The Medicare Modernization Act of 2003 (MMA) established the Medicare prescription drug benefit (also known as “Medicare Part D” or “Medicare Rx”) as a new type of insurance to help people with Medicare pay for their prescription drugs.
Medicare prescription drug coverage is insurance that covers both brand-name and generic prescription drugs at participating pharmacies in your area. Medicare prescription drug coverage provides protection for people who have very high drug costs or from unexpected prescription drug bills in the future.
Medicare is working with insurance and other private companies to offer these plans. If you enroll in a Medicare Prescription Drug Plan, portions of your prescription drug costs are paid for by the plan. While plans will vary, you will have several plans to choose from.
Anyone who has Medicare Part A (Hospital Insurance) and/or is enrolled in Part B (Medicare Insurance) can enroll in a Medicare prescription drug plan. To enroll, a person must live in the service area of the plan. The State of Michigan is a service area.
Individuals who reside outside of the U.S. or who are incarcerated are not eligible to enroll in a Medicare prescription drug plan or a Medicare Advantage Prescription Drug plan.
Unlike Medicare Part A and Part B where a person is automatically enrolled, you have to take action. You have to enroll in a plan to get the coverage.
There are three enrollment periods.
- The Initial Enrollment Period allows people to enroll in a Medicare prescription drug plan when they are first eligible for the coverage. The initial enrollment period is similar to the initial enrollment period for Part B (three months before eligibility, the month of eligibility, and three months after eligibility).
- The Annual Coordinated Election Period allows people to change their Medicare prescription drug plan, enroll in a plan, or disenroll from a Medicare prescription drug plan. People may enroll, change plans or disenroll from November 15 to December 31 of each year. Generally, a person remains enrolled in a Medicare prescription drug plan for a year. If the person chooses not to enroll in a plan during the Annual Coordinated Election Period, he or she may not enroll in a plan until the next Annual Coordinated Election Period or if the person has a Special Enrollment Period.
- The Special Enrollment Period allows people with certain circumstances a special time to enroll in a Medicare prescription drug plan. These circumstances include:
- When an individual permanently moves out of the plan service area,
- If a person was not adequately informed that their non-Medicare prescription drug coverage was not creditable or if their current non-Medicare prescription drug plan coverage is reduced so that it is no longer creditable,
- When an individual is entering, residing in, or leaving a long-term care facility.
If you get Medicare due to a disability, you can join from three months before to three months after your 25th month of cash disability payments.
If you don’t sign up when you are first eligible, you may pay a penalty.
Like other insurance, if you join, you will pay a monthly premium and a yearly deductible ($295 in 2009). You will also pay a part of the cost for your prescriptions, including a co-payment or coinsurance. Costs will vary depending on which drug plan you choose. Some plans may offer more coverage and additional drugs for a higher monthly premium.
The law established a standard drug benefit that all Medicare prescription drug plans may offer. The standard benefit is defined in terms of the benefit structure and not in terms of the drugs that must be covered. The annual cost for 2009 for the standard benefit requires payment of a $295 deductible. Then you pay 25 percent of the cost of a covered plan prescription drug up to an initial coverage limit of $2,700. Once the initial coverage limit is reached, you then pay 100 percent of the covered prescription costs to $6,153 ($4,350 out-of-pocket cost not counting monthly premium) after which you then pay 5 percent of the prescription costs.
Your decision about Medicare prescription drug coverage depends on the kind of health care coverage you have now. There are two ways to get Medicare prescription drug coverage. You can join a Medicare prescription drug plan or you can join a Medicare Advantage Plan or other Medicare Health Plan that offers drug coverage.
Medicare prescription drug coverage provides greater peace of mind by protecting you from unexpected drug expenses. Even if you don’t use a lot of prescription drugs now, you should still consider joining. As we age, most people need prescription drugs to stay healthy. For most people, joining means protection from unexpected prescription drug bills in the future.
The list below contains the highest rated Medicare Part D prescription drug plans in the state of Michigan. It is for informational purposes only and some listings may be inaccurate or missing. The list was provided by the Centers for Medicare and Medicaid Services (CMS), but due to the variance in plans based on county, city, and region, some options may not be available in your location.