Understanding Your Drug Coverage Under Medicare
Understanding your Medicare plan’s benefits can feel overwhelming, especially when it comes to how your medications are covered. Whether you're new to Medicare or just looking to update your plan for 2025, it is important to know the different Medicare drug coverage options.
Medicare drug coverage explained
When it comes to Medicare drug coverage, you generally have two choices: a Prescription Drug Plan (PDP) or a Medicare Advantage Prescription Drug Plan (MAPD). Understanding the difference between these two options can help you make an informed decision.
- Prescription Drug Plan (PDP): Medicare Part D, more commonly referred to as a PDP, is a standalone plan that offers drug coverage only and can be purchased through private insurance companies. If you have Original Medicare (Parts A and B), you can add a PDP to help cover your prescription medications.
- Medicare Advantage Prescription Drug Plan (MAPD): An MAPD is a Medicare Advantage plan (Part C) that includes prescription drug coverage. These plans combine your hospital, medical, and prescription drug coverage into one plan, often with additional benefits like dental, vision, or hearing coverage. MAPDs are offered by private insurance companies who contract with Medicare and each plan may have different costs and provider networks compared to Original Medicare.
Choosing between a Prescription Drug Plan and a Medicare Advantage Prescription Drug Plan depends on your health care needs. Here are a few factors to consider:
- Cost: MAPD plans often have lower overall premiums because most combine the costs of Medicare Part A, Part B and Part D. In addition, MAPD plans may offer low out-of-pocket costs for copays and deductibles.
- Drug Costs: Compare the total costs for all your current prescription medications in each plan.
- Assess Your Health Needs: Consider your current health status and future needs. If you require multiple medications or anticipate needing more comprehensive care, an MAPD plan might be more advantageous.
- Check Plan Reviews and Ratings: Research plans available in your area. Look at customer reviews and ratings to understand the quality and satisfaction levels of different plans.
Understanding drug formularies
Prescription Drug Plans and Medicare Advantage Prescription Drug Plans each have their own drug formularies, which are a list of medications that your Medicare plan covers. This list is organized into different "tiers," with each tier representing a different cost level. Generally, lower-tier drugs (such as generic medications) have lower copays, while higher-tier drugs (like brand-name or specialty medications) have higher out-of-pocket costs.
- Tier 1: Generic drugs—usually the least expensive option.
- Tier 2: Preferred brand-name drugs—more expensive than generics but still relatively affordable.
- Tier 3: Non-preferred brand-name drugs—higher cost.
- Tier 4: Specialty drugs—high-cost medications used to treat complex conditions.
Formularies can vary from plan to plan, so it's important to review the formulary of any Medicare plan you're considering no matter if it is a PDP or MAPD to make sure your prescription medications are covered. If a drug you need isn't on your plan's formulary, you may need to switch to a different medication, pay the full cost out-of-pocket or file an appeal to request coverage.
Choosing between a Prescription Drug Plan or Medicare Advantage Prescription Drug Plan comes down to your individual health needs, financial situation and personal preferences. However, by understanding the basics of Medicare’s drug coverage, you can make a more informed decision and choose the one best for you. Whether you choose a PDP or an MAPD, be sure to review your plan options each year to make sure you're getting the best drug coverage for your health care needs.
If you are a Village Medical™ patient and need help navigating Medicare’s drug coverage, please click here for more information.
Medicare's Annual Enrollment Period (AEP) is Oct. 15 – Dec. 7.