Below is a summary of Medicare’s Part D prescription drug program costs for 2010.
See our Prescription Drugs section for more information on Medicare Part D.
For the ‘standard’ Part D plan:
- Annual Deductible: $310 (Beneficiaries who do not qualify for the low-income subsidy (LIS) must pay 100% of drug costs until they reach the deductible)
- Initial Coverage Period: drug costs between $310-$2,830 (Beneficiaries must pay 25% of their drug costs, which is $630, and their Part D plan pays the other 75%)
- Coverage Gap – Donut Hole: drug costs between $2,830 – $6,440 (Beneficiaries pay 100% of their drug costs, totaling $3,610)
- Catastrophic Coverage: drug costs >$6,440 (Beneficiaries pay the greater of either 5% of their drug costs or a copayment of $2.50 for generics and $6.30 for brand name drugs; their Part D plan pays the other 95%)
The total true out-of-pocket (TrOOP) costs before catastrophic coverage kicks in for 2010 is $4,550 ($310 + $630 + $3,610)
People who qualify for the full low-income subsidy (LIS) will have drug copayments of $1.10 and $3.30 for generics and brand name drugs respectively. People who qualify for the partial LIS will have copayments of $2.50 for generics and $6.30 for brand name drugs.
The national average premium for 2010 is $31.94.
The California benchmark plan premium is $28.99. Benchmark plans are Part D plans with monthly premiums below the California average. Beneficiaries who qualify and have the full LIS do not pay a premium or deductible if they enroll in a benchmark plan; they are, however, still responsible for paying their drug copayments.
Beneficiaries with the LIS who enroll in a Part D plan with premiums higher than the benchmark must pay the difference between the subsidy ($28.99 in 2010) and the plan’s premium.
See our section on Prescription Drugs for more info.