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For over 40 years, the Medicare program offered almost no options for prescription drug coverage for retirees in the USA. Now Medicare Part D coverage offers more options than most seniors can easily examine. Here 10 top Medicare Part D concerns.

In 2006, Medicare greatly expanded coverage for the costs of prescription medications for Americans enrolled in the Medicare program. The Medicare Part D program currently covers all but about $4,700 of each enrollee's annual prescription drug expenses, low-income retirees usually paying even less. Although $4,700 per year is a lot of money for most people on Social Security, it is a great deal easier on the budget than the nearly unlimited prescription drug expense that could have been incurred before Part D was put in place.

Enrollment in Medicare Part D, however, is not automatic, and potential pitfalls abound. Here are 10 common problems that everyone on Medicare has to resolve to get the maximum prescription drug coverage.

1. It is necessary to be signed up for Medicare Parts A and B to enroll in Part D.

Part A is the basic coverage of Medicare. It only covers 80% of most hospital expenses, and (although coverage is changing in 2014), essentially nothing for out-patient services and medications. It also has a very low lifetime hospital coverage, just 60 days, with potential for unlimited medical expense.

Part B fills in most of the gaps left by Part A coverage. This program enrolls the Medicare recipient in a private insurance program that covers the other 20% of in-patient services and makes most out-patient services (such as visits to the doctor) available with the payment of a $10 to $50 co-pay. Some Part B plans also cover the cost of medical treatment when touring outside the USA.

Part D covers many prescription drug costs, but is only available to people who have already signed up for Parts A and B. A complicated formula leaves up to $4700 in drug costs to the individual, but after that amount it is possible to get generic drugs for $2.50 and brand-name prescription drugs for $6.30 per month, for each prescription.

2. There are hundreds of companies that provide Medicare Part D coverage.

Although retirees sign up for Part D through Medicare, their coverage is provided by a private insurer. Currently there are at least 1,560 insurance companies providing Part D coverage in at least one state, with residents of every stage offered at least 40 and up to 55 different policies. Since different companies treat different medications in different ways, it is best to choose a plan with the help of the online Medicare Plan Finder, for which there is a link below.

3. Certain kinds of drugs are never covered by Medicare Part D.

No Medicare prescription drug plan pays for fertility drugs. Plans also exclude treatments for hair loss, nutritional supplements, drugs for erectile dysfunction, cold and cough remedies, medications available without a prescription, and treatments for obesity or anorexia. Even treatment for morbid obesity prescribed by a doctor is currently not eligible for Medicare Part D coverage. Medicare Part D also does not pay for barbiturates or benzodiazepine tranquilizers. 

4. Other kinds of drugs excluded from many non-Medicare plans actually are covered by Medicare Part D.

Medicare Part D will cover medications for the treatment of acne, psoriasis, rosacea, and vitiligo, even if cosmetic concerns prompt the visit to the doctor. It will cover vitamin D and niacin, when prescribed for specific health conditions (although not for general health). It will pay for drugs for specific health conditions that cause coughs, although for a diagnosis of "cough." Medicare Part D will pay for doctor-prescribed smoking cessation products and for drugs to treat cachexia (wasting) although not anorexia (loss of appetite) caused by chronic disease.

5. If a drug is available under Part A or Part B, and you choose not to pay a co-pay for it, you cannot get the drug under Part D.

Some medications are available as part of Part A or Part B coverage, usually for a co-pay greater than the $2.50 or $6.30 charged for Part D. If you don't take the drug when it is covered by Parts A or B, you can't have it under Part D.

Continue reading after recommendations

  • Centers for Medicare & Medicaid Services, Medicare Prescription Drug Benefit Manual, Revision 10, 19 February 2010
  • Centers for Medicare & Medicaid Services, How to Get Drug Coverage, 1 February 2013.
  • Photo courtesy of publik15 on Flickr: www.flickr.com/photos/publik15/4408676005

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