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By Joe Kim, M.D., HealthAtoZ writer
According to some recent surveys, many senior citizens are thoroughly confused about "Part D" of Medicare, which involves prescription drug coverage.
What is Part D?
Part D refers to the prescription drug coverage provided by Medicare. This is the largest expansion of Medicare since it began in 1965. The new plan is designed to help reduce drug costs for senior citizens, but it's very complicated to understand. The coverage is available to anyone who is eligible for Medicare and it covers both generic and brand name drugs.
Deadlines and penalties
First of all, there are deadlines to follow. The enrollment period starts November 15 to December 31 of each year. Your coverage will begin January 1 of the following year.
How it works
The Medicare drug plan is available through private insurance companies. There are over 40 different plans, but they don't all cover the same drugs, so it can be very confusing for consumers. The best way to know if your drug is covered is to go to the "Formulary Finder" on the Medicare Web site. There, you can enter all your medicines and choose a plan that will cover the ones you take.
Fees
Like other private insurance plans, you'll have to pay a monthly premium and a yearly deductible. The costs can vary depending on the plan you choose, and if you qualify for low-income benefits, you may be able to avoid some of these fees.
Will it save me money?
So, will Plan D help you save money? Well, it really depends on the type of insurance and prescription plan you have right now, how many medicines you take and how much you're currently paying. The best way to calculate your savings is to use the "Cost Estimator" available on the Medicare Web site. In general, the more you pay for prescription drugs, the more you save. Part D is designed to help people who pay high out-of-pocket fees for their medications.
The coverage gap (donut hole)
In general, you pay a share of your prescription drug costs and your plan pays a share. Medicare helps pay for drugs up to a limit ($2,400 in total). Once your total out-of-pocket costs for drugs reach $3,850, you pay 5 percent of the costs and Medicare pays 95 percent of the costs for the rest of the year.
More information
To get more information, call 1-800-MEDICARE or visit the Medicare Web site. Talk to your family and make sure you get all your questions answered.
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External Sources
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Centers for Medicare and Medicaid Services
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U.S. Department of Health and Human Services
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This article was reviewed and updated June 2007.
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