Medical insurance can be confusing. When it comes to Medicare, there is no exception. You may have Medicare part A to cover you when you have to go to the hospital and part B to help pay for your doctor visits and such. If you need regular medications, you may have opted for part D, the prescription drug supplement. Things get even more confusing with part D. The amount you pay for your medications throughout the year will vary from a small co-pay to having to pay full price. However, the Affordable Care Act has made some changes to what you have to pay. Here is some information to better understand Medicare part D.
If you enrolled in a Medicare Advantage Plan, it may include the prescription drug plan with your normal monthly payment. Anyone not in the advantage plan will have to pay for part D. This Medicare supplement is available from most medical insurance companies. The premium amount is different from one company to another. Therefore, it is a good idea to shop around and compare prices before buying it.
The deductible amount is how much you have to spend on your medications before the insurance starts to pay. Each insurance company is allowed to determine how much the plan deductible is, and some plans may not have a deductible at all. However, new federal regulations limit the amount to $360.00 in 2016. This is an increase of $40 over the limit for 2015.
Once you have spent enough on your medications for the insurance company to start paying, you will still have to pay some amount for each prescription. If your plan has a co-pay, it will be a specified amount per prescription. The amount will be determined by the type of drug and what "tier" it falls on. If you have a co-insurance plan, you will pay a percentage of the price of each prescription.
The "Donut Hole"
In case things are not already confusing, once you, and the insurance company, have spent $3,310 on your medications, you will be responsible for paying 45% of the price for your brand name medications and 52% for generic medications until you have paid $4,850 out of your own pocket. However, during the donut hole, you are able to pay only 45% of the price of brand name drugs due to a federal and manufacturer's discount of 55%. This discount is included in your out of pocket expense. In other words, the actual price of brand name drugs goes towards reaching the donut hole maximum. Also included are your deductible and any co-pay or co-insurance amounts you had to pay.
If you are lucky enough to have only an occasional prescription, Medicare part D might not be necessary for you. However, it is good to know that this type of coverage is available if you ever need it. Just be sure to reconsider things every year during the annual enrollment period. For more information, speak with professionals like Shifflett Insurance Services Ltd.