Medicare Prescription Drug Plans



With the Medicare Modernization Act of 2003 prescription drug coverage was made available to everyone with Medicare Part A coverage. This coverage is made available through private insurance companies and not Medicare directly.


Medicare has mandated certain minimum benefits but has allowed the insurance companies to improve upon the mandated minimums. The basic benefits include a deductible upfront then co-insurance after that to a certain level of prescription drug costs. Once someone has reached that point then they enter what is called the “gap in coverage”. At this stage then you pay 100% of all drug costs until your payments have reached another level. When you have hit this point then you are in the “catastrophic” area and your co-payments or costs become more reasonable.


As with the Medicare Advantage Plans the government has not required any standardization of these plans. One of the most important factors in determining which plan will work best is the list of covered prescription drugs. Not all drugs are covered by each PDP. The drugs that are listed in the plans formulary or list of covered drugs, each will have its own category which determines your cost or co-payment. With all of the variables each plan has, it can be difficult to know which plan will work best.


Some states have as high as 60 or so PDP’s to choose from. This can be very challenging for people to pick the right plan. This is why we spend the time necessary to help compare the plans which will provide the best possible coverage.