• Medicare Part D plans are private insurance products that provide coverage for your prescription medications.
  • The details of Part D coverage can vary by plan, but Medicare does provide some guidance on basic coverage rules.
  • Review all your options and find out the best time to sign up for a Part D plan before choosing one.

Finding the best Medicare coverage for your needs is a complicated process that can be filled with many choices. If you choose to add prescription drug coverage, this means you need to select a Medicare Part D plan.

Part D plans can be particularly confusing because there are no federal plans, only those offered by private insurance providers. These plans can vary widely in terms of coverage and costs.

Read on to find out more about how to select the best Part D plan for you.

You can sign up for a Medicare Part D plan as soon as you become eligible for Medicare. Even if you don’t need many medications at that time, you may want to sign up for a Part D prescription plan right away.

Aside from special circumstances, you’ll have to pay a late enrollment penalty if you sign up for a Part D plan after you’re first eligible.

To start the process of finding a Part D plan, you may first want to decide if you’re going to stick with original Medicare (Part A and Part B) or if you’re going to choose Medicare Advantage (Part C).

Some Medicare Advantage plans combine parts A and B with optional extra coverage for things like prescriptions.

The following sections provide steps you can take when you’re ready to start shopping for a Part D plan.

Know what you need

The first step in choosing a plan once you’ve set up your primary Medicare plan is to consider your needs.

You might not be taking many medications when you first become eligible for Medicare. But may have different needs in the future. Consider any current health conditions or those that run in your family. This may be a discussion you want to have with your primary care provider, as well.

Certain types of plans may fit better based on your specific needs. You might think about any medications you’re taking and if you’ll be on them long-term. Make a list of your medications and check that any name-brand or specialty medications are included under any plan you’re interested in.

Apart from your medication needs, think about your financial health. Plan out your monthly budget and decide how much you can afford to pay for prescriptions, copays, and any other out-of-pocket costs that may come up.

Start shopping early

These are a lot of questions to consider. Start planning early to find the best plan for your needs at the best price.

There are only certain windows of time when you can join a plan or switch from your current plan to a new one. If you sign up late, it could cost you more.

Late enrollment penalties

If you choose not to sign up for a prescription drug plan when you’re first eligible, you might have to pay a late enrollment penalty if you add one later.

This penalty isn’t a one-time fee — it will be added to the cost of your drug plan each month. The fee is calculated using the amount of time you went without drug coverage.

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Gather helpful information

There’s a lot of information online that can help you find the best Part D plan to fit your needs. Here are some resources to may help guide you through process or questions you may have, including:

Check your eligibility for assistance programs

Even with a prescription drug plan, medication costs can be difficult to manage. If you’re still having trouble with your monthly costs, there are a number of programs that can help:

  • Medicare’s Extra Help program. The Extra Help program offers help with premiums, deductibles, coinsurances, and drug costs for people with limited income.
  • Medicare savings programs. There are a number of state-based programs that can help you pay for Medicare premiums. If you’re eligible for one of these programs, you’re also eligible for Extra Help.
  • Medicaid. If you have Medicaid, Medicare pays for your medications. You’ll still have to enroll in a prescription drug plan and may have to pay a small portion of your costs. Still, there are substantial savings.
  • Pharmaceutical assistance programs. These programs are offered by pharmaceutical companies and may offer you discounts on individual medications.
  • State Pharmaceutical Assistance Programs. These state programs can offer help paying for your medications.
  • Community programs. There are also a number of local community programs, like Programs of All-Inclusive Care for the Elderly (PACE), that may offer assistance with medication costs.

To enroll in a Part D plan for the first time, begin researching your needs and options before you turn age 65. You’ll have 3 months before and 3 months after your 65th birthday month to sign up for Medicare plans, including Part D plans.

When to enroll

After your initial enrollment in original Medicare (parts A and B), you have 63 days to choose a Medicare Advantage and/or a prescription drug plan. If you don’t enroll at this time, you’ll have to wait for specific enrollment periods.

How to enroll

To enroll in a Part D plan, you have several options. You can enroll:

  • online through the Medicare plan finder tool
  • by calling Medicare directly at 800-MEDICARE (800-633-4227)
  • by contacting a private insurance company that offers the Part D plan you want, or visiting the company’s website to submit an application

When you enroll, be prepared to provide some basic information about yourself. You’ll also need to have your Medicare card ready to give your Medicare number and the date that your original Medicare coverage began.

Medicare Part D is a private insurance plan that is backed by the federal government.

While there are no federal programs for prescription coverage, Medicare does set a standard for what private plans must cover. Each prescription drug plan must cover at least two medications in each drug category. Each plan can create their own list of covered drugs, as long as there are two in each medication category. These lists are called formularies.

Within the formulary, there are different levels of medications. These levels— called tiers — are based on your plan’s preference for certain generic, brand name, or specialty medications. The tier your medication falls on will determine the cost you’ll pay.

  • There are a lot of things to consider when making coverage choices during your initial enrollment in Medicare.
  • Consider your current and future needs, as well as your budget when researching prescription drug plans.
  • Enrolling late could cost you a life-long penalty.
  • There are a number of programs and organizations that can help you choose a plan and afford coverage for your medications.