Jeffrey Wade
Medicare Part D provides prescription drug coverage to help with the cost of prescription drugs, including deductibles and copays. Medicare Advantage Plan (Part C) or other Medicare health plans with drug coverage are also available. Medicare drug coverage is available to anyone with Medicare, but to join a plan, you must live in that plan's service area and be a United States citizen or lawfully present in the United States. You can apply for Extra Help and Medicare Savings Programs (MSPs) at the same time, and these state programs provide help with other Medicare costs. Medicare's Limited Income Newly Eligible Transition (LI NET) Program gives temporary Medicare Part D drug coverage to people who qualify for Extra Help but are not enrolled in a Medicare drug plan yet. Many drug companies also have patient assistance programs that cover some or all of the costs of their medicines.
| Characteristics | Values |
|---|---|
| Medicare Drug Coverage | Part D |
| Who is eligible? | People with Medicare Part A and/or Part B |
| How to apply | Join a Medicare-approved plan offered by private insurance companies |
| Requirements | Must live in the plan's service area and be a U.S. citizen or lawfully present in the U.S. |
| Extra Help Program | Helps with the cost of prescription drugs, like deductibles and copays |
| Eligibility for Extra Help Program | Depends on income and resources |
| Apply for Extra Help | Any time before or after enrolling in Part D |
| Limited Income Newly Eligible Transition (LI NET) Program | Provides temporary Medicare Part D drug coverage for people who qualify for Extra Help but are not enrolled in a Medicare drug plan |
| State Pharmaceutical Assistance Programs | Several states offer programs to help uninsured or underinsured residents pay for medications |
| Patient Assistance Programs (PAPs) | Offered by many drug companies to cover some or all of the costs of their medicines |
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What You'll Learn
Medicare Part D and Extra Help
Medicare Part D provides drug coverage. The Extra Help program assists with the cost of prescription drugs, like deductibles and copays. Some people are automatically enrolled in the Part D Extra Help program, while others must apply themselves. Your eligibility depends on your income and resources. You can apply for Extra Help at any time before or after you enrol in Part D.
If you have both Medicare and full-benefit Medi-Cal, you will be automatically enrolled in a Part D plan if you do not choose one yourself. This may occur a few months after you become eligible for the Part D benefit. You can also receive the LIS benefit if you enrol in a Medicare Advantage plan with prescription drug coverage (MA-PD). The Extra Help/LIS reduces the portion of the premium that goes toward the prescription drug benefit. However, you are still responsible for any premium that is designated for the medical and hospital benefits.
If you have Medi-Cal with a share of cost (SOC), you may qualify for the Extra Help/LIS program. Unlike those who have full-benefit Medi-Cal, you do not automatically qualify for LIS, unless you meet your SOC in a given month. If you do not meet your SOC, you can apply for LIS at your local Social Security Administration office. If you have Medicare with an income below 150% of the federal poverty level (FPL) and meet the asset requirement, but are not on other assistance (Medi-Cal, Medi-Cal with SOC or an MSP), you can apply for the LIS program at your local Social Security or Medi-Cal office.
If you don't get Extra Help automatically, you can apply for it. You can also contact your local State Health Insurance Assistance Program (SHIP) to get free help applying. You can apply for Extra Help and Medicare Savings Programs (MSPs) at the same time. These state programs provide help with other Medicare costs.
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Medicare Savings Programs
There are four types of Medicare Savings Programs: QMB, SLMB, QI-1, and QDWI. Each program has different income and resource eligibility limits, which may be slightly higher in Alaska and Hawaii. To qualify for a Medicare Savings Program, you must have income and resources below a certain limit, though these limits go up each year. Even if your income or resources are higher than the federal limits, you may still qualify as some states do not count certain types or amounts of income or resources when deciding who qualifies.
The Qualified Medicare Beneficiary (QMB) program is for people with income less than 100% of the Federal Poverty Level (FPL) and resources under $9,660 if single, $14,470 if married. QMB covers Medicare premiums (Part A, if applicable, and Part B), deductibles, copayments, and/or coinsurance. If you get Part A for free, QMB can still pay your Part B premiums even if you have refused or terminated Part B.
The other three programs, SLMB, QI-1, and QDWI, do not provide the same benefits as QMB. With these programs, you are still responsible for your Medicare deductibles and coinsurance. However, you can visit doctors who accept Medicare, even if they also accept Health First Colorado, a Medicaid program.
To apply for a Medicare Savings Program, you must first be eligible for or receiving Medicare. Then, you should contact your state or county of residence's Department of Human Services to apply. You can also contact your local State Health Insurance Assistance Program (SHIP) to get free help applying.
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Medicare Advantage Plan (Part C)
Medicare Advantage Plan, also known as Medicare Part C or MA, is a health insurance plan offered by private companies approved by Medicare. These companies include Humana, which offers licensed sales agents to help you select the coverage that best meets your needs.
Medicare Advantage Plans provide Part A (Hospital Insurance) and Part B (Medical Insurance) coverage. They may also offer additional benefits, including vision, hearing, dental, and/or health and wellness programs. Most Medicare Advantage Plans also include Medicare prescription drug coverage (Part D).
The main difference between Original Medicare and Medicare Advantage Plans is that the latter are offered by private companies, while Original Medicare is administered by the federal government. As a result, Medicare Advantage Plans can be customized with extra benefits and may have different out-of-pocket costs and rules for how you access services.
