What does a Medicare drug formulary with tiers mean?

Every Part D plan has something called a formulary, which is a list of drugs covered under the plan. Each formulary has a set of tiers, and in most cases, Part D plans have between three and six tiers. A lower-tier drug usually has lower copays or coinsurance than a drug in a higher tier. For example: Tier 1 – Lowest copay, usually generic drugs Tier 2 – Medium copay includes some low-cost brand-name drugs Tier 3 – Higher copay includes brand-name drugs that have generic versions also available Tier 4 – Higher-co-pay brand-name drugs, and some specialty drugs Tier 5 – Highest copay includes high-cost specialty prescription drugs Suppose you have been prescribed a drug in a high tier, and a drug that is similar or therapeutically equivalent is also available in a lower tier at a lower price. In that case, you can ask your insurance company for an exception to get the lower coinsurance or copay.

Kevin Leinum – your local Medicare Expert – can help you understand the many parts of Medicare and determine what the right fit is for you. Give us a call to discuss the options available to you.

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If I sign up for Part D during Medicare enrollment, how soon does the coverage start to take effect?

The date the coverage becomes effective depends on which enrollment period you used to sign up for your Part D plan. If you sign up for a Part D plan during the Annual Enrollment Period, which runs from October 15th through December 7th, your coverage will be effective January 1st of the following year. If you sign up for a Part D plan during the Open Enrollment Period (OEP), there are only certain situations in which you can do this, which runs from January 1st through March 31st; the coverage will be effective the first of the month after you submit your enrollment. For example, if you sign up in January, your Part D coverage will be effective February 1st. If you sign up when you turn 65 during your Initial Enrollment Period (IEP), your coverage will be effective the first of the month of your birthday month. For example, if you turn 65 on September 8th and submit your enrollment application in August, your Part D plan will be effective on September 1st. If you turned 65 but were still working and deferred your enrollment in Medicare because you had health insurance provided by your employer, your coverage will begin the first of the month following your enrollment in a Part D plan. If you enroll in a Part D plan during a Special Enrollment Period. The effective date of your coverage will generally be the first of the month following your enrollment.

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I am covered by Medicare, but I don’t take any medications

Is it necessary to sign up for a drug plan? There is nothing that requires you to enroll in a Part D prescription drug plan when you become eligible for Medicare. However, suppose you do not enroll when you first become eligible. In that case, even if you don’t take any prescription drugs, you will be assessed a Part D late enrollment penalty when you eventually enroll in a Part D plan. The penalty is assessed if you don’t have Part D coverage or other creditable prescription drug coverage for 63 or more days in a row after you become eligible for Medicare. How much the Part D late enrollment penalty is will depend on how long you did not have Part D or creditable prescription drug coverage. The penalty is calculated by multiplying 1% of the “national base beneficiary premium” ($33.37 in 2022) times the number of full, uncovered months you did not have Part D or creditable coverage. If you don’t take any prescription drugs and do not enroll in a Part D plan for several years after becoming eligible for Medicare, the Part D penalty can be a significant amount of money, and once assessed, it never goes away. There are many Part D plans with low or even $0 premiums(for some MAPD plans), so you would be wise to enroll in one even if you do not take any prescription drugs to avoid what could be a costly penalty down the road. Let Kevin Leinum help you understand the many parts of Medicare.

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What’s the late enrollment penalty for Medicare Part D and when does it take effect?

Suppose you don’t enroll in a Part D prescription drug plan or a Medicare Advantage plan that includes Part D coverage when you are first eligible for Medicare. In that case, you may be assessed something called the Part D late enrollment penalty. The late enrollment penalty is an amount is added to your Part D premium, and once it is incurred, it never goes away. You will be assessed a late enrollment penalty if, at any point, after your Initial Enrollment Period is over, you don’t have Part D coverage or other creditable prescription drug coverage for 63 or more days in a row. The amount of the Part D late enrollment penalty depends on how long you did not have Part D or creditable prescription drug coverage. The amount is calculated by multiplying 1% of the “national base beneficiary premium” ($33.37 in 2022) times the number of full, uncovered months you did not have Part D or creditable coverage. The monthly premium is rounded to the nearest $.10 and added to your monthly Part D premium. The national base beneficiary premium can change every year, and as a result, the penalty amount can change each year. The Part D penalty takes effect as soon as you enroll in a Part D Prescription Drug plan after a break of 63 days or more. Let expert Kevin Leinum help you understand the many parts of Medicare and determine the right fit for you.

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Medicare Advantage plans can be very cost-effective, and in fact, there are plans with $0 premiums.

So how is that possible? To understand how $0 premium plans are possible, you must understand how Medicare Advantage plans are paid. There are two parts to how Medicare Advantage plans get paid. The first is the premium members pay; how the premium is depends on the benefits of the plan you purchase. It can be as low as $0, or in other cases, it can be higher. The second part is the money Medicare pays the insurance company.  Since Medicare Advantage Plans completely replace Original Medicare, Medicare pays the Medicare Advantage insurance company an amount per member based on location, health, and many other factors. It is then the Medicare Advantage insurance companies responsibility to pay for all the health care needed by that Medicare Advantage member. The payment from Medicare makes up the majority of the money the insurance company gets for each member. They then manage their members’ healthcare, negotiate lower physician and hospital costs and drug prices, and many other aspects of healthcare costs. This allows them to provide additional benefits and lower the premiums they can charge even to the point of having $0 premium plans. In addition to the premium for your Medicare Advantage plan, if it is not a $o premium plan, you will still have to pay your Medicare Part B premium and Part A premium if applicable.

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Can I use my Medicare coverage to utilize telehealth services?

