What is the Medicare Prescription Drug Program?
The Medicare Prescription Drug Program was implemented by Medicare starting in 2006 to provide assistance in paying for prescription drugs for persons enrolled in Medicare Part A and/or Part B. If you are in a Medicare Advantage Plan you will need to be enrolled in Part A and Part B.
How does the Medicare Prescription Drug Program work?
Under the program, Medicare pays part of the cost of prescriptions. A senior will pay a deductible after which Medicare pays 75% of the cost of the prescription and the Senior is responsible for 25%. Once prescription costs for the year reach a preset point, Medicare stops paying (the Doughnut Hole) and the senior is responsible for 100% of the cost. Medicare will start paying again after prescription costs accumulate to a certain point and the senior becomes eligible for catastrophic coverage.
What are 'PDP's?
A PDP (Prescription Drug Plan) is typically a separate drug plan administered by an insurance company and incorporates Medicare's Prescription Drug Program as part of their program. These plans are for persons on original Medicare, Medicare Cost Plans or Private Fee For Service (PFFS) Plans.
What are 'MA-PD's?
These are Medicare Advantage plans that usually provide all of the coverage associated with Medicare Part A and Part B while also incorporating a prescription drug plan. MA-PD's also incorporate Medicare's prescription coverage as part of their plan.
Are all Medicare Prescription Drug Plans the same?
The simple answer is a resounding no! While most plans pay all or most of the deductible imposed by Medicare and a portion of the 25% co-pay, there are significant differences in plans. The variables in plans may include: 1. the monthly premium; 2. the amount of co-pay (may vary by prescription); and 3. which drugs are covered. It will definitely pay to shop around based on your prescriptions.