Medicare prescription drug plan coverage and costs can vary from year to year. These changes can impact you financially. Make sure you understand the latest Medicare Part D 2020 so you can plan for any upcoming costs associated with prescription drugs.
What is Medicare Part D?
Medicare Part D is a federal prescription drug coverage program offered by private insurance companies. Prescription drug coverage can be purchased one of two ways:
- Bundled with medical. Most Medicare Advantage plans cover both Part C (medical) and Part D (drug) plans, eliminating the need to manage more than one insurance plan. These plans are called Medicare Advantage with Prescription Drug (MAPD) plans.
- As stand-alone plans. If you are not in a Medicare Advantage plan that “bundles” medical and drug coverage, you can purchase a stand-alone Part D or drug-only plan. These are for individuals who otherwise do not have Part D coverage, either because they carry Original Medicare (Parts A and B), a Medigap plan (also called a Medicare Supplement plan, which does not include Part D benefits), or a Medicare Advantage (Part C) plan that does not offer prescription drug benefits.
What is covered by Part D depends on the plan; each plan offers a list of prescription drugs (called a formulary). The formulary will tell you what drugs are covered. It will also tell you the drug tier, which helps you determine what the drug will cost.
Find out more about drug formularies and how tiering affects your costs.
Medicare Part D Changes in 2020
This year, the federal government has instituted policies to help Medicare beneficiaries save money.
- Certain low-cost generic drugs can now be substituted onto plan formularies as they become available, passing the savings to beneficiaries more quickly.
- Some innovative medications known as “biosimilars” have seen a widespread reduction in price.
- The government has encouraged competition among pharmacies, which improves access for beneficiaries.
Overall Costs for Part D
Despite these savings, understanding Part D costs can feel overwhelming — so it always helps to talk to an expert. Here are a few basic facts to get you started:
- You may be responsible for a deductible. Some Part D plans require you to satisfy an annual deductible of up to $415 out of pocket before coverage kicks in. MAPD plans from Independence Blue Cross (Independence) do not have a prescription drug deductible, so your medications can be covered right away.
- You’ll probably pay copays or coinsurances. Most plans assign copays or coinsurance for drugs by sorting the medications into different tiers, from least expensive to most expensive, but there are some ways to save money. Costs can be lower if prescriptions are filled at in-network pharmacies, and some plans, including MAPD plans from Independence, offer special discounts for using preferred pharmacies. Your carrier may also offer discounts if you buy three-month supplies of your medications at a time or you buy through an approved mail-order program; both benefits are available to Independence MAPD members.
- You may move through different coverage stages. You may move through some different coverage stages with your Part D coverage: the Initial Coverage stage, the Coverage Gap stage, and the Catastrophic Coverage stage. During each stage you are responsible for a different percentage of your drug costs. A representative of the plan can help you understand what your costs will be during each stage, and you may be able to get assistance with affording your medications through a Medicare cost-saving program or directly from their manufacturers.
Questions about managing your prescription drugs? Help is available. Contact a licensed agent if you have questions.
Website last updated: 2/24/2020
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