What to Know About Medicare Part D Coverage
Learning what’s covered and how to find the right prescription drug plan
It depends on the Medicare Part D plan, as they each have different formulariesA Prescription Drug Formulary is a list of all the prescription drugs covered by your health insurance. These drugs can be name brand or generic and are broken up into four categories for pricing. or drug lists.
Specific coverage rules ensure medication use is correct and only when necessary.
Gather all your drug information, including medications and dosages, before comparing plans.
Medicare Part D offers prescription drug plans that cover both genericGeneric drugs are prescription drugs that have the same active ingredients as brand-name drugs, but usually cost less. and brand-name drugs.Brand-name drugs are prescription drugs sold under a specific name or trademark. They have the same active ingredients as generic drugs, but usually cost more. Each policy has a standard level of coverage and its formulary lists. Prescription drug costs and availability may vary based on your Part D plan, insurer and location. All plans must offer the same categories of drugs, but drug brand names vary based on the formularies.
You can get Medicare Part D coverage by:
- Adding a standalone prescription drug coverage plan to your Original Medicare (Part A and B) benefitsOriginal Medicare (Parts A and B) is fee-for-service health insurance available to all Americans aged 65 and older and some individuals with disabilities. Original Medicare is provided by the federal government and is made up of two parts: Part A (hospital insurance) and Part B (medical insurance).
- Enrolling in a Medicare AdvantageMedicare Advantage is health insurance for Americans aged 65 and older that blends Medicare benefits with private health insurance. This typically includes a bundle of Original Medicare (Parts A and B) and Medicare Prescription Drug Plan (Part D). plan that includes Part A, B and D
Although Part D plans have different drug lists, certain aspects must be consistent across all prescription drug policies. By law, every Part D plan must cover at least two drugs in most categories.
Plans must cover nearly all types of medication in the six most essential categories:
- Anticonvulsants (for seizure disorders)
- Cancer drugs
- HIV/AIDS drugs
Part D plans must cover all commercially available vaccines unless covered under Medicare Part B. You can find the full list of vaccines covered by Part D in your plan’s drug list. There may be additional costs based on the type of vaccine and where you receive it.
Part D plans generally do not cover medications for:
- Weight loss or weight gain
- Cosmetic purposes (including hair growth)
- Fertility purposes
- Over-the-counter drugs
- Drugs for erectile dysfunction
- Drugs covered by Original Medicare (Part A and B)
Many Medicare Part D plans organize their prescription drug lists with levels of “tiers.”Drug tiers are the categories health insurance companies use to categorize the prescription drugs they cover. The tiers typically range from One to Five. Tier one is the lowest and usually includes the least expensive generic drugs. Tier Five includes specialty drugs that are usually very expensive, and some carriers include a Sixth Tier. The tiers generally represent different costs, ranging from the lowest co-pays to the highest.
- Tier 1 has the lowest co-pay for generic drugs. To receive approval from the Food and Drug Administration, generic drug makers must prove that their product performs the same way as the corresponding brand name drug. Generic drugs use the same active ingredients as brand name drugs to achieve desired results.
- Tier 2 has a medium co-pay for preferred brand name drugs. Preferred brand name drugs are medications manufactured by one manufacturer that are typically lower-cost among all brand name drugs. This is partly because these medications have been in the market for some time and are widely accepted.
- Tier 3 has a higher co-pay for non-preferred brand name drugs. Non-preferred brand name drugs, on the other hand, tend to cost more because they have just recently been introduced to the market. You may have heard the term “designer drugs.” These high-cost drugs fall into the same category.
- Specialty Tier has the highest co-pay for the very highest-cost drugs.
Some Medicare Part D plans have specific coverage rules for safe prescriptions, including prior authorization, step therapy and quantity limits. 
Drug use and safety rules for some medications require prior approval and documentation before Part D will cover it. You can apply for an exception if your healthcare provider believes you must be on that medication.
Some Part D plans require you to try a generic or less expensive drug on their formulary before going up a “step” to brand-name or more costly drugs.
You can request an You can request an exception with your Medicare Part D plan if you need a prescription drug that is not on your plan's formulary. You can also request an exception to move a drug from a more-expensive tier to a less-expensive tier that's already on your plan's formulary.exception through your plan if your healthcare provider believes:
- You need the more expensive drug for medical reasons
- You may experience negative side effects from the less expensive drug
- The less expensive drug could be less effective for your condition
There may be a limit on the number of drugs covered over a period of time for some Part D plans. This could mean you can only get a 30-day supply for certain prescriptions. However, your healthcare provider can request an exception if you need a higher dosage.
You have a choice when it comes to selecting your prescription drug plan. Gather all the information you need, including your medications and doses, before you start comparing plans.
Ask yourself the following questions:
- Which plans cover the prescription drugs I need?
- How much will my monthly premiums, annual deductible, and co-insurance or co-payments be?
- Which plan offers the best price for all of my medications?
- Which pharmacies are in-network?
- Will there be a late enrollment penalty because I waited to join?
How is Part D different from drugs covered by Medicare Part B?
Generally speaking, Medicare Part B doesn’t cover most medications you get from the pharmacy. There are a few exceptions like oral cancer medications, ESRD drugs or some transplant drugs. Additionally, Part B covers some vaccines, including flu, pneumococcal and hepatitis B.
Part D plans, on the other hand, have a broad drug list to treat most conditions. Part D plans cover commercially available vaccines that aren’t covered by Part B. Your plan’s formulary determines the drugs available with your plan.
What if I join a Part D plan and then my prescription changes?
You can request an exception if your doctor prescribes a medication that is not on your Part D plan’s list if you don’t have any other drug coverage.
Can my plan’s drug list change during the year?
Yes, your plan’s formulary can change. This usually happens if drug therapies change or new drugs become available. Drugs may be immediately removed if the Food and Drug Administration (FDA) finds them unsafe. Your plan will notify you of any changes to its drug list. Your plan must give you written notice at least 30 days before the change happens, or you request a refill.