Medicare Glossary Q-T

Prescription Drug Plan Terms and What They Mean

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Quantity Limit:

A program that is designed to limit the use of selected drugs for quality, safety or utilization reasons. There may be limits on the amount of the drug that we cover per prescription or for a defined period of time.

Service Area:

A geographic area where a prescription drug plan accepts members if it limits membership based on where people live. The plan may disenroll you if you move out of the plan’s service area.

Special Enrollment Period (SEP):

A set time when members can change their health or prescription drug plans or return to Original Medicare. Situations in which you may be eligible for a Special Enrollment Period include: if you move outside the service area, if you are getting "Extra Help" with your prescription drug costs or if you move into a nursing home.

Specialty Drugs:

A costly or unique prescription drug (classified within the Specialty Tier) that often requires special handling and/or close monitoring.

Standard Pharmacy:

A standard pharmacy is one that contracts with a Medicare Part D plan allowing members of the plan to fill prescriptions using their plan benefit, but may not offer the lowest copays and coinsurance that are offered by a preferred pharmacy.

State Pharmaceutical Assistance Program (SPAP):

A financial assistance program operated and funded by the state that provides assistance to pay for drug coverage based on financial need, age or medical condition. Assistance is not based on current or former employment status.

Step Therapy:

A utilization tool that requires you to first try another drug to treat your medical condition before we will cover the drug your physician may have initially prescribed.

Supplemental Security Income (SSI):

Monthly benefit paid by the Social Security Administration to people with limited income and resources who are disabled, blind, or age 65 and older. SSI benefits are not the same as Social Security benefits.


A system that Medicare prescription drug plans use to classify prescription drugs according to the level of cost-sharing. Generally, higher tiers require higher out-of pocket costs.

True Out-Of-Pocket (TrOOP) Cost:

The amount paid by you and other parties on your behalf during the year for covered drugs, including any deductibles and copays and coinsurance, but not premiums. Once this amount reaches $5,100 (in 2019) and $6,350 (in 2020), of your plan’s true out-of-pocket limit, you automatically enter catastrophic coverage. Note: this dollar limit is subject to change each year.

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