You can apply for a Medicare Advantage Plan during your Initial Enrollment Period (IEP) for Medicare, which starts three months before the month you turn 65 and ends three months after. If you already have Original Medicare and want to switch to Medicare Advantage, you can do so during Medicare's Annual Enrollment Period (AEP), which runs from October 15 to December 7. If you're already enrolled in a Medicare Advantage Plan and wish to switch plans, you can do so during the Medicare Advantage Open Enrollment Period (OEP) from January 1 to March 31.
The projected average premium for a Medicare Advantage Plan in 2025 is $17 per month, but there may be additional costs such as copays and deductibles. To learn more about Medicare Advantage Plans and how to apply, visit the official Medicare website or contact a licensed sales agent from a provider such as Humana.
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Medicare drug coverage rules
Medicare drug plans may have rules for if and how they cover drugs. These rules can include medication safety checks, drug management programs for safer opioid use, and Medication Therapy Management (MTM) programs for complex health needs. When your drug coverage begins, you may receive a transition fill, a one-time 30-day supply of a drug your plan doesn't cover or requires prior authorization or step therapy for. Prior authorization is when your plan approves a drug based on specific criteria that you and your prescriber must meet. Your prescriber may need to demonstrate that the drug is medically necessary for it to be covered. Plans may also require prior authorization for specific medical conditions.
You or your prescriber can request an exception to prior authorization if a drug is not on the plan's drug list or if a waiver is needed for coverage. The request must be supported by a statement from your doctor or prescriber explaining that the drug is medically necessary for your condition, even if you don't meet the prior authorization requirements. They must also explain that you will experience negative health effects if you take a different drug, and that a different drug would be less effective.
Step therapy is a type of prior authorization that requires you to try a less expensive drug on the plan's formulary first, which has proven effective for most people with your condition. If an exception to step therapy is approved, your plan will cover a more expensive drug even if you haven't tried the less expensive option. Plans may limit the amount of medication they cover over a specific time period for safety and cost reasons. For example, a plan may only cover a set number of tablets per month.
Medicare covers transplant drug therapy, including certain compounded immunosuppressive drugs, if they helped pay for your organ transplant. To be eligible, you must have Part A when the covered transplant occurs and Part B when you receive immunosuppressive drugs. If you have Medicare due to End-Stage Renal Disease (ESRD), your coverage, including immunosuppressive drug coverage, ends 36 months after a successful kidney transplant. However, Medicare offers a benefit to help with the cost of immunosuppressive drugs beyond this period if you don't have other health coverage.
There are two main ways to obtain Medicare drug coverage. One option is to join a Medicare Advantage Plan (Part C) or another Medicare health plan that includes drug coverage. Alternatively, you can obtain Part A (Hospital Insurance) and/or Part B (Medical Insurance) and join a separate Medicare drug plan (Part D). Remember that you must have Part A and Part B to join a Medicare Advantage Plan, and you will typically receive your drug coverage through that plan.
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State pharmaceutical assistance programs
Many states offer State Pharmaceutical Assistance Programs (SPAPs) to help residents pay for prescription drugs. Each program is different, and the availability of SPAPs varies from state to state. States may coordinate their drug assistance programs with Medicare’s prescription drug benefit (Part D). In some cases, you may be required to sign up for Part D to qualify for assistance under SPAP. If a drug is covered by both SPAP and your Part D plan, the total amount paid will count towards the out-of-pocket maximum before reaching catastrophic coverage.
Some states have qualified SPAPs, which provide a Special Enrollment Period (SEP) to allow you to enrol in or make changes to your Part D or Medicare Advantage coverage. You can check if your state offers SPAP and whether you are eligible by visiting www.medicare.gov. Additionally, you can contact your local State Health Insurance Assistance Program (SHIP) to get free help with the application process.
Medicare also offers other cost-saving programs to help with drug costs. The Limited Income Newly Eligible Transition (LI NET) Program provides temporary Medicare Part D drug coverage to those who qualify for Extra Help but are not yet enrolled in a Medicare drug plan. If you qualify for Extra Help and believe you are paying the wrong amount, you can contact your drug plan and provide proof of Extra Help enrolment to correct your costs.
Furthermore, once your total drug costs, including certain payments made on your behalf through the Extra Help program, reach $2,000, you will pay nothing for each covered drug. If you have full Medicaid coverage and are in the Qualified Medicare Beneficiary (QMB) program, you will pay no more than $4.80 for each covered drug. You can also compare Medicare drug plans to find a plan with lower drug costs or ask your doctor about cheaper alternatives.
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Frequently asked questions
Medicare Part D provides drug coverage and helps cover the cost of prescription drugs.
The Extra Help program assists with the cost of your prescription drugs, like deductibles and copays. Your eligibility depends on your income and resources.
You can apply for Extra Help at any time before or after you enroll in Part D. You can contact your local State Health Insurance Assistance Program (SHIP) to get free help with your application.
You can explore other options such as state pharmaceutical assistance programs or patient assistance programs (PAPs) offered by drug companies. These programs help uninsured or underinsured individuals pay for medications.
You can ask your doctor about alternative medications covered by your insurance or cheaper generic options. You can also look into prescription coupons or copay cards offered by drug companies and nonprofits to help reduce prescription costs.
