Joy Miller, RD, LD
Family and Consumer Science Extension Agent
Adult Development and Aging
Family Resource Management
K-State Research and Extension
Southwind Extension District
210 S. National
Fort Scott, KS 66701
Office: 620-223-3720
Fax: 620-223-0332
joymiller@ksu.ed
You might be familiar with the
acronym CMS, Centers for Medicare & Medicaid Services. CMS is the
federal agency that administers Medicare. Annually, they revise the
parameters for the standard drug Medicare Advantage and Part D
plans to account for increased prescription drug costs. The
parameters include the four phases of a Medicare drug plan- deductible,
initial coverage phase, coverage gap (or donut hole), and
catastrophic coverage. Depending on what medications a Medicare
beneficiary is prescribed will depend on how many phases one
might enter, varying the costs of prescriptions through out the
year.
The first phase of a Medicare
drug plan is the Deductible Phase, this is the
amount one must pay each year for prescriptions
before a plan pays its share. Deductibles vary between plans, the upper limit for 2021
is $435. Not all plans have a deductible and not all
medications are subject to the full drug cost in this phase.
Once the deductible phase is
met, a beneficiary enters the Initial Coverage Phase and pays a
copayment or coinsurance for covered drugs. The amount paid will depend
on if it is a generic or brand name, tier classification, and a plan’s
drug formulary. This phase continues until a total
of $4,130 (2021) is spent by the beneficiary and the drug
plan.
The Medicare drug Coverage Gap
phase (or “donut hole”) was officially closed in 2020, but that doesn’t mean
people won’t pay anything. Entering this phase, a beneficiary will
pay a co-insurance of 25% of the full cost of a drug for generic and brand name
prescriptions. The insurance company and drug
manufacturers are responsible for the other 75%. It is important to
know if or when and how much you might have to pay for prescriptions during
this phase.
Once $6,550 (2021) has been
reached, the beneficiary enters the Catastrophic Coverage phase. During
this phase, copays or coinsurance significantly lower for the for
remainder of the year. Drug costs are now a co-insurance
of 5% of the cost for each prescription or $3.60 for generics
and $8.95 for brand-name drugs, whichever is greater. The other 95%
of the costs are covered by the plan and government.
Medicare plans keep track of
how much money is spent out of pocket for covered drugs and progression through
coverage phases and should appear in your monthly statements.
During Open Enrollment, October
15-December 7, Medicare beneficiaries have the opportunity to review
current insurance plans and shop for a new one. A
Senior Health Insurance Counselor (SHICK) can assist you with a personalized
drug plan comparison to determine your expected financial costs and if you will
enter more than one phase. If you have questions or would like a
one-to-one appointment, contact the Southwind Extension office for a free,
confidential, and unbiased session in Fort Scott, Erie, Iola, and Yates
Center Southwind Extension offices.
Follow us on Facebook
@southwindextensiondistrict or Instagram @southwind_ext. For more
information, contact Joy Miller at joymiller@ksu.edu or by calling
620-223-3720.
http://fortscott.biz/news/donut-hole-who-pays-what-under-medicare-part-d-drug-plans-in-2021
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