Do I need to enroll in Medicare Part D Prescription Drug coverage?
According to the Centers for Medicare and Medicaid Services (CMS), those aged 65 and above should enroll in Part D during their initial enrollment period. Clients often wonder why they need this coverage if they don’t currently take prescription medications. The reason is simple: it helps avoid penalties should the need for coverage arise in the future. The penalty is calculated by multiplying 1% of the “national base beneficiary premium” ($34.70 in 2024) by the number of months without Part D or creditable coverage. This penalty is added to the monthly premium when you eventually enroll in Part D.There are two ways to avoid this penalty:
- If you have creditable drug coverage through your employer, you are exempt from enrolling in Part D initially. You won’t face a penalty if you sign up for a Part D plan when your employer coverage ends or is no longer creditable. Check with your HR department to confirm if your employer coverage is creditable.
- Another way is to enroll in a stand-alone prescription drug plan or a Medicare Advantage plan that includes prescription drug coverage. If you opt for a Medicare Supplement plan (Medigap), you must also enroll in a stand-alone prescription drug plan.
Understanding the enrollment timing and coverage options for prescription drugs can be complex. Contact us today to schedule an appointment for assistance.
