times the limits are dependent on household size so you may qualify even if your income appears to exceed the limits. The upside is huge and there’s no downside to applying, so don’t miss out any potential for savings with these programs. Mistake #7: Not Considering Late Enrollment PenaltiesIt’s very important to consider the impact of late enrollment penalties, especially when you’re first entering Medicare. You can potentially be subject to enrollment penalties for both Part B and Part D. These penalties are assessed in the form of an additional monthly premium. Importantly, these penalties are generally permanent; once you’re subject to them, you’ll pay them for the rest of your life.If you’re already in Medicare, and you have avoided late enrollment penalties so far, just make sure that you continue to have Part D drug coverage, either from a Medicare Advantage Plan or a standalone Prescription Drug Plan.Mistake #8: Not Reviewing Changes In Your CircumstancesIt's important to review any changes in your circumstances on an annual basis. If you’ve been referred to a new specialist, prescribed a new medication, or diagnosed with a new medical condition, you might be better served by a different plan for the new year. So be sure to consider the impact these kinds of circumstances may have on your Medicare coverage.  Mistake #9: Automatically Renewing Your Plan Each YearEach year, your plan will mail your Annual Notice of Change (ANOC) before the fall Annual Enrollment Period (AEP). The ANOC outlines changes in your plan benefits or costs for the upcoming year. Use this document, along with your plan’s overall Evidence of Coverage (EOC) to know how to use your benefits for this year.If you don’t make a change during AEP, you’ll automatically stay in your current plan. But plan benefits change from year to year, as do Medicare Advantage plan networks. So it's essential to review your coverage each year. Mistake #10: Not Working With A Licensed Insurance AgentAs you research the plans available in your area, consider working with a licensed insurance agent like one of our TogetherHealth agents. We work with a network of the nation’s major insurance carriers and can provide you with a variety of plan options to fit your healthcare needs, remain in-network with your doctors, and give you strategies to save money on prescription drugs.  Get Help With MedicareIf you need more guidance, call 1-800-620-4519 (TTY 711) to speak to one of our licensed agents and get advice on how to avoid these 10 costly Medicare mistakes.

