Patient’s Digest®

Your Guide to Medicare Part D

Getting Enrolled

Based on national averages, JJ Burns, certified financial planner and president of JJ Burns and Company in Melville, New York, figures that Part D will pay for itself if you pay more than $728 per year for medications.

But even if you don’t spend that much on medications, it can be costly to delay enrollment. Remember, if you are eligible for Medicare Part D coverage and do not have “credible” insurance coverage “at least as good as” standard Medicare drug coverage, you will be penalized 1 percent per month for every month that you waited to join after you first became eligible. This means that if you were eligible but did not sign up for a Part D plan before the initial enrollment period that ended on May 5, 2006, you will pay a late penalty fee if you enroll in a plan in the future. The late penalty requires you to pay 1% more for each month you’re not enrolled in Part D. Thus, the sooner you sign up for Part D, the less costly any late penalty will become. Individuals who qualify for Medicare from here on out can avoid paying any late penalty simply by signing up for Part D coverage during the first open enrollment period that takes place after their Medicare coverage begins. When checking with your insurer, be sure to use the terms “credible coverage” and coverage “at least as good as” Part D to ensure getting the correct answer.

Even if you do not take any medications, you should consider signing up for prescription drug coverage if you do not already have “credible” coverage. As people grow older, they tend to develop conditions that require long term drug treatment. If you already have coverage, you will be prepared for the costs of these medications. In addition, signing up when you become eligible will ensure that you do not incur the costly penalty.

How to Enroll

Once you have decided which plan is best for your needs, you can enroll in the plan in one of the following four ways:

  • By logging onto www.medicare.gov
  • By calling 800-MEDICARE (TTD: 877-486-2048)
  • By calling the plan’s toll-free phone number and asking for an application that you can complete and mail in 
  • By visiting the plan’s own Website 

Getting the Right Medications

As with any service, you may run into difficulties with your Medicare Part D coverage. Here is a brief rundown of what you need to know to make arrangements for yourself or a loved one.

Keep complete records so that you are prepared if coverage is denied or other trouble crops up. To help your doctor, keep a folder or notebook with the following information about your prescription drug use:

  • How long you have had the condition that each prescription treats
  • Whether your symptoms have increased or decreased over time
  • Other drugs you have taken to treat this condition, if any
  • Any side effects or adverse reactions that you have experienced from taking any drugs

Maintain records of all your correspondence and phone conversations regarding any issues you may have with your prescription drug coverage. If coverage for the medication you have been prescribed is denied, keep a copy of the letter. Make a written log of all problems and actions you took. Include the date you made a call or sent a letter, the name of the person who took your call or responded to your letter or email, the response you got, and what next steps you took.

Note: If you get turned down for coverage on a prescription medication, follow the rules to appeal the decision. (See next chapter, "Take Action: Grievances, Exceptions, and Appeals," for more details.)

If you need a medication that your plan does not cover, have your doctor request an “exception” to the formulary. (See below.) The plan has 72 hours to respond, 24 hours if it’s an emergency. If the plan refuses, you can appeal the decision. When comparable drugs are available, there is a financial incentive for your plan to cover the least-expensive drug. Often the least-costly drug is safe and effective. However, this is not always the case, and your health is at stake. Any decision to use a substitute drug should be made, or at least approved, by your doctor.

Know how your plan makes drug-coverage decisions. Drug plans use several tools and guidelines for making decisions about which drugs to cover. Here are some explanations that may help you understand how your plan works.

Formulary: Prescription drug plans have what they call a “formulary.” This is a list of medications that they cover. Drugs on the formularies are divided into groups, or classes, of medications that work in the same way or are used for the same condition. Generally, Part D plans are legally required to cover at least two drugs per class, though most cover far more than this minimum number. Additionally, the federal government requires Part D prescription drug plans to cover “all or substantially all” of the medications in six classes:

  • Anticonvulsants
  • Antidepressants
  • Anticancer drugs
  • Antipsychotics
  • Immunosuppressants
  • HIV/AIDS drugs

Pre-authorization: With the exception of drugs used to treat HIV/AIDS, Part D plans may require pre-authorization or prior authorization, which will require your doctor or treating health practitioner to provide medical justification to get coverage for a specific drug. Your pharmacist will usually take care of this.

However, there may be times when your pharmacist tells you that you must help get the prior authorization for a drug. If this happens, call your plan, ask why drug coverage was denied, and ask for a list of criteria for approving coverage for the drug. Give this information, along with the date of the call and the name of the person you spoke with, as well as the phone number you called, to your prescribing doctor and ask for assistance in getting prior authorization.

