Medicare Part D (prescription drug coverage) is essential for anyone enrolled in Medicare. Additionally, it is equally important that both agents and enrollees understand the Medicare Part D enrollment periods.
IEP (Initial Enrollment Period)
The IEP ( Initial Enrollment Period) is the beneficiaries first opportunity to enroll in Medicare coverage, this includes Part D. IEP is a 7 month window that begins three months before the month the beneficiary turns 65. It includes their birthday month and ends three months after their 65 birthday month.
Individuals who are eligible for Medicare due to disability have an IEP that starts three months before their eligibility date and ends three months after their 25th month of disability benefits.
During this period, beneficiaries can either enroll in a standalone Part D plan or an MAPD (Medicare Advantage plan that includes drug coverage).
AEP (Annual Enrollment Period)
The AEP (Annual Enrollment Period), sometimes referred to as Open Enrollment, takes place annually from October 15 to December 7. During this time, beneficiaries can enroll in a Part D (PDP) plan if they miss their IEP. They can also switch from one Part D plan to another or enroll in an MAPD plan. As long as they have Part D coverage.
Please note: any changes in coverage made during AEP take effect on January 1st of the following year.
MA OEP (Medicare Advantage Open Enrollment Period)
This enrollment period runs from Jan 1 through March 31 each year and is only available to those already enrolled in a Medicare Advantage plan. This provides enrollees an additional opportunity to make changes to their current MA/MAPD plan.
During the MA OEP beneficiaries can change from one Medicare Advantage plan to another Medicare Advantage plan either with or without Part D coverage. They can also disenroll from a Medicare Advantage plan and go back to Original Medicare with the option to enroll in a stand alone Part D plan and a Medicare Supplement. Please note the beneficiary must have a guaranteed issue election or pass underwriting to enroll in a Medicare Supplement plan.
Watch a quick YouTube video on OEP best practices
SEPs (Special Enrollment Periods)
SEPs (Special Enrollment Periods) allow beneficiaries to make changes to Part D coverage outside the standard enrollment windows under specific circumstances, such as:
Losing other creditable drug coverage: If the enrollee loses employer sponsored coverage or their plan is discontinued in their service area, they have 63 days to enroll in a Part D plan after losing coverage.
Moving to a new service area: If the current plan isn’t available in their new location, the enrollee is eligible for an SEP.
Qualifying for Extra Help: Individuals eligible for Medicare’s Extra Help program can change their Part D plan once per calendar quarter during the first three quarters of the year.
LEP (Late Enrollment Penalty)
It’s important for beneficiaries to enroll in Part D coverage when first eligible to avoid the late enrollment penalty. The penalty applies if they go without creditable prescription drug coverage for a period of 63 consecutive days or more once their IEP is over.
The penalty is calculated based on how the beneficiary went without coverage and is added to their monthly premium amount for life.
How to choose the right plan
- It is imperative to check all medications to see which plan provides the best coverage for them. All plans have their own formulary.
- Compare the plans that cover the drugs best. Consider all costs for each plan. The cost includes the premium as well as deductibles, copays and coinsurance.
- Make sure the plan is in network the preferred pharmacy to ensure you get the best price.
- Because plan costs and coverage changes each year, it is important to review coverage options each year during the AEP.
- Ask for assistance from a licensed Medicare agent who is appointed with several area carriers to provide the best options for coverage. The medicare.gov tool is a good way to check prices but it cannot answer your specific questions.
Understanding Medicare Part D enrollment periods and rules can save money and ensure you have the coverage you need.
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