By Kat. Mitrou
If you’re like many Americans, the introduction of Medicare
Part D is nothing short of confusing. By May 15 of this year,
if you haven’t signed up for the program, you could end up
without drug coverage, or have to pay the penalty for applying
after the deadline. The penalty is a 1% increase in your
premium for each month after May 2006 in which you don’t
enroll.
The following is a step-by-step guide designed to get down to
the basics of Medicare Part D, cut through the jargon, and
tells you exactly what you need to know.
Step #1: Eligibility. Are you eligible for Medicare’s new
prescription drug plan? Simply put, if you are eligible for
Medicare Part A or Part B, you are eligible for Part D.
Step #2: Cost. What will Medicare Part D cost you? For drug
expenses in the range of $0-$250, you pay 100% of the cost.
When and if your costs fall between $250-$2,250, the plan pays
for 75%, and you pay for 25%.
At this point, the infamous coverage gap, often referred to as
the “donut hole,” comes into play. Essentially, if your total
drug costs, which include what you and the plan pay for
prescriptions, exceed $2,250 per year, you pay 100% of your
drug costs after that point until you reach $3,600 in
out-of-pocket expenses (total $5,100 in drug costs). But after
you escape from the “donut hole,” you only have to pay for 5%
of your drug costs.
What you pay also includes the usual insurance costs associated
with a drug plan. If you do not qualify for extra help, you will
pay: monthly premiums, a yearly deductible, and co-pay or
co-insurance for each prescription.
If you qualify for extra help due to a limited income, you will
pay: low or no monthly premiums, low or no yearly deductible,
low or no co-pay or co-insurance for each prescription, and you
don’t have to worry about the coverage gap.
Through Medicare’s prescription drug plan, you must choose drug
coverage from one of the many private plans made available for
the purpose of Medicare Part D. This is usually the point at
which people become the most confused. There is a wide range of
plans from which to choose, and in the end, the right one for
you depends on your unique circumstances. Search for the plan
that offers the lowest total costs for the year, including your
premiums, deductibles, co-payments or co-insurance for each
prescription, and any drug costs you pay during the coverage
gap.
Step #3: Drugs Covered. Choosing an insurance plan also
requires that you make a selection based on the specific drugs
you need. The list of drugs covered is called a formulary. So
when determining which plan is best for you, cost is only one
consideration – you must also make a choice based on the type
of drugs covered. Generic and brand name drugs are included in
the formularies, but if a drug you take is not on the list, you
will either have to pay for it in full, or switch to a similar
drug that is covered by the plan.
Step #4: Joining. Signing up for a plan is, luckily, easier
than you may think. You can either sign up through the plan’s
website or through http://Medicare.gov. Another option: call
the company offering the plan you desire, or call Medicare
directly.
About the Author: Article was written by Katerina Mitrou
sponsored by http://www.medicare-news.com.
http://Medicare-news.com provides news articles, updates, Q and
A, and tutorials to help people understand all parts of Medicare
with a special focus on Medicare Part D (the prescription drug
plan). Article reproductions must include a link to
http://www.medicare-news.com.
Source: http://www.isnare.com
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