How to Avoid the Medicare Enrollment Trap and Save Money on Prescription Drugs

Medicare is a federal health insurance program that covers millions of Americans who are 65 or older, disabled, or have certain chronic conditions. Medicare has different parts that cover different types of services, such as hospital care, doctor visits, and prescription drugs.

One of the most important decisions you have to make as a Medicare beneficiary is whether to enroll in Medicare prescription drug coverage, also known as Part D. 

• Part D plans are offered by private insurance companies that contract with Medicare. They help you pay for the medications you fill at a pharmacy and take yourself.

However, many people are unaware of a potential pitfall that can cost them a lot of money if they don't enroll in Part D when they are first eligible. 

• This is called the late enrollment penalty, and it can affect you if you don't have other creditable drug coverage, which means drug coverage that is at least as good as Medicare's.

The late enrollment penalty is a 1 percent increase in your Part D plan premiums for every month you were eligible for Medicare drug coverage but didn't enroll. For example, if you were eligible for 10 months but didn't sign up for a Part D plan, you would have to pay 10 percent more on your premiums every month for as long as you have Part D. This can add up to hundreds or thousands of dollars over time.

So how can you avoid the Medicare enrollment trap and save money on prescription drugs? Here are some tips:

●      Enroll in Part D as soon as you are eligible. You can enroll in Part D when you first become eligible for Medicare, usually when you turn 65. You have a seven-month initial enrollment period that starts three months before your 65th birthday month and ends three months after it. If you miss this window, you may have to wait until the next annual enrollment period, which runs from October 15 to December 7 each year, to sign up for a Part D plan. And you may have to pay the late enrollment penalty if you don't have other creditable drug coverage during that time.

●      Compare Part D plans every year. Part D plans can change their costs, benefits, and formularies (lists of covered drugs) every year. That's why it's important to review your current plan and compare it with other options available in your area during the annual enrollment period. You can use the Medicare Plan Finder tool on the official Medicare website to compare plans based on your medications, preferred pharmacies, and estimated costs. You can also call 1-800-MEDICARE (1-800-633-4227) or contact your State Health Insurance Assistance Program (SHIP) for free personalized counseling.

●      Check if you qualify for extra help. If you have limited income and resources, you may be eligible for extra help from Medicare to pay for your Part D plan premiums, deductibles, and co-pays. This program is also known as the Low-Income Subsidy (LIS) or Medicare Savings Program (MSP). You can apply for extra help online at Social Security, by phone at 1-800-772-1213, or at your local Social Security office. You can also contact your State Medicaid Program to see if you qualify for an MSP.

●      Take advantage of other savings opportunities. There are other ways to lower your out-of-pocket costs for prescription drugs, such as:

• Using generic drugs or preferred brand-name drugs that are on your plan's formulary.
• Asking your doctor if there are lower-cost alternatives to your current medications.
• Using mail-order pharmacies or preferred retail pharmacies that offer lower co-pays.
• Enrolling in a Medicare Advantage plan that includes Part D benefits and may offer additional savings or benefits.
• Joining a Medicare drug discount card program that offers discounts on certain drugs at participating pharmacies.
• Applying for patient assistance programs or manufacturer coupons that may offer free or low-cost drugs to eligible individuals.

Prescription drugs can be a major expense for Medicare beneficiaries, but they do not have to be!\

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Take these steps to avoid the Medicare enrollment trap and save money on your medications:

1. Enroll in Part D when you are first eligible, 
2. Compare plans every year, check if you qualify for extra help
3. Take advantage of other savings opportunities

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