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  • Mark Fonville, CFP®

How to Reduce Prescription Drug Costs with Medicare Part D 2019 Open Enrollment Consulting

Did you know that October 15th, 2018 through December 7th, 2018 is the annual open enrollment for Medicare Part D coverage for 2019?

If you have a Medicare Part D prescription drug plan, or if you intend on enrolling in a plan, now is a great time to start thinking about how to reduce the costs of your prescription drugs.

Get your Retirement Checklist of over 30 things that you need to think about for your retirement.

What is Medicare part D prescription drug coverage?

Medicare Part D (drug coverage) was instituted in 2006 as part of the Medicare Modernization Act of 2003.

As a Medicare beneficiary, Medicare Part D prescription drug coverage is an optional insurance coverage to help you cover the costs of prescription drugs. It can be a valuable component of reducing your costs in retirement if you take prescription medications.

Unfortunately, if you don’t sign up for Medicare Part D Coverage when you’re first eligible at the age of 65, a late-enrollment penalty may be imposed if you decide to enroll later.

Many people are automatically enrolled in Original Medicare, Part A and Part B, when they reach 65 years of age. But, did you know that Original Medicare doesn’t cover most of your prescription medications (except those you may receive at a hospital inpatient or, in some cases, outpatient)?

Medicare Part B covers certain prescription drugs that you get in an outpatient setting, like a doctor’s office. However, these medications are typically ones that a doctor needs to administer.

If you want help with most other prescription medication costs, you’ll need to sign up for Medicare Part D coverage.

Your Medicare Part D Coverage May Be Costing You Money

In the past, there has been a lot of confusion as to who needed Medicare Part D, what plans were “the best”, and how penalties would work if you did not sign up when eligible around you 65th birthday.

As a result, most people who did not have other “creditable” drug coverage, either through work or a retiree benefit, made their decision based on a company they were familiar with or medicare part D premium cost.

Sadly, many people who enrolled for medicare part D didn't choose the best plan for their personal situation. Those plans are often kept over time without any review of the plan, even though there are many plans available.

For example, in 2018, there are 24 Medicare Part D plans available in the marketplace.

Each coverage plan has a different combination of costs based on premium, co-pay structure, deductibles, and how their drugs are treated in the “donut hole.” Additionally, some plans cover certain prescription drugs, while others do not.

Every Medicare Part D prescription drug plan changes one or more cost variables every year. Additionally, your drug needs may change from year to year. As a result, the Medicare Part D prescription drug plan you had last year, may not be the best plan for you this year!

The only way to properly analyze which plan meets your individual needs and has the lowest total annual cost (the only number that counts) is to run the comparison program available on the Medicare website and/or get expert advice on your medicare part D options.

However, running the medicare comparison program on your own can be time consuming and often confusing. As a result, you may avoid doing it and risk paying higher out of pocket costs for you and your family.

Reduce Your Prescription Drug Costs with Medicare Part D Consulting

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