Choosing the best drug plan under Medicare Part D isn’t always easy. Some people just pick the plan with the lowest premium, but that plan might not be the best value for you, depending on your needs.
The real cost of a plan depends not only on the premium, but also on the availability of the drugs you need, your additional out-of-pocket costs, and how convenient it is to obtain your medications.
Here are the key factors to consider (besides the premium) when deciding on a Part D plan:
The formulary. A plan’s “formulary” is the list of drugs it covers and will pay for. Does the plan you’re considering include all the drugs you need, or anticipate needing? How much will they cost?
Keep in mind that a plan’s formulary can change from time to time, but typically, once you sign up for a plan for a year, the plan can’t drop your coverage of a drug you need until the end of the year.
If you switch to a plan that doesn’t cover a drug you’re currently taking, the plan might cover it anyway during a brief “transition” period. You might ask about this period. A one-month transition is fairly common (and might be all you need), but some plans have shorter or longer periods.
Also, if you’re prescribed a medically necessary drug that’s not in your plan’s formulary, the plan might in some cases make an exception. You might inquire as to your plan’s process for granting such an exception.
The deductible. Is the deductible the legal maximum ($325 in 2013), or something less? Some plans have no deductible at all.
Covered pharmacies. Will you be able to continue buying drugs at your customary pharmacy? Is that pharmacy a “preferred” provider, and if not, will you have to pay more to use it? If you’re living in a long-term care facility, is the facility’s pharmacy included in the plan’s network?
Expensive drugs. It’s worth looking into whether a plan will try to “steer” you toward using lower-cost drugs. For example, will it require that you try a cheaper medication before it will cover a more expensive one prescribed by your doctor? Also, are there different co-payments for generic and brand-name drugs?
Quantity limits. Is there a limit on the number of prescriptions you can receive in a month? Is there a limit on the number of pills available in a single prescription?
Mail-order. Are you allowed (or required) to use mail-order? Is there a price difference for mail-order purchases?
The plan sponsor. Is the sponsor a known, reliable entity?
Effect of state programs. How do the plan’s benefits coordinate with any state pharmaceutical assistance programs you might use?
If you’re currently enrolled in a Medicare drug plan, the window of opportunity to change plans runs from October 15 to December 7. If you’re newly eligible for Medicare, you can enroll in a prescription drug plan during the seven-month period that starts three months before the month you turn 65.