Medicare Part D - Prescription Drug Tiers

Question 1

Medicare Part D drug Coverage will have either 5 or 6 tiers to classify your medications.

Answer 1

As you go from Tier 1 through Tier 5, the cost increases. Tier 1 is the least expensive and Tier 5 is the most expensive. Then, Tier 6 is almost like Tier 1 in that medications may be priced at a low cost (after a deductible might apply).

For covered medications, you will either pay a copay (a specific dollar amount) or a coinsurance (a percentage of the drug’s total cost).

REMEMBER:

Copay = a dollar amount ($)
Coinsurance = a percentage of the total cost (%)

Note: If you medication is NOT classified in drug tier (Tiers 1 through 6), then it is NOT covered by your plan’s formulary list of drugs. You will therefore pay the full cost of the drug and it will not run through whatever plan you have. That is why you should:

• Get the best deal you can:
  
  • Find a GoodRx coupon.
  • Use Mark Cuban’s Cost-Plus Drugs program, for example.
  • or go directly to the manufacturer of the drug

NOTE: A Part D drug plan’s formulary list of drugs can change each year, as well as the tiers each medication is classified it. Be sure to check each Annual Election Period (Or Open Enrollment) before your plan renews for the following year.

Question 2

Tier 1 - Preferred Generic:

Answer 2

• Normally inexpensive drugs.
• typically a very small copay or possibly even no copay at all.
  -Usually you never pay a coinsurance in Tier 1 - Preferred Generic

Question 3

Tier 2 - Generic:

Answer 3

• These are more expensive generics or sometimes lower-cost brand name drugs.
• Depending on you plan, these medications could be the same cost as Tier 1 or a little higher.
• You will pay either a copay or a coinsurance.

Question 4

Tier 3 - Preferred Brand:

Answer 4

• These medications are typically name band drugs still under patent.
• Expect to pay a higher cost for the medications.
• You will pay either a copay or a coinsurance.

Question 5

Tier 4. - Brand:

Answer 5

• These are more expensive name brand medications.
• Definitely expected to pay higher prices for these medications.
• It’s almost always a coinsurance percentage but some plans have a copay setup.

Question 6

Tier 5 - Specialty:

Answer 6

• These are you very expensive specialty medications.
• Be prepared for some pretty high medication costs.
• You definitely will pay a coinsurance percentage for medications.

Question 7

Tier 6- Select (or Select Care)

Answer 7

• These are inexpensive generic medications used to treat long-term health conditions (such as high blood pressure, diabetes, and high cholesterol).
• Generally no copay for these medications; and no coinsurance as well.

This is considered the “Wild Card” tier because of the surprising low cost of some medications that fall into this tier causing the beneficiary to not have to pay anything at all.