How to Navigate Medicare Part D Enrollment

Key Takeaways

• There are two main enrollment periods for Part D coverage: Medicare Initial Enrollment Period and Open Enrollment.

• The late enrollment penalty is added onto monthly premiums if you go 63 days or more without creditable drug coverage and don’t enroll during your Initial Enrollment Period.

• Take your Medicare Card, photo ID, and your Part D plan membership card to the pharmacy the first time you pick up your prescription after enrolling.

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  Should I Enroll in Medicare Part D?

  You should consider all your options before you enroll in prescription drug coverage. Even if you don’t take a lot of medications currently, it could be beneficial to enroll in a plan during your Initial Enrollment Period.  

  You should consider Part D if you enroll in Original Medicare and you:

  • Have a regular prescription drug need.

  • Will have a prescription drug need in the future.

  • Have trouble paying for your current prescription drug needs.

  • Do not have prescription drug coverage.

  • Want to avoid a late enrollment penalty in the future.

How to Sign Up for Medicare Part D

After you have decided to join a prescription drug plan, it’s essential to understand the enrollment process. First, you need to enroll in Medicare. Then you can enroll in a Part D plan during a valid enrollment period. 

• You join a Part D plan through a private carrier. 

• You must live in the coverage area of the plan you select. 

• You can enroll through Marketplaces like GoHealth. 

You can enroll in a standalone Part D plan or switch from Original Medicare to Medicare Advantage.

When Can I Apply for Medicare Part D?

There are two main enrollment periods for Part D coverage: Medicare Initial Enrollment Period and Open Enrollment.  You can also enroll during the Special Enrollment Period if you qualify. Let’s take a look at the specific dates for when you can enroll.

Medicare Initial Enrollment Period

If you’re new to Medicare, you can enroll in a prescription drug plan during the seven-month Initial Enrollment Period.

• You can enroll three months before your 65th birthday month. Coverage begins the first day of your birthday month.

• You can enroll the month of your birthday. Coverage begins the first day of the month after your birthday.

• You can enroll three months after your birthday month. Coverage begins the first day of the month after enrollment.

For example: Let’s say you turn 65 on July 10. Your Initial Enrollment Period begins April 1 and ends October 31.

Open Enrollment

After your Initial Enrollment Period, you can enroll in Part D during Open Enrollment unless you qualify for a Special Enrollment Period. The Open Enrollment Period for Medicare and Part D is October 15 to December 7. Your new coverage starts in January.

Special Enrollment Period

The Special Enrollment Period is the only time you can enroll in a Part D plan outside of the Initial Enrollment Period and Open Enrollment.

You can qualify for the Special Enrollment Period if:

• You move outside of your plan’s service area.

• You lose your current drug coverage.

• Your plan terminates or changes its contract with Medicare.

• You move into or out of a nursing home.

• You qualify for Extra Help and more.

What Is the Late Enrollment Penalty?

The late enrollment penalty applies if you go 63 days or more without creditable drug coverage after your Initial Enrollment Period. Creditable drug coverage is required to cover the same costs as Medicare Part D. Employer group plans or unions usually provide those policies.

The penalty encourages Medicare beneficiaries to enroll in a Part D plan as soon as they are eligible. Even if you don’t take any medications when you enroll in Medicare, it may pay off to enroll in an inexpensive plan, so you have coverage when you need it. 

Calculate the late enrollment penalty by multiplying 1% of the national average premium by the number of eligible months you went without Part D insurance. Then, round to the nearest ten cents. 

Example: Let’s say you went 21 months without creditable coverage.

Here’s how to calculate the penalty:

.21 (multiply 1% by the number of months you went without coverage even though you were eligible to enroll) X $34.70 (2024 national base beneficiary premium)  = $7.30 ($7.29 before rounding to the nearest 10 cents)

The penalty cost is likely to change each year because the national premium average fluctuates. The late enrollment penalty usually lasts the entirety of your Part D plan.

What Happens After Enrollment?

After you’ve joined a Part D plan and you’re ready to pick up your first prescription, you should take as much information as possible to the pharmacy.

You should bring:

• Your Medicare Card (red, white and blue)

• Photo ID 

• Your Part D plan membership card

If you have more questions about enrolling in a Part D plan, connect with one of our licensed insurance agents. They will walk you through the process and help you enroll in the right plan.

Sources

• Special Enrollment Periods . Medicare.gov.

• Your Guide to Medicare Prescription Drug Coverage . Medicare.gov.

• Part D late enrollment penalty . Medicare.gov.

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