2023 Medicare Annual Enrollment Period Guide

The Medicare Annual Enrollment Period (AEP), sometimes called Medicare Open Enrollment or the Medicare Annual Election Period, runs from October 15 to December 7 each year. This is the time period in which Medicare-eligible consumers can make certain changes to their Medicare plans. These plan changes would then become effective on January 1. View Our Medicare Annual Enrollment Period Guide Medicare plan costs and benefits can change annually, so it's wise to review your Medicare coverage each year. Use our Guide to the Medicare Annual Enrollment Period as a resource to review your current Medicare plan on an annual basis, then call our licensed insurance agents to compare Medicare plans during AEP.  Medicare Guide to Annual Enrollment Medicare Guide Understand your Medicare plan options and learn what actions to take and when. Download your guide Call to compare Medicare plans: 1-888-605-1433 (TTY 711). Our licensed insurance agents are available to help 7 days a week. Weekdays: 8am – 11pm ET Saturday: 10am – 7pm ET Sunday: 11am – 6pm ET Overview of Medicare Enrollment PeriodsIt's important to know that the Medicare Annual Enrollment Period is different from other Medicare enrollment periods. Here’s a quick overview of the differences:Initial Enrollment Period (IEP): The 7-month initial enrollment period when you can first sign up for Medicare Parts A, B, C or D. This period spans:3 months before your 65th birthdayThe month of your 65th birthday3 months after your 65th birthdayAnnual Enrollment Period (AEP): An election period that allows you to make changes to your Medicare coverage each year. Open Enrollment Period (OEP): Applies only to those with Medicare Advantage, who can change Medicare Advantage plans or drop them and return to Original MedicareGeneral Enrollment Period (GEP): Open enrollment period to join Medicare Part A and B.Special Enrollment Period (SEP): Occurs if you have eligible life changes that mean you need to change your plan before the next annual enrollment period.Be sure to visit our guide to different enrollment periods to learn more.What’s the Difference Between Medicare AEP and the Medicare General Enrollment Period?The Medicare Annual Enrollment Period is sometimes confused with the Medicare General Enrollment period, which is January 1 to March 31 each year. It’s important to understand the differences between the two enrollment periods.The Medicare General Enrollment Period is for Medicare beneficiaries who didn’t sign up for Medicare Part A) or Part B when they first became eligible and aren’t eligible for a Medicare Part B special enrollment period. The AEP, however, is for beneficiaries who are already enrolled in Medicare and want to change their Medicare coverage.What Changes Can I Make During the Medicare Annual Enrollment Period?The first thing to know is that you cannot use the Medicare Annual Election Period to enroll in Medicare Part A or Part B for the first time.If you’re enrolled in Medicare Part A and Part B and you’d like to change your Medicare coverage, here are some things you can do during the Medicare AEP:Change Medicare Advantage plans.Change Prescription Drug (Part D) plans. Enroll in a Prescription Drug Plan.Cancel your Prescription Drug Plan.Switch from Original Medicare to a Medicare Advantage plan.Switch from a Medicare Advantage plan back to Original Medicare (and add a Part D plan or Medicare Supplement plan if needed). 5 Tips to Prepare for the Medicare Annual Enrollment PeriodThere are many Medicare insurance carriers and plan options, but there are several steps you can take to be a savvy shopper and choose the right plan for your unique needs.1. Mark Your CalendarThis may seem like an obvious tip, but it’s worth mentioning: Mark your calendar for October 15 through December 7 if you’d like to make a change to your Medicare plan.You might even set aside a few hours to research and compare Medicare Advantage plans and Prescription Drug plans ahead of October 15. These plans announce their benefits for the next year starting on October 1.Writing down these Medicare AEP dates and to-dos will help you to commit to these priorities.2. Review Your Medicare Annual Notice of ChangeYou’ll receive lots of information over the next month or so prior to and during AEP, so if you’re currently enrolled in a Medicare Advantage or Prescription Drug Plan, the Annual Notice of Change (ANOC) is one piece of mail you’ll want to read.Your Medicare plan will mail your Annual Notice of Change letter to you by September 30. The ANOC letter will inform you of most changes to your Medicare health plan, including coverage and benefits that will take effect on January 1 each year.Each year, your Medicare health plan sets the amounts it will charge you for premiums, deductibles and other services. Medicare doesn’t set these rates - but your insurance company does. With this in mind, the amounts you pay could change each year.While evaluating your current Medicare plan, you may want to ask yourself questions like:Did the plan cover the services I needed?Did I use out-of-network providers?Did I spend more out of pocket than I originally anticipated?Has something changed with my health (new diagnosis, new prescriptions, etc.)?The ANOC will also provide a side-by-side comparison of your current plan and next year’s plan benefits, costs and other changes (if any).Moral of the story: Don’t toss this piece of mail aside. Always review your ANOC to ensure your plan continues to meet your needs on an annual basis. And if you don’t receive your ANOC by September 30, contact your Medicare insurance company.3. Make a List of What’s Important to Your HealthKeeping a list of what’s important to your health is an invaluable way to prepare for the Medicare Annual Enrollment Period.Start by writing down all of your doctors, preferred health care facilities and hospitals, and prescription drugs, if you take any.We also recommend making a list of value-added benefits that may fit your health, lifestyle and budget.For example, you may be someone who likes to keep active and have social interaction. So a fitness program like SilverSneakers, which gives you access to a network of gyms and other programs, might be a good fit for you. A Medicare Advantage plan may provide these types of fitness or wellness programs.Another thing to consider is whether or not you have an elective surgery planned for 2023. If so, you’ll want to check your hospital-specific benefits under your current Medicare Advantage plan.4. Check Your Plan’s Drug FormularyYour Medicare plan’s drug formulary will not be included in your Annual Notice of Change, so be sure you call your insurance carrier to see if your prescription drugs will be covered for the 2023 plan year.If your prescription drugs aren’t covered, it’s wise to use the Medicare Annual Enrollment Period to find a plan that does cover them.5. Talk To Your DoctorAnother “Medicare must-do” is to make sure all of your doctors and healthcare facilities will remain in network with your current Medicare plan. If they aren’t, you may want to take advantage of the Medicare Annual Enrollment Period.So be sure to ask your doctor if he or she plans on changing health plan affiliations over the next year.What Changes Can I Make During the Medicare Annual Enrollment Period?The first thing to know is that you cannot use the Medicare Annual Election Period to enroll in Medicare Part A or Part B for the first time.But if you’re enrolled in Medicare Part A and Part B and you’d like to change your Medicare coverage, here are some things you can do during the Medicare Annual Election Period:Change from Original Medicare to a Medicare Advantage plan.Change from one Medicare Advantage plan to another.Disenroll from your Medicare Advantage plan and go back to Original Medicare.Change from one prescription drug plan (Medicare Part D) to another.Enroll in a prescription drug plan.Cancel your prescription drug coverage.What Are The Benefits of a Medicare Advantage Plan?Understanding your Medicare plan options - starting with a Medicare Advantage plan - is a smart first step to take because you can switch, enroll into or disenroll from Medicare Advantage plans during AEP.Medicare Advantage plans, otherwise known as “Medicare Part C” or “MA Plans,” bundle Original Medicare (Parts A and B) services into one plan. These plans are offered by private insurance companies. And while Original Medicare offers you a number of benefits, it may not cover health and medical services you might need.Medicare Advantage plans are appealing to many people because they’re considered “all-in-one” plans that give you an annual cap on your spending as well as access to extra benefits, which may include: Dental and vision coveragePrescription drug coverageAccess to fitness programsHealth incentive programsRides to medical appointmentsTelemedicine servicesNote: If you have limited income, you might also qualify for extra savings on Medicare costs through these programs.Medicare Savings Programs. These programs help pay for some of your Medicare Part A and Part B out-of-pocket costs, such as copays, deductibles and premiums. Most programs are for Medicare beneficiaries who also qualify for Medicaid. And as mentioned, Medicaid covers the majority of your costs when you join a Medicare Advantage Special Needs Plan. You can check if you qualify through your local Medicaid office.Medicare Extra Help. Extra Help reduces your Medicare prescription drug plan costs. You should contact Social Security to check your eligibility for Extra Help if you have an existing Medicare drug plan or you join one during AEP. Find A Medicare Advantage Plan During AEPTo enroll in an eligible plan during the Medicare Annual Enrollment Period, you can use our comparison tool as a guide to assess your needs and help you choose a Medicare plan. Or, you can give us a call.Our licensed insurance agents are available to help 7 days a week. Call us toll-free at 1-888-605-1433 (TTY 711). Weekdays: 8am – 11pm ET Saturday: 10am – 7pm ET Sunday: 11am – 6pm ET Tip: Be sure to have these 3 items handy before you call us or enroll in a Medicare plan online during AEP:Your Medicare number, which is found on your red, white and blue ID card.Your list of prescription drugs and preferred pharmacy.Your list of preferred doctors and hospitals.We’re here to help you compare your options and find you a Medicare plan that meets your individual needs. 

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