Medicare Part D Plans

The biggest brand name companies in the health insurance industry offer Part D Plan. This includes name brands like Humana, Aetna, Blue Cross and Blue Shield, United Healthcare and more. There are also a number of companies you may not have heard of before you were eligible for Medicare, such as Silverscript or Express Scripts.

Choosing a Medicare Part D plan seems easy but many people tell us that they are confused by too many choices or simply how they work. Others have had to switch plans because they were put in the wrong plan. The worst thing that can happen is you get enrolled in a plan but you won’t realize it’s the wrong plan until you use it. Hence, you are stuck with the plan and the out of pocket costs until you can change out of it once a year during the Annual Enrollment Period that happens from October 15th thru December 7th.

The best way to find the right plan that matches you is to have a licensed advocate at Nevada Medicare assist you. We use Medicare’s Drug Plan Finder tool to analyze the plans offered in Nevada. We have an exclusive database that tells us which plans will give you the lowest annual out of pocket spending.

No. Medicare Part D coverage is optional, but if you don’t enroll in Part D as soon as you’re eligible, you might pay a late-enrollment penalty if you enroll later.

If you fail to enroll in Part D during your Medicare Initial Enrollment Period, you will have to wait for a future Annual Election Period to enroll, which means you could be without coverage for months after a diagnosis of an illness before you can get into a plan. You will also be assessed a late penalty later on when you do enroll. The only exception to this is if you didn’t enroll is because you had other creditable drug coverage, like employer coverage or VA benefits.

The late enrollment penalty is an amount added to your Medicare Part D monthly premium.

You may owe a late enrollment penalty if, for any continuous period of 63 days or more after your Initial Enrollment Period is over, you go without one of these:

The penalty is calculated by Medicare as follows:

• 1% of the national average base Part D premium for every month that you went uncovered and did not have other creditable coverage. The penalty is rounded to the nearest $.10, and then added to the premium you pay for your new Part D premium.

More importantly, if you miss your window, you cannot buy a drug plan mid-year without a special circumstance. Imagine if you develop a serious health condition in March and you need a very expensive medication for it. You would pay the full retail cost of that medication until the next Part D annual election period – the earliest you could sign into a plan would be October 15th. This means you would have no coverage until January 1st. The true risks of being uninsured is unimaginable.

The base premium for 2020 is around $32.74, so if you had waited 24 months to enroll in Part D, you would have a penalty of 24%. That translates to $7.85 added to your chosen Part D plans’ premium. When you do finally enroll in Part D, you will pay this penalty every month.

How long do you pay this penalty for? The penalty that the government will impose on you is Lifetime. This means you would be paying this for as long as you live.

Mrs. Goodrich is currently eligible for Medicare, and her Initial Enrollment Period ended on May 31, 2016. She doesn’t have prescription drug coverage from any other source. She didn’t join by May 31, 2016, and instead joined during the Open Enrollment Period that ended December 7, 2018. Her drug coverage was effective January 1, 2019.

2019

Since Mrs. Goodrich was without creditable prescription drug coverage from June 2016–December 2018, her penalty in 2019 was 31% (1% for each of the 31 months) of $33.19 (the national base beneficiary premium for 2019) or $10.29. Since the monthly penalty is always rounded to the nearest $0.10, she paid $10.30 each month in addition to her plan’s monthly premium.

Here’s the math:

.31 (31% penalty) × $33.19 (2019 base beneficiary premium) = $10.29

$10.29 rounded to the nearest $0.10 = $10.30

$10.30 = Mrs. Goodrich’s monthly late enrollment penalty for 2019

2020

In 2020, Medicare recalculated Mrs. Goodrich’s penalty using the 2020 base beneficiary premium ($32.74). So, Mrs. Goodrich’s new monthly penalty in 2020 is 31% of $32.74 or $10.15 each month. Since the monthly penalty is always rounded to the nearest $0.10, she pays $10.20 each month in addition to her plan’s monthly premium.

Here’s the math:

.31 (31% penalty) × $32.74 (2020 base beneficiary premium) = $10.15

$10.15 rounded to the nearest $0.10 = $10.20

$10.20 = Mrs. Goodrich’s monthly late enrollment penalty for 2020

Yes, you will receive an ID card for your Part drug plan. So if you have a Supplement plan you will have your Medicare Part A/B ID Card, Supplement Plan ID card and Part D prescription drug plan ID Card. If you only have a standalone Part D and Original Medicare, you will only have your Part D prescription drug plan ID Card and your Medicare Part A/B ID Card.

Be aware as well that most of the time, your Medicare Part D plan can be with a different insurance company than your Supplement plan. This is normal.

Keep in mind though that there are Medicare Advantage plans that have a Part D drug plan built-in them already – this means you only get one ID card for everything.