The newest portion of the Medicare program is Medicare Part D. The program was created through the Medicare Prescription Drug, Improvement, and Modernization Act which was approved by Congress in 2003. The new prescription drug coverage plan took effect on January 1, 2006 and replaced the previous prescription coverage offered through Medicare’s original Part A and Part B.
Medicare Part D prescription drug plans (PDP) are not administered by the Centers for Medicare and Medicaid Services, but instead provided by private health insurance companies that are contracted through Medicare to provide PDPs to those on Medicare. In order for beneficiaries to enroll in a Part D PDP, they must either be enrolled in Part A and/or Part B of Original Medicare or receive both their Part A and Part B benefits through a Medicare Advantage Plan (Part C) that includes prescription drug coverage.
It is impossible to provide an all encompassing list of Medicare Part D providers and their plans as there are 1,576 stand alone PDPs available to Medicare beneficiaries in 2010. That number is actually down from the 1,689 plans that were available in 2009. Part D plans vary widely based upon the drugs covered under each plan and also by geographic location. The goal of Medicare Part D is to provide assistance in purchasing generic and brand name prescription drugs from pharmacies near a beneficiary’s home. In some instances, Medicare PDPs even offer mail-order programs that will ship an individual’s prescription drugs directly to their home.
Medicare Part D providers range from some of the biggest names in health care to smaller providers that only offer coverage in just one or two counties of a particular state. Among the Part D providers from around the country are:
- Aetna Medicare (offered in 26 different states from Alaska, Hawaii, and Arizona to Minnesota and Maine.)
- CIGNA (offers plans in over 20 states from Louisiana, Florida, and Georgia to Alaska and Hawaii.)
- Alta Med Senior Buena Care (one of the smaller providers operates only in Los Angeles, California.)
As of 2010 the citizens of Alaska and Hawaii have the fewest plan options at their disposal with 41 different PDPs available in their respective states. Residents of Pennsylvania and West Virginia on the other hand have the most plans to choose between with 55 PDPs available in their regions.
Medicare develops a formulary, or list of approved drugs, that Medicare Part D plans will pay for and these lists will determine what sort of PDPs are offered by Part D providers. Individuals looking into a Part D plan need to carefully consider all the drugs they need and find a plan that fits their needs perfectly. Every PDP will come with a monthly premium and that amount will vary depending on how many different drugs, and which specific drugs, are covered. Most plans, though not all, will include a deductible that must be reached before coverage kicks in. As of 2009 that deductible could be no higher than $295. Some plans also have copayments or coinsurance costs that must be paid out of pocket. These costs will vary based upon plan and drugs covered.
Medicare Part D has proven popular among Medicare beneficiaries. When the program started four years ago 11 million Americans were enrolled in PDPs provided under Part D. As of April 2010 though, enrollment has risen to 27.6 million individuals.