If you are ready to sign up for Medicare, it is important to learn about Medicare Part D. As in every other state, Part D is optional in California, though it is strongly recommended you enroll.
Understanding Medicare Part D
Simply put, Medicare Part D is Medicare's prescription drug coverage, and helps California residents with medication costs. Part D plans are offered through private insurance companies contracted with Medicare. Monthly premiums and covered drugs vary based on the area where you live, the insurance company, and the plan you choose.
Obtaining Medicare Part D in California
As long as you are enrolled in Medicare Part A and Part B, known as Original Medicare, you can sign up for a Medicare Part D prescription drug plan. Enrolling in Original Medicare allows you to purchase a standalone prescription drug plan. If you decide to sign up for a Medicare Advantage plan, also known as Medicare Part C, you can pick a plan that includes drug coverage. Although around 90% of Part C plans include prescriptions, some don’t, so check benefits carefully and look for the MA-PD notification (Medicare Advantage Prescription Drug plan).
You cannot have a standalone Part D plan and a Medicare Advantage prescription drug plan. If you attempt to enroll in a standalone plan, you will be disenrolled from your MA-PD and returned to Original Medicare.
When should I sign up for prescription drug coverage?
As stated above, you must first be enrolled in Medicare Parts A and B to qualify for Part D. Once you are, there are a few times you can sign up for Part D:
- Initial Enrollment Period (IEP): Beginning three months before the month of your 65th birthday and lasting through the three months that follow, this is the first time you can enroll in any part of Medicare. Once you sign up for Parts A and B, you may join a Part D or MA-PD plan. You may also use this time to sign up for a Medigap plan (unless you sign up for an Advantage plan; you cannot have both Medigap and Medicare Part C).
- Annual Enrollment Period (AEP): From October 15 through December 7, you can use this period to sign up for or switch Part D plans, move from Original Medicare to Medicare Advantage, and more from Medicare Advantage to Original Medicare.
- Medicare Advantage Open Enrollment Period (OEP): During this time (January 1 through March 31), people enrolled in a Medicare Advantage plan may switch to a new plan or go back to Original Medicare. If making that change results in you losing your prescription drug coverage, you may also join a standalone Part D plan.
- General Enrollment Period (GEP): From January 1 until March 31, you can sign up for Medicare Part A or B if you did not enroll during your IEP and do not qualify for a Special Enrollment Period (see below). When the GEP ends, you then have from April 1 until June 30 to choose a Part C and/or Part D plan.
To enroll or make changes outside of these periods, you must qualify for a Special Enrollment Period (SEP). No-fault coverage loss or moving outside of your coverage area are both considered qualifying events. For a full list of circumstances, check here.
What is covered under a Medicare Part D prescription drug plan?
Because Medicare Part D and MA-PD plans are offered by private insurers in California, costs and coverage varies from company to company. It is important to compare plans and ensure your choice is affordable, while still meeting your needs.
Be sure to study each plan's drug formulary, which is a tiered list of the medications it covers. The higher the tier, the more expensive the medication. Note that formularies can change on a yearly basis, or even throughout the year. If yours does, the insurance company sends you a notification, but will cover any remaining prescriptions for the rest of the coverage year. You would need to switch to a new plan the following year.
Regardless of which plan you choose, savings are significantly higher with a Medicare Part D standalone or MA-PD plan than without.
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