Medicare Prescription Drug Coverage
When to Enroll
When You Enroll Affects Premium Cost
To pay the lowest possible monthly premium, a person must join a Medicare drug plan when first eligible. If the person doesn't join a Medicare drug plan when first eligible and goes without creditable prescription drug coverage for 63 continuous days or more, he or she may have to pay a late enrollment penalty to join a plan later. (Creditable prescription drug coverage is drug coverage from another source that is expected to pay, on average, at least as much as Medicare's standard prescription drug coverage.)
The penalty is based on the national average premium. While the percentage of the late enrollment penalty stays the same, the national average premium changes every year, and therefore the amount of the penalty for late enrollment changes every year, and the person will have to pay it as long as he or she has Medicare prescription drug coverage. If the person qualifies for extra help, he or she may not have to pay a penalty.
Best Time to Sign Up
Generally there are three times when people can sign up for Medicare prescription drug coverage. The best time to sign up for Medicare Part D is during the Initial Enrollment Period (IEP), which is 7 months long. The IEP covers the 3 months before the month a person becomes entitled to Medicare, the month of the entitlement, and the three months following.
There is an Annual Coordinated Election Period (AEP), sometimes called Part D "Fall Open Enrollment." The AEP is October 15 through December 7 each year. During the AEP, people can join, change, or drop prescription drug coverage. The change will be effective January 1 of the following year.
Special Enrollment Periods
There are special situations that give a person a Special Enrollment Period (SEP), such as a permanent move out of the plan's service area, being eligible for extra help (low-income subsidy), or moving into, residing in, or leaving a long-term care facility (like a nursing home). The time period of the SEP depends on the reason for the Special Enrollment Period.
Some people with Medicare have a continuous Special Enrollment Period, including those who qualify for the extra help and those who live in a long-term care facility. They can change plans at any time, with the new plan coverage starting the first day of the next month.
Enroll Early in the Month
If a person decides to join a Medicare prescription drug plan, it is best to enroll early in the month. This gives the plan sufficient time to mail the membership card, acknowledgement letter, and welcome package before the coverage becomes effective. This way, even if the person goes to the pharmacy on the first day of coverage, the prescription(s) can be filled without delay.
In most cases, if the person joins a Medicare drug plan, coverage is effective the first day of the month after the month the person joins. Enrollment is generally for the calendar year. The person can switch plans from November 15 through December 31 each year if his or her coverage or needs change. In this case, coverage begins January 1 of the following year.
Your Membership Materials
After a person joins a Medicare drug plan, the plan will mail out membership materials, including a card to use when getting prescriptions filled. When using the card, the person may have to pay a co-payment, co-insurance, and/or deductible if any are charged by the plan.
For more information about enrolling in Medicare Part D, visit http://www.medicare.gov to view or print free copies of "Your Guide to Medicare Prescription Drug Coverage" and "Compare Medicare Prescription Drug Plans." (Under "Search Tools," select "Find a Medicare Publication.") You may also call 1-800-Medicare (1-800-633-4227). TTY users should call 1-877-486-2048.