How to Choose a Medicare Prescription Plan WisdomCard™

Our Guides and Physician Review team have organized the Top 10 Health Resources on How to Choose a Medicare Prescription Plan and compiled helpful research notes below.

Research Notes on How to Choose a Medicare Prescription Plan

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Introduction

Medicare's Part D prescription plans can be a big money-saver, but the online enrollment process is confusing and daunting to some. Whether you're choosing a plan for yourself or for a friend or relative, here's how to do it right.

What to Know

The open enrollment period for Medicare Part D plans is Nov. 15 through Dec. 31 for coverage during the following calendar year. At other times of the year, you can only enroll if you have permanently moved to another state, become newly eligible for Medicare, or become disabled.

If you have prescription coverage through military retiree, VA, or federal employee benefits, it will almost always be better to keep that coverage rather than use Medicare Part D. If you have prescription coverage through a current or former employer, your insurer is required by law to inform you whether that coverage is greater or less than that provided by Medicare.

Even if you aren't on any prescriptions, it may be to your advantage to sign up for a plan. If you don't do so when you become eligible for Medicare, you will pay a penalty for signing up later.

Make a list of all the prescription medications you take regularly. This is a good thing to have in any case. Be sure your health-care providers and close family members also have access to this information. One way to do this is to use software such as My Medications List. You'll also need your Medicare claim number and effective date of coverage.

Step 1: Visit Medicare.gov

You can sign up for a plan by phone (1-800-633-4227 or TTY to 1-877-486-2048) but it's a lot easier and faster to do it over the Internet. At Medicare.gov, choose the link to compare Part D prescription plans, or go straight to the questionnaire.

Step 2: Enter Your Information

The first page asks for personal data such as your last name and your date of birth. After you fill out this page on a secure connection, you'll move to a non-secure section of the site where your personal data (except for your zip code) is not used. The second page asks for information about your current coverage.

On the third page, you'll enter your drugs. You can choose whether or not to allow generic drugs to be substituted for brand names.

At this point you'll have the option to sign up for MyMedicare.gov, an optional service that allows you to view your Medicare benefits online. There's no need to do this if you don't want to, but it may save you time re-entering your information on future visits.

Even if you don't sign up for MyMedicare, you can save your drug list by choosing a password in the form of a date (something you'll remember, perhaps a wedding anniversary). Record your drug list ID and this password somewhere safe.

Finally, you'll choose up to two local pharmacies. This choice doesn't mean you have to go to those places -- in fact, most of the time you'll be better off using mail-order for ongoing prescriptions -- but it does mean you'll get listings of plans that are accepted locally.

Step 3: Review Your Options

Once you get to a page of options, you have several choices for viewing the various plans. By default, they are organized by the lowest annual cost, and the plan at the top of the list may well be the best choice. However, be aware of a few concepts that might change your mind:

• Formulary: This is the list of drugs covered by each plan. If one of your drugs is listed as "not on formulary," you'll most likely have to pay full price, so it's worth it to find a plan that will cover all of them.
• Gap: The Medicare Part D plan offers discounts on the first $2,510 of prescriptions purchased in a year, and covers 95% of anything over $4,050. The amount in between these two, called the "gap" or "doughnut hole," is not covered at all, which can come as a rude shock at the drugstore counter. Some plans ease the blow by covering generic drugs during this period. If your total prescription bill for a year is less than $2,510, you don't have to worry about the gap -- unless you end up on new drugs. Depending on your situation, gap coverage may be an important part of your selection.
• Deductibles and premiums: These work just like other insurance you may have had. A deductible is an out-of-pocket amount you have to pay before the insurance benefit kicks in. Premiums are a set monthly amount you pay for prescription coverage.
• Step therapy: Some plans will require you to try a cheaper drug before using a more expensive one.

Use the comparison tools to dig deeper into the details of each plan, including customer ratings.

Step 4: Choose a Plan

If you're not ready to decide, you can click "Add" instead of enroll to put certain plans on a "favorites" list for comparison and future decision-making. Otherwise, choose "Enroll" to select a plan. You can choose to have your monthly premiums automatically withdrawn from a bank account or from your Social Security check, or you can choose to receive a bill from the provider every month.

Conclusion

While you're at it, this may be a good time to go over your medications with your primary care physician, making sure all of them are still necessary and that there are no adverse interactions between them. Also make sure that a trusted friend or family member has a list of your medications and could communicate with medical personnel in an emergency.