If you have original Medicare, Part B will cover telehealth services, and you will have to pay a 20% coinsurance of the Medicare-approved amount for your doctor or other health care provider’s services after you pay the Part B deductible. You will have to pay the same amount for most telehealth services as if you received the service in person. Due to the Coronavirus (COVID-19) pandemic, Medicare has allowed doctors and other health care providers to use telehealth services to treat COVID-19 (and for other medically reasonable purposes) from offices, hospitals, and places of residence (like homes, nursing homes, and assisted living facilities). Medicare coinsurance and deductibles still apply; however, healthcare providers are reducing or waiving those amounts in some cases. If you are enrolled in a Medicare Advantage plan, they must, at a minimum, provide the same benefits provided under Medicare Part A and Part B, so the same telehealth services are available. Depending on the Medicare Advantage plan you are enrolled in, additional telehealth services may be available, and the out-of-pocket costs may be lower. Kevin Leinum – your local Medicare Expert – can help you understand the many parts of Medicare and determine what the right fit is for you. Give us a call to discuss the options available to you.

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What does “step therapy” mean in Medicare drug coverage?

Each Medicare Part D plan has a list of covered drugs that are called a formulary.  Within every formulary, there are a set of rules applied to the prescription drugs covered by the plan. One of those rules is called step-therapy.  If you get a prescription for a medication that has step-therapy rules, there is a process you will have to go through depending on the kind of drug you were prescribed (generic, preferred generic, brand name, etc.). There can be several drugs that are therapeutically equivalent, which means they essentially do the same thing but may have slightly different ingredients. Think of buying a generic brand of ibuprofen vs. buying Motrin ibuprofen over the counter at a drug store. There are the same variations for prescription drugs as well.  Step Therapy is a process that requires members to start with the most cost-effective drug (the first step) and only move on to other, more expensive, or risky medications (additional steps) if necessary. The exact number of steps and requirements can vary depending on the drug. Kevin Leinum – your local Medicare Expert – can help you understand the many parts of Medicare and determine what the right fit is for you. Give us a call at 6198865665 to discuss the options available to you.

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There are several stages of Part D prescription drug plans

Below is a high-level outline of the various stages of Part D plans: Stage 1 – Deductible (not all Part D plans have deductibles) Stage 2 – Initial Coverage Stage 3 – Coverage Gap is also known as the Donut Hole Stage 4 – Catastrophic Coverage Once you have spent $7,050 in out-of-pocket costs in 2022, you move out of the donut hole into stage 4 or catastrophic coverage. Once you reach the catastrophic coverage stage of your Part D drug plan, you will only have to pay low coinsurance or copays for covered drugs for the remainder of the year. You will pay either a 5% coinsurance or $3.95 copay for generic medications and $9.85 for brand-name, whichever is lower while in the catastrophic stage. It is important to remember that even if you are in the catastrophic coverage stage, a 5% coinsurance can still amount to significant out-of-pocket costs if your prescriptions are very expensive. Call Kevin Leinum – your local Medicare Expert about what Medicare covers or how enrolling in a Medicare Advantage or Medicare Supplement plan can improve your coverage and reduce your out-of-pocket costs.

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What is the “Doughnut hole” in Part D Medicare coverage and how does it work?

Most Part D drug plans have a coverage gap (also called the “donut hole”). There is a limit on what the drug plan will cover for your prescription drugs when you are in the donut hole.

The donut hole begins after you, and your drug plan have spent $4,430 in 2022 for covered drugs. This amount may change every year.

Once you reach the donut hole, you will pay 25% of the cost of brand-name prescription drugs. Even though you will only pay 25%, almost the full price of the drug will count as out-of-pocket costs to get you out of the donut hole. Your 15% and what the manufacturer pays (95% of the drug’s cost) will count.

You will pay 25% of the price for generic drugs, and your Part D plan will pay the remaining 75%. How the coverage for generic drugs is different than how it does for brand-name drugs. Only the 25% you pay for generic drugs will count toward getting you out of the donut hole.

Things that count towards getting you out of the donut hole:

Your yearly deductible, coinsurance, and copayments
The discount you get on brand-name drugs in the coverage gap
What you pay in the coverage gap

Things that don’t count towards getting you out of the donut hole:

– The drug plan premium.
– Pharmacy dispensing fee.
– What you pay for drugs that aren’t covered.

Call Kevin Leinum to help you understand the many parts of Medicare.

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I already have drug coverage through the VA. Do I still need to sign up for Part D Medicare?

In most cases, if you have drug coverage through the VA, the benefits are considered creditable by Medicare. This means that as long as you are enrolled in VA drug coverage, you don’t have to enroll in a Part D drug plan to avoid incurring a late enrollment penalty if you ever do need or choose to enroll in a Part D plan. In most cases, if you have VA drug coverage, there are no premiums and no or low copayments for your drugs. You will have to have your prescriptions filled at VA pharmacies or facilities, though. There are some cases in which you may want to also consider enrolling in a Part D plan even if you have VA drug coverage: – If you live a long distance from a VA pharmacy or facility – You live in a non-VA nursing home and want to be able to get your prescriptions filled from the pharmacy that works with your nursing home – You want to be able to have prescriptions filled at retail pharmacies – You do not want to use a VA provider to have prescriptions filled – You want to have access to drugs that are not on the VA formulary but may be covered by a Part D formulary. If you qualify for full Part D Extra Help, also known as low-income subsidy, which may have lower coinsurance or copays than your VA coverage. It’s crucial to understand that there is no coordination between the two different plans. Contact Kevin Leinum Medicare Agent your local Medicare…

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