Comparing Medicare Part D Plans
When comparing Medicare Part D plans, there are several factors to keep in mind while searching for the best plan to fit your needs.
- Does the monthly premium provide a good value for your needs?
- Is the annual deductible amount something you are comfortable with?
- Do you want a stand-alone Prescription Drug Plan (PDP) or a Medicare Advantage Prescription Drug Plan (MAPD)?
- What are the initial coverage and out-of-pocket limits?
Medicare Part D plans are sold by private insurance providers with Medicare's approval. Because of this, however, the monthly premium amount is likely to vary by plan and company. It is recommended that you shop around in order to be fully aware of your prescription drug options.
Just as the monthly premium cost will fluctuate across insurance providers, the same is true of annual deductibles.
When choosing a plan, determine whether or not you wish to enroll in a Medicare Advantage Prescription Drug Plan (which is a privately offered combination of health and doctor benefits, along with prescription drug coverage) or simply purchase a stand-alone Prescription Drug Plan. Always check with the plan provider to ensure a specific prescription is covered, and what the cumulative out-of-pocket costs may be so that you can make an informed decision.
There's an annual cap on how much you will be asked to pay for Medicare Part D. The Initial Coverage Limit for 2013 is $2,970, meaning that once your Part D plan pays out this amount in prescription costs, you enter the Coverage Gap (also known as the “Donut Hole”). Once you're in the Coverage Gap, you assume out-of-pocket responsibility for all of your prescription costs until you spend a total of $4,750, at which point your Part D plan will then pay all remaining drug costs for the remainder of the year.