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Medicare Rx Options

HOP offers two Medicare Prescription Drug Coverage Options. You can choose one of these plans with medical coverage or on a standalone basis:

  • Basic Medicare Rx Option, which provides the minimum level of Medicare Prescription Drug coverage required by Medicare
  • Enhanced Medicare Rx Option, which provides coverage for additional drugs and provides a 50% cost sharing in the “coverage gap”

Both the Basic and Enhanced Medicare Rx Plans include a “formulary.” Medicare requires plans to submit a formulary list of drugs to be covered under an approved Medicare prescription drug plan. We developed a custom formulary (list of covered medications) that covers almost all of the medications that current HOP participants had filled over the last year. Not all drugs are included under the Basic and Enhanced Medicare Rx Options. Generic drugs for covered categories are always included.

For more information about the Basic and Enhanced Medicare Rx Options, refer to the many Medicare Rx resources on this site:

Who is eligible for Medicare Prescription Drug Coverage?

Medicare Prescription Drug Coverage is available to anyone with Medicare (including individuals eligible for Medicare due to being age 65 or older or due to disability or end-stage renal disease). No physical exams are required. Nobody can be denied for health reasons.

If I'm Medicare eligible, am I required to sign up for Medicare Prescription Drug Coverage?

No. It's voluntary. However, if you do not sign up when you are first eligible or do not have other creditable coverage, you may have to pay a premium penalty when you sign up later.

Is there much difference between the different Medicare Prescription Drug Plans?

Yes. There are differences in premiums and deductibles, covered drugs, copays, and participating pharmacies. The costs for plans vary. Carefully compare plans in your area.

When does the late enrollment penalty apply?

You may be subject to a penalty in the form of a higher premium rate if you go 63 days or longer without prescription drug coverage that is at least as good as standard Medicare Prescription Drug Coverage (or creditable coverage). The premium increase will be 1% per month for every month after you are eligible for but did not have Medicare coverage. You will have to pay this higher premium as long as you have Medicare Prescription Drug Coverage.

Who is eligible for the low-income subsidy for Medicare Prescription Drug Coverage?

There is extra help for people with lower income and assets who are enrolled in Part D. Depending on the level of need, premiums, deductibles, coinsurance, and/or copayment amounts may be reduced or eliminated.

Eligibility for extra help depends on your income (money you receive from retirement benefits or other money that you report for income tax purposes) and, in some cases, your assets (for example, property other than your residence). If you have both Medicare and Medicaid, you automatically qualify for this extra help. If you do not have Medicaid, you may still qualify for some assistance if your income and other assets are below certain levels.

In certain cases, the Centers for Medicare and Medicaid Services (CMS) systems do not reflect a beneficiary's correct low-income subsidy status. To address this issue, CMS created the best available evidence (BAE) policy. This policy requires sponsors to establish the appropriate cost-sharing for low-income beneficiaries when presented with evidence that the beneficiary's information is not accurate. For more information about the best available evidence policy, click here.

If you think you might qualify for extra help and have not yet been contacted, you can contact the Social Security Administration. A worksheet is also available on their Web site that can help you determine whether you may qualify. Information can be found on the Social Security Web site at www.socialsecurity.gov/prescriptionhelp.

What's the "coverage gap"? Do the HOP Enhanced and Basic Medicare Rx Options have a coverage gap?

Under the Basic Medicare Prescription Drug Coverage, once your total drug costs (what your plan has paid plus your deductible and copays) exceed $2,700, Medicare will not cover any more covered expenses in the year until you spend $4,350 out of pocket. This gap in coverage is called the "coverage gap." When you reach the $4,350 limit, catastrophic drug coverage kicks in automatically and your plan pays 95% of your remaining costs until the end of the year.

Under the Enhanced Medicare Prescription Drug Coverage, once your total drug costs (what your plan has paid plus your deductible and copays) exceed $2,700, Medicare will cover 50% of the cost of covered expenses up to the maximum plan payment ($100 for up to an 83-day supply and $300 for over an 83-day supply) in the year until you spend $4,350 out of pocket. This gap in coverage is called the "coverage gap." When you reach the $4,350 limit, catastrophic drug coverage kicks in automatically and your plan pays 95% of your remaining costs until the end of the year.

What types of drugs are covered under Part B versus Part D of Medicare?

Click here to see a list of drugs covered under Part B versus Part D of Medicare and click here for more information about Medicare Part B and Part D coverage issues.

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