Medicare Prescription Drug Plans (PDP)

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Medicare Prescription Drug Plans, also known as Medicare Part D, help cover the cost of prescription medications. These plans are offered through private insurance companies approved by Medicare.

Prescription Drug Plans may help reduce costs for:

• Generic medications 
• Brand-name prescriptions 
• Specialty medications 
• Vaccines 
• Long-term maintenance medications 

Coverage and costs vary depending on the plan you choose.

Each plan has:

• A monthly premium 
• A deductible 
• Copayments or coinsurance 
• A list of covered medications called a formulary 
• Preferred pharmacy networks 

Medications are placed into different “tiers,” which determine your cost. Lower-tier medications are typically less expensive, while higher-tier or specialty medications may cost more.

Not every plan covers medications the same way, which is why reviewing your prescriptions carefully is important.

Choosing a Prescription Drug Plan is not just about the monthly premium.

The right plan should also consider:

• Your current medications 
• Your preferred pharmacy 
• Dosages and frequency 
• Future healthcare needs 
• Overall annual out-of-pocket costs 

Sometimes a lower premium can actually lead to higher medication costs throughout the year.

A formulary is the list of medications covered by a prescription drug plan.

Each insurance carrier has its own formulary, and these lists can change annually. A medication covered this year may:

• Move to a higher tier 
• Require prior authorization 
• No longer be covered 
• Have pharmacy restrictions 

This is why annual reviews are extremely important.

Prescription Drug Plans can change every calendar year.

Changes may include:

• Premium increases 
• Deductible changes 
• Pharmacy network changes 
• Medication coverage updates 
• Changes in copays or coinsurance 

Even if you are happy with your current plan, reviewing your coverage annually can help ensure your medications remain affordable and properly covered.

Medicare requires individuals to maintain “creditable” prescription drug coverage once eligible.

If you go without qualifying drug coverage for too long, you may receive a Late Enrollment Penalty (LEP), which can become a permanent additional monthly cost added to your premium.