There
are three categories of out-of-pocket expenses associated with each Part D
drug plan: Monthly Premium, Yearly Deductible, and Co-Payments.
The Monthly Premium is the amount you pay each month to the Part D
plan for coverage. Each Part D plan has a different Monthly Premium.
On the Medicare website
you can find the cost of
Monthly Premiums. Or you can look at
this chart showing the stand-alone
Medicare Part D Plans in Maine in 2012. (Chart is courtesy of Stan Cohen,
volunteer Medicare advocate at the Southern Maine Area Agency on Aging.)
The Yearly Deductible is the amount you pay before your coverage begins.
(Some Plans have a $0 deductible.)
This Deductible is in addition to your Monthly Premium. During the
Deductible you pay 100% of your drug costs.
A Co-payment (or Co-Insurance) is the amount you pay for your prescriptions
after you have met the Yearly Deductible amount. This will vary
depending on your total drug costs and the particular Part D Plan you are in.
Most Part D Plans currently have a Coverage Gap (the "Donut
Hole"), but under Health Care reform, the Coverage Gap will gradually go away.
In 2012, while in the Coverage Gap, you will pay 50 percent of the cost of your brand-name
drugs and about
86 percent of the cost of your generics (instead of 100 percent of the cost for both). In
2012 you will enter the Coverage Gap once the
total cost of your drugs reaches $2,930. (Total cost
means the amount you paid for your drugs combined with
the amount the Part D Plan paid for them.) In 2012, you will get out of the Coverage
Gap for the rest of the Plan year after you spend $4,700 out-of-pocket
on your Part D drugs (That amount does not include the cost of your premiums.). Once you
are out of the coverage gap, you will pay a small co-insurance/co-payment for your drugs
for the rest of the Plan year.
