PostHeaderIcon Medicare Prescription Benefits in 2010

The Medicare prescription drug plan has four phases:

1. Depending on your policy you may have to pay up to the first $310 of your drug costs. This is known as the deductible.

2. During the initial coverage phase, your drug plan pays 75% of the covered prescription drug costs (after your deductible is met) and you pay 25% until the total drug costs (including your deductible) reach $2,830.

3. Once you reach $2,830 in total drug costs, you will be in the coverage gap, and you must pay the full cost of prescription drugs until your total out-of-pocket cost reaches $4,550. This annual out-of-pocket spending amount includes your yearly deductible and co-pay amounts. ($1,720)

4. When you spend more than $4,550 out-of-pocket, the coverage gap ends and your drug plan pays most of the costs of your covered drugs for the remainder of the year. You will be responsible for a co-pay of $2.40 for each generic drug and $6.00 for other drugs (or 5%, whichever is higher). This is known as catastrophic coverage.

It is important to understand that your Part D prescription drug plan may differ from the standard Medicare prescription plan design, only if the plan offers you a better benefit. For example, your plan can eliminate or lower the amount of the deductible. And, your plan can pay for generic or brand name medications in the coverage gap.

Health Reform and Medicare Part D

The Patient Protection and Affordable Care Act signed into law on March 23, 2010 makes several changes to Medicare Part D to reduce your out-of-pocket costs when you reach the gap in coverage, including:
1. In 2010, if you have expenses in the coverage gap, you will receive a $250 rebate from Medicare.

2. Beginning in 2011, if you reach the donut hole, you will be given a 50% discount on the total cost of brand name drugs while in the gap.
3. Medicare will phase in additional discounts on the cost of both brand name and generic drugs.

By 2020, these changes will effectively close the coverage gap and your responsibility will be 25% of the costs.

2 Responses to “Medicare Prescription Benefits in 2010”

  • Annett Helminiak says:

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  • Donald Perry says:

    The American Medical Association urges Congress to preserve health care for seniors by blocking a sizeable Medicare cut to doctors. If nothing is done by December 1, doctors will be receiving 25% less from Medicare, which will have negative repercussions for the elderly health care, the AMA (American Medical Association) announced today.

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