Medicare Part D Update

How to estimate your "Out of Pocket" prescription drug costs. In response to a number of your emails asking us to clarify the Medicare Part D "Out of Pocket" cost, we have a few examples of how the "Out of Pocket" prescription drug costs are calculated. Please remember though, that these are only estimates and your actual costs will depend on the Medicare Part D plan that you select this Fall (starting November 15, 2005). Your out of pocket prescription drug costs are calculated on a progressive-like basis (like your federal income tax). Therefore, you will pay the first $250 yourself (as the Medicare Part D Plan deductible). After your deductible, you will need to pay 25% of all your prescription drug costs up to a total of $2,250. For this example, let us assume that your total yearly prescription drug expenses are $2,600. Therefore, you will pay 25% of the difference between the deductible ($250) and $2,250 which is: (2,250 - 250)*.25 = $500. When you spend more than $2,250, you will be responsible for 100% of the difference between $2,250 and (as in our example) $2,600 or an additional cost of $350. Your total ESTIMATED annual "Out of Pocket" prescription drug cost with a Medicare Part D plan should then be around: $250 + $500 + $350 = $1100 (plus the monthly premium for the Medicare Part D plan). :: Top Here is an other example of how the "Out of Pocket" costs add-up. If a Medicare beneficiary had prescription drug costs of $5,100 per year, here is how much it would cost the Medicare Part D beneficiary personally: Annual Deductible (or first $250 spent): $250 25% of ($2,250 - $250 = $2000): $500 100% of ($5,100 - $2,250 = $2,850) $2,850 Total Cost to Medicare Beneficiary (out-of-pocket) $3,600 As already mentioned, please remember that these calculations are only approximations and may vary with your individual situation or the plan that you select. What if our example Medicare beneficiary has Prescription drug costs of more than $5,100? Once our example Medicare Beneficiary has spent approximately $3,600, the last paragraph of the guidelines goes into effect: More than $3,600 annual out-of-pocket threshold - The Medicare Beneficiary pays: the greater of either: (1) 5% of the Prescription Drug Costs or (2) $2 for generic Prescription Drugs / $5 for brand-name Prescription Drugs. - Medicare Pays: the lesser of either: (1) 95% of the Prescription Drug costs or (2) the balance of the Prescription Drug costs. In this last example, the Medicare beneficiary costs will depend on the type/cost of prescription medication that is purchased. When in our example, the Medicare beneficiary purchases non-generic Prescription drugs costing more than $5.00, the Medicare Beneficiary would need to pay 5% of the total costs. :: Top Still not sure about out of pocket cost? Use our free online Cost Calculator. If you would like to calculate your "estimated" out of pocket prescription drug costs, we have built a free online Cost Calculator. You need only go to the link below, enter your yearly prescription drug costs and press the "Submit" button. ** Please note: No data will be collected by us and your information remains confidential. :: Medicare Part D - Online Out-of-Pocket Cost Estimator :: Top Is there any "penalty" or cost after the May 15, 2006 enrollment deadline? Yes, there may be an additional monthly cost to those who enroll in a Medicare Part D plan after the open enrollment period ends. As already mentioned, the Medicare Part D open enrollment period begins November 15, 2005 and ends May 15, 2006. After the May 15 date, the cost for a Medicare Part D Prescription Plan will increase an estimated 1% per month. Some have called this cost increase a "life-time premium penalty". For example, if the normal cost of a plan during the open enrollment period is $35.00 per month, a person who waits 12 months to enroll in a Medicare Part D plan would add $4.20 a month to their monthly premium (calculated - 1.12 * $35.00 = $39.20). Please note, that these penalties or additional costs may not apply if you currently have drug coverage through a former employer or union considered as "creditable coverage". :: Do you have questions? Visit our FAQs and Customer Helpdesk :: Top What happens to my other Prescription Drug Plan after May 15, 2006? As the Medicare Part D prescription discount plans are introduced, existing Medicare-approved drug discount cards will be phased-out. If you buy a Medicare Part D prescription plan prior to May 15, 2006, your old Medicare-approved discount card will expire on the date your Medicare Part D coverage begins. All Medicare-approved prescription drug discount cards will expire on May 15, 2006. :: Top Not yet signed up for our FREE newsletter? Sign-up here! Please Enter Your Email Address * Re-enter Your Email Address * Select Your State * Choose State Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montona Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Virginia Vermont Washington Wisconsin West Virginia Wyoming SPAM Filter Activated? If you would like to have our Newsletter properly delivered, please add our email information (Team@NimBroker.com) to your SPAM Filter, Contact List, Sender List, or Address Book. :: Top