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Regardless of whether you selected a Medicare Advantage Plan, Original Medicare or Original Medicare with a Medicare Supplement, everyone needs prescription drug coverage at some point in life. If you don't use medications it can be very tempting to overlook prescription drug plans altogether but doing so can actually lead to Late Enrollment Penalties later on if you are without "Creditable Prescription Drug Coverage" for 63 or more consecutive days.

For many individuals who enroll in a MAPD plans (Medicare Advantage Prescription Drug) the drug coverage is included but there are also MA only plans that do not include drug coverage. Individuals can only be enrolled in either one Medicare Advantage plan or one prescription drug plan at a time. If someone enrolls in either it will automatically cancel the other.

Premium costs and drug formularies will vary greatly depending on the carrier and zip code. Drug costs will also vary depending on the drug stage. On average prescription drug plans are very affordable and when they are finally needed they can save your family  thousands of dollars compared to the small cost of maintaining the drug coverage itself. 

Prescription Drug Plans

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FOUR DRUG STAGES

 

STAGE 1- DEDUCTIBLE STAGE
-Some plans require you to pay an annual deductible
before your plan starts to pay out toward your drug costs.
-Deductible may vary by Drug Plan.
-No plan may exceed $545
in 2024.

 

STAGE 2- INITIAL COVERAGE STAGE
You pay the agreed upon coinsurance for your plan.
Example: If you have a plan with a 25% coinsurance provision and your
medication costs $100,you would pay $25 and they would pay $75.
 
If you and your insurance together paid out $5,030 on prescription drugs, you would enter the next stage, also known as the Coverage Gap.

STAGE 3- COVERAGE GAP
This is often referred to as the “Donut Hole”.
Once an insured and their insurance
company,
combined have paid out $5,030
 toward
prescriptions you enter this stage.
You stay in this stage until you reach $8,000 out of pocket.
Once you reach the gap, you’ll pay no more than 25% for generic and brand name drugs
-The Coverage Gap doesn’t apply for individuals who are receiving extra help for their prescription medications.

What counts toward the coverage gap?
*Yea
rly Deductible

*Coinsurance & Copays

*Discounts on Brand Name Drugs in the gap
*What you pay in the gap

What doesn't count toward the gap?

*Drug Plan Premium
*Pharmacy Dispensing fees
*Cost toward drugs not covered by your plan

STAGE 4- CATASTROPHIC COVERAGE
Once you reach the Catastrophic stage you will only be responsible for a small amount of coinsurance/copays for your covered medications

After the end of the year, the stages reset and you go back to stage 1

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