Medicare Part D (PDP)
Medicare Part D (PDP) is private insurance to help cover the cost of prescription medications. Part D plans provide coverage for both generic and brand name medications and can be added to Medicare Part A, B or a Medigap and can be included in a Medicare Advantage plan (MAPD).
Medicare Part D Late Enrollment Penalty (LEP)
When you first become eligible for Medicare, you have an initial seven-month period to sign up for coverage (IEP), including Part D. If you’re eligible because you are turning 65, your Initial Enrollment Period (IEP) begins three months before your 65th birthday month and ends three months after your birthday month.
After that IEP, you’ll pay a Part D late enrollment penalty if you go without one of these types of prescription drug plans for 63 days or more:
A Part D plan
Prescription coverage through a Medicare Advantage (Part C) plan
Any other Medicare plan that includes Medicare PDP coverage
Another healthcare plan that includes prescription drug coverage that is at least as good as the coverage provided by Medicare.
The Cost of Waiting
If you do not enroll in a Prescription Drug Plan (PDP) when you are first eligible and you do not have creditable coverage you will be subject to the Late Enrollment Penalty (LEP) you will also have to wait for the Annual Election period (AEP) to enroll for a January 1st effective date. The penalty is 1% of the base premium per month you were without coverage. This penalty stays with you for life.
During the time you do not have Part D coverage you are subject to paying retail cost for your medications.
Extra Help also called low income subsidy (LIS) helps individuals pay for the cost of Medicare Prescription Drugs. If you meet the guidelines below you will receive the following:
Help paying your Medicare drug plan’s monthly premium, yearly deductible, coinsurance, and copayments.
No coverage gap
No Late Enrollment Penalty (LEP)
You automatically qualify for Extra Help if you have Medicare and meet one of these conditions
You have full Medicaid coverage
You get help from your state Medicaid program paying your Part B premiums (in a Medicare Savings Program- MSP)
You get Supplemental Security Income (SSI) benefits
Extra Help Requirements:
*Resources include money in a checking or savings account, stocks, bonds, mutual funds, and Individual Retirement Accounts (IRAs). Resources don’t include your home, car, household items, burial plot, up to $1,500 for burial expenses (per person), or life insurance policies.