Prescription Drug Coverage

Medicare Part D is a great option for eligible individuals who take prescription drugs on a regular basis. These plans are designed to help pay for the costs of prescription drugs. You can choose a stand-alone prescription drug plan, called a PDP, or a Medicare Advantage Prescription Drug Plan, called an MA-PD.

So, what do prescription drug plans cover? Medicare Part D plans, by law, must cover commonly prescribed drugs. Both PDP and MA-PD plans are offered through private insurance companies that are approved by Medicare. These private companies are able to decide, for each plan, which drugs will be covered.

Each plan has a formulary, or list of prescription drugs that the plan covers. The prescription drugs on each plan’s formulary may change monthly, and plans supply notices to individuals about any changes if it affects a drug they take. If the U.S. Food and Drug Administration (FDA) deems a specific drug to be unsafe, the plan may immediately remove the drug from the formulary and notify all members affected by the change. Plans are not required to send notices to members who are not affected by the formulary change, although plans do need to update their formularies on their website monthly.

Part D sponsors may also provide a general advance notice that they may immediately remove a brand-name drug on their formulary if it is being replaced with a new generic drug that will appear on the same or lower cost-sharing tier and with the same or fewer restrictions. Or, when adding the new generic drug, the part D sponsor may decide to keep the brand-name drug on the formulary, but immediately move it to a different cost-sharing tier or add new restrictions. When making these changes, the part D sponsor may not tell you in advance before making the formulary change, but will later provide you with information about the specific change(s) that were made.

Before making other changes during the year that affect members currently taking a drug and that require advance notice, a Part D sponsor must either give written notice to the affected individuals at least 30 days before the change becomes effective, or provide a 30-day supply of the prescription drug if the affected member requests a refill.

What Drug Plans Do Cover

Commonly prescribed brand name and generic drugs are covered by prescription drug plans. However, not all plans cover all brand name or generic prescription drugs. For example, one plan might cover certain Type 2 diabetes prescription drugs, but it doesn’t necessarily cover all brand name and generic Type 2 diabetes prescription drugs.

Part D plans must also cover all commercially available vaccines and vaccine administration costs associated with Part D vaccines (which exclude vaccines covered under Part B). This includes any vaccine medically necessary to prevent illness, such as the shingles vaccine.

Formularies are set up in tiers. A drug in a lower tier will generally cost you less in out-of-pocket expenses than a drug in a higher tier. Referring to a plan’s formulary can give you a more specific idea of which prescription drugs are covered, and which tier they are in, for the plans you are considering.

What Drug Plans Do Not Cover

Prescription drug plans do not cover all prescription drugs. This includes drugs given in hospitals or doctor offices that are covered under Part A or Part B. It also includes any drugs not listed on a plan’s drug formulary. Lastly, prescription drug plans do not typically cover non-prescription drugs or prescription vitamins (other than prenatal vitamins). Examples of specific prescription drugs not typically covered include those for weight loss or weight gain, hair growth and/or erectile dysfunction drugs.

Because Medicare Part D is provided by private insurance companies, each company can decide which drugs to cover. However, the formulary must meet the minimum standards and requirements of Medicare Part D coverage.