Medicare Part D Coverage, Enrollment, Eligibility Requirements for 2022

What is Medicare Part D? Before you enroll in a Medicare Prescription Drug Plan, it pays to understand exactly what you’re getting. Medicare Part D is known as Medicare prescription drug coverage. It can be confusing with all of the different plans available. 

What Is Medicare Part D?

Medicare Part D is the prescription drug coverage program available through Medicare. It’s a voluntary program you can choose to enroll in if your doctor prescribes medications covered by Medicare Part D.

How Does Medicare Part D Drug Plans Work?

Medicare Part D plans work much like any other insurance plan. The insurance company negotiates with pharmaceutical companies so they can offer discounted prices on prescription drugs for their members. In return, they require you to meet certain criteria before they’ll cover your prescriptions — such as paying a deductible before they begin paying anything at all or paying co-insurance after they’ve paid their share of the cost of your prescriptions (usually 20%).

Deductible Stage

Under the deductible stage, you pay full costs until you reach the deductible. 

Initial Coverage Stage

The initial coverage stage begins after you’ve paid your deductible and ends once you reach the catastrophic coverage gap. 

Coverage Gap Stage

The gap stage ends once you’ve spent $7,050 on prescription drugs in one calendar year. Until you’ve spent that money, the gap stage usually pays 75% of the prescription cost regardless of whether it is generic or brand name medication. Once your costs exceed $7,050, then you move to the catastrophic coverage stage. 

Catastrophic Coverage Stage

In the catastrophic coverage stage, Medicare pays 95% of your prescriptions until you reach the out-of-pocket limit for that year.

Special Considerations

Medications not on the Formulary list require payment of 100% of the cost, and this expenditure does not contribute to your deductible. It is definitely in your best interest to try and only use medications on the Formulary list. There is an exception process if you need the non-formulary medication. However, there is no guarantee the exception will be approved. 


If you are eligible for Medicare, you are eligible for Part D. You must be enrolled in both Part A and Part D for MAPD (Medicare Advantage Prescription Drug Plan). For standalone plans, you need to be enrolled in Part A or Part B.

Who Needs to Enroll in Medicare Part D Drug Plan?

Suppose you’re eligible for Medicare and have no other coverage available to pay for your prescriptions. In that case, it’s important to enroll in a Medicare drug plan as soon as possible so that you can get access to these medications when needed. If you don’t enroll in a plan by the CMS (CMS) deadlines, you’ll face penalties or other repercussions for not doing so.

Some people don’t need to enroll, such as persons still employed and covered by an employer plan, persons receiving VA benefits, those covered under Tricare for life, and persons receiving drug benefits from an employer or union as a retiree.

When Can Coverage Changes Be Made?

You can make changes to your Medicare Part D coverage until December 31st each year; however, any changes made after this date will not take effect until January 1st of the following year.


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