All Medicare prescription drug plans must make sure their members can get the medically-necessary drugs they need to treat their conditions. By law, Medicare Part D plans must cover at least two drugs in each therapeutic class of drugs, in addition to certain vaccines and diabetes supplies. Medicare also requires Part D plans to cover almost all drugs in the following six classes: anti-psychotics, anti-depressants, anti-convulsants, immunosuppressants, cancer, and HIV/AIDS drugs.
A Part D drug or vaccine is one that is:
- Available only by prescription
- Approved by the FDA
- Sold and used in the United States
- Used for a medically accepted condition
- Not covered under Part A or Part B
Medicare Part D coverage at a glance
|These items are covered by Part D||These items are not covered by Part D|
|Prescription drugs||Drugs for anorexia, weight loss / weight gain|
|Biological products||Drugs that promote fertility|
|Most prophylactic vaccines (e.g., shingles, tetanus, tuberculosis)||Drugs for the relief of coughs and colds|
|Insulin and supplies associated with the injection of insulin (syringes, needles, alcohol swabs, and gauze)||Drugs for cosmetic purposes or hair growth|
|Prenatal vitamins and fluoride preparations||Drugs for sexual or erectile dysfunction (ED)|
|Barbiturates used for treatment of epilepsy, cancer, or certain mental health disorders||Prescription vitamins and mineral products, except as noted within the plan's formulary|
What is a prescription drug plan formulary?
Each Medicare drug plan has its own formulary, which is a list of drugs covered by the plan. Because every formulary is different, it's important to check the formulary to see if your medications are covered by the plan. Most plans provide access to their formulary on their website; you can also request a copy by calling the plan's customer service number.
Medicare Part D plans are allowed to change their formularies each year. They can also change their formularies during the year if drug therapies change, new drugs are released, or new medical information becomes available. If a formulary change affects a drug you are taking, or your drug is moved to a higher cost-sharing tier, your plan must notify you at least 60 days in advance. (This 60-day rule does not apply if a drug is removed from the market due to safety reasons or is determined to be a non–Part D drug.) Depending on the change, you may have to pay more for the drug or switch to a new medication. In some cases, you can continue taking the drug you were on until the end of the year. You can also ask for an exception if your doctor says an alternative drug is not right for you, provided the drug is a Part D drug.
What are drug tiers?
Many Part D plans place drugs into different cost-sharing "tiers" as a way to encourage greater use of lower-cost drugs, such as generic drugs. A drug in a lower tier will cost you less than a drug in a higher tier. If your doctor prescribes a drug on a higher tier rather than a similar drug on a lower tier, you may be able to file an exception and get a lower copayment.
Here's an example of how a plan might divide its drug tiers:
- Tier 1–Most generic drugs. Tier 1 drugs will cost you the least amount.
- Tier 2–Preferred brand-name drugs. Tier 2 drugs will cost you more than Tier 1 drugs.
- Tier 3–Non-preferred brand-name drugs. Tier 3 drugs will cost you more than Tier 1 and Tier 2 drugs.
- Tier 4–Specialty drugs. Tier 4 drugs are typically unique, very high-cost drugs, and will have the highest copayment or coinsurance.
What are Part D coverage rules?
Most Part D plans use coverage rules, or limits on coverage, for certain prescription drugs. Coverage rules ensure members use these drugs correctly and only when medically necessary, and also help control drug plan costs.
Prior Authorization— If your plan requires prior authorization for a medication you are taking, you or your doctor will need to contact the plan before you can fill your prescription. Your doctor will have to show that there is a medically-necessary reason why you must use that specific drug in order for it to be covered by your plan.
Step Therapy—Step therapy refers to a policy that requires you to first try similar, lower-cost drugs that have been proven effective for most people with your condition before you can "step" up to a more expensive drug. If you have already tried a lower-cost drug and it didn't work, or your doctor believes your condition makes it medically necessary for you to take the more expensive medication, he or she can contact your plan to ask for an exception to this coverage rule.
Quantity Limits—Plans may limit the amount of drugs they will cover for you over a certain period of time for safety and cost reasons. For example, a plan may cover only a 30-day supply of heartburn medication. If you need more, your doctor may need to provide more information about your medical condition to the plan.
What if my plan does not cover my prescription drugs?
If you are a member of a Part D plan or a Medicare Advantage Plan with prescription drug coverage, you have rights and options if your medication is not listed on your plan's formulary:
- You can ask your doctor if you can switch to another drug that is on the formulary.
- You can ask your plan for an exception to cover your drug. To ask for an exception, you or your doctor must provide a written statement that supports a medical need for the drug. You can request an exception if:
- Your doctor believes you need a drug that is not on the formulary
- Your doctor believes that a coverage rule should be waived.
- You believe you should be able to get a non-preferred drug at a lower copayment because you can't take any of the alternative drugs on list of preferred drugs.
- You can pay out of pocket for the drug and request that the plan reimburse you by asking for an exception.
If you are a new member of a plan, you may be able to get a temporary supply of a drug you were taking when you first joined the plan if it isn't on the formulary. Under this "transition policy," the plan will cover a temporary supply (typically about 34 days) if you need a refill during the first 90 days of your new membership in the plan. Part D transition policies cannot be used to buy a non–Part D drug or to get a drug out of the plan's network, unless you qualify for out-of-network access.