Note: Your Part D plan may change the drugs on its formulary with 60 days’ written notice (except for emergency circumstances).

Transition period for pre-existing conditions: There is a 30-day transition period for new enrollees in which your plan must cover your current prescription medications, even if they are not included on the formulary. During this time, your physician should find a substitute drug that is on the formulary or request an exception.

If you are stabilized on certain drugs, such as those used for HIV, cancer, or depression, your plan must make the exception. Check with your pharmacist or doctor to see if your prescription drugs qualify.

Access to Network Pharmacies: Your plan may have a long list of pharmacies where you can get your prescriptions filled, but it may also have a smaller list of preferred pharmacies or chains, which often will have lower (prenegotiated) prices. If you cannot access a preferred pharmacy near you, because, for example, there is no public transportation or it is not wheelchair accessible, you can request an “exception” in order to get the same prices at other network pharmacies.

Price Tiers: Formularies may be “tiered.” This means that some medications are “preferred drugs” because they are less expensive. “Non-preferred drugs” are more expensive; therefore you will have to pay more for them. Usually the drugs that are least expensive for the drug plan are the ones on Tier 1, and are least costly to you. Sometimes the drug you need may be on a higher tier because it is expensive to the plan, and hence expensive to you. But if it is the only drug that can be used to treat you, you may want to request that the plan make an “exception” to allow you to pay the lower-tier, cost-sharing rate.

Note: If you are a dual eligible or low-income Medicare beneficiary receiving Extra Help (financial assistance; see page 11), you may not be required to pay the higher cost sharing.

Step Therapy: With some of the drugs in the classes above, again with the exception of drugs used to treat HIV/AIDs, plans use a “fail-first” policy, or step therapy, which requires you to try drugs in a predetermined order, starting with the least-expensive drug, until you find one that works for you without intolerable side effects. The exception to this rule is if you are already taking one of these medications. Sometimes your opportunity to benefit from a prescribed drug may be lessened if you are forced to go through a fail-first regimen. This may be particularly true with antipsychotic medications. In these cases, you should check with your doctor before taking a substituted drug.

Generic Drugs: A generic drug is one that the U.S. Food and Drug Administration (FDA) has determined to be chemically equivalent to a brand-name drug. Hence, generic drugs can be equally effective and may substitute for their brand-name equivalent. But sometimes a generic may not be as effective as, or may cause different side effects from, the brand-name drug. Not all medications have generic comparables; but when they do, plans often encourage doctors to write the prescription for the generic drug. Many pharmacies routinely dispense the generic drug unless the doctor writes on the prescription to specifically dispense the brand name (“dispense as written”) or unless you request the brand-name drug from the pharmacy. If your plan does not allow this, you and your doctor can request an exception from the plan in order to get the brand-name drug.

Beware of Substitutions: Sometimes a plan will make a therapeutic substitution when it covers only a drug that is chemically different from the one you have been prescribed. If you face this situation, you should ask your doctor whether the substituted drug is okay for you to take.

Quantity Limits: Some Part D prescription drug plans limit how much of a drug is dispensed at one time to prevent waste. Sometimes patients end up not taking the entire prescription, because they find that the drug is not effective, they experience unbearable side effects, they have an allergic reaction to the drug, or a similar reason. As a general rule, plans dispense a one-month supply or 90-to-100 days’ worth for “main-tenance drugs” that are used to treat chronic conditions (as opposed to acute conditions).

When to ask for an exception

While sometimes drugs listed on the formulary are good substitutes for what you may be taking, at other times they are not good substitutes for the following reasons:

  • You have an allergy to one of the ingredients.
  • The substituted drug has one or more ingredients that may interact with another mediation you are taking.
  • The substituted drug may not work effectively.
  • The substituted drug may have unacceptable side effects.
  • The substituted drug may pose safety risks.

Of course, you will need the help of your pharmacist or physician to help determine if any of these conditions affect you.

If you are denied a medication you need, or if you need to request that a non-preferred drug be offered at the preferred-drug cost, you can ask for an “exception” to the plan’s formulary or cost-sharing policy. The first step is to get your physician or healthcare provider who prescribed the drug to agree that the drug is necessary and that a substitute drug is not appropriate. If these criteria are met, then follow the steps to file for an exception.

Changing Plans

You can change your plan each year between November 15 and December 31. In some special circumstances you may change plans during other times of the year. Dual eligibles always qualify for a special enrollment and may switch plans once per month. Other things that trigger a special enrollment period would include if a person moves to another state/Part D plan region or if they had private retiree coverage (comparable to Part D) and this coverage was dropped.