It’s no secret that older adults consume more health care services on average than younger people, and it makes sense. A lifetime of experience compounded by the aging process logically leads to increased health needs. Thankfully, seniors have the option of enrolling in Medicare to help shoulder the financial burden of these needs.

The downside of the Medicare benefits is that they are not totally free to our nation’s seniors.

Take Medicare Part D prescription drug coverage, for example. It is reported that more than 42 million Medicare participants rely on optional Part D coverage for assistance with outpatient drug costs. The program works by allowing Medicare beneficiaries to pay for self-administered drugs through insurance premiums.

There are two basic ways of ensuring seniors have the assistance they need.  One is through a stand-alone drug plan in conjunction with Part A and B “Original Medicare,” (which currently comprises about 60 percent of all Part D enrollees).  The second way is as part of a Medicare Advantage plan. In either case, Part D drug plans are issued by private insurance companies, and as a result there can be significant variation in benefits, covered drugs and pricing.  You can learn more about what Medicare Part D coverage and benefits may be available in your area by using this link to the Medicare website.

Since Medicare Advantage, or Part C, is designed for enrollees to receive all of their Medicare benefits through a private health insurance plan, as opposed to receiving them through Part A and B coverage,  prescription drug plans are already included in most instances. Monthly Advantage premium prices also reflect that coverage. Purchasing a stand-alone plan also comes at a cost. In 2018, the average stand-alone prescription drug premium was $43.48 per month. Among the ten Part D plans with the largest enrollment, average premiums ranged from $20.21 to $83.68 per month.

It is also important to look beyond premium prices when selecting a Part D plan. In addition to monthly premiums, there are fixed cost copays and coinsurance costs to consider. If you are unfamiliar with this terminology, coinsurance is a percentage of the cost of medications. Other out-of-pocket costs depend on particular plans and an individual’s specific medical needs.

Medicare also offers a “Plan Finder Tool” to help seniors select the best drug plans for their needs. This is an excellent tool to use during every annual Medicare Open Enrollment Period from October 15th to December 7th, as covered drugs vary along with premium prices from one year to the next.

If you choose to select a prescription drug plan, there are four ways to pay the premium:

  • Deduct the monthly cost from a personal bank account.
  • Charge it to a credit or debit card.
  • Pay a monthly paper bill.
  • Have it deducted from your Social Security check (you can contact your Part D insurer to set this up).

We know this article may raise more questions than it answers. Do not wait to get the information you need from Medicare or ask our team. We are here to help you find answers to these questions and address any elder law challenges you are facing.