How Medicare Plans Work
Medicare Prescription Drug Plans
Medicare Prescription Drug Plans are offered by insurance companies and other private companies approved by Medicare. They add coverage to:
- The Original Medicare Plan,
- Some Medicare Cost Plans,
- Some Medicare Private Fee-for-Service Plans, and
- Medicare Medical Savings Account Plans.
With a Medicare Prescription Drug Plan:
- Generally, you pay less for your prescriptions
- You will get a plan member card after you enroll. You use this card when you go to the pharmacy to get your prescriptions filled
- You will pay the copayment, coinsurance, and/or deductible, if any
If you have limited income and resources, you may get extra help to pay for your Medicare drug plan costs.If you want to compare Medicare Prescription Drug Plans, use the Medicare Prescription Drug Plan Finder.
Medicare Health Plans
Medicare Health Plans (like HMOs and PPOs) often cover prescription drugs. Medicare Health Plans include:
- Medicare Advantage Plans
- Other Medicare Health Plans
Medicare Advantage Plans (like HMOs and PPOs) that include prescription drug coverage as part of the plan are health plan options that are approved by Medicare but run by private companies. They are part of the Medicare Program. If you join a Medicare Advantage Plan you are still in Medicare.
With Medicare Advantage Plans:
- You generally get all your Medicare-covered health care through that plan.
- You may get extra benefits, such as coverage for vision, hearing, dental, and/or health and wellness programs.
- You usually will have to pay some other costs (such as copayments or coinsurance) for the services you get. Out-of-pocket costs in these plans are generally lower than in the Original Medicare Plan, but vary by the services you use.
- You may have to see doctors that belong to the plan or go to certain hospitals to get covered services.
- You dont need to buy a Medigap policy.
Medicare Advantage Plans include:
- Health Maintenance Organizations (HMO)
- Preferred Provider Organizations (PPO)
- Private Fee-For-Service (PFFS) Plans
- Medicare Medical Savings Account (MSA) Plans
- Medicare Special Needs Plans (SNP)
Other Medicare Health Plans
There are some types of Medicare Health Plans that include prescription drug coverage as part of the plan but that arent part of Medicare Advantage that are still part of the Medicare Program. With these plans, you generally get all your Medicare-covered health care through that plan.
- Medicare Cost Plans
- Demonstrations/Pilot Programs
- PACE (Programs of All-inclusive Care for the Elderly)