5 Things to Know About Medicare Drug Coverage Rules

Every section of Medicare is heavily regulated by rules and regulations. The rules are divided into three parts:

  • Federal laws, rules and regulation
  • State laws, rules and regulations
  • Insurance company's rules and regulations

By signing up for a Medicare Drug Plan you are agreeing to abide by the rules and regulations. Frankly it can be very confusing. Here are 5 things you need to know about Prescription Drug Plan Rules to make the process a bit easier.

  1. Enrollment Dates Matter!
    Pay attention to enrollment dates and rules to avoid incurring an Enrollment Penalty. You may enroll during your 7-month Open Enrollment Period. You can also enroll 60 days before or 63 days after loosing creditable coverage from another source to avoid the Enrollment Penalty. The penalty is calculated at 1% of the base premium per month that you haven't enrolled but could have. This amount (up to 12% a year) is then added onto your premium for the duration of your plan.
  2. Preauthorization for Prescriptions
    The insurance company can require prior approval for prescriptions and all prescriptions must be medically necessary to be covered.
  3. Quantity Limits
    The insurance company has the right to impose quantity limits. They can limit the amount of drugs that you get at one time.
  4. Step Therapy
    The insurance company has the right to make you submit to Step Therapy. Step Therapy is a process in which you are required to try cheaper drugs for your condition to see if they work or not. Your doctor can ask for an exception if he/she thinks Step Therapy would adversely affect your health.
  5. You have rights!
    You have rights protected under Federal and State laws. You can file an appeal if you disagree with payments, the quality of care or coverage. Know your rights and speak up!