I don't know about you, but it seems to me that whenever the government steps in to fix something, it ends up being a lot more complicated than it started out. Take Medicare for example. Once the federal government got their hands out of the pie, we ended up with a 28-page manual and a bunch of confused people.

Part "D" Explained

While the benefits from previous Medicare program came mainly through the government, benefits under Part D come through private health insurance plans, which in turn, get reimbursed by the Centers for Medicare and Medicaid Services. Currently, beneficiaries have two options to get the new Medicare Drug Plan. They can either join a Prescription Drug Plan (PDP), which only has drug coverage, or they can join a Medicare Advantage (MA) plan that covers prescription drugs.

Currently the country is split up into regions that carry each type of plan. There are 34 regions that carry PDP and 26 that carry MA. If you're not sure which region you're in, you can ask your primary care physician or your pharmacist.

In order to control costs of prescription drugs a tiered plan was implemented. For example: drugs that have been on the market for a long time, like Prozac, might be classified as a Tier 1, or inexpensive drug. Prescription drugs go up in tiers based on how much they cost. In addition, generic drugs are also covered under this plan so it's wise to ask your primary care physician if you can switch to a generic substitute for any of the medications you're currently taking.

What you Need to Know About Enrollment

Your need to enroll in one of these plans depends largely on the type (if any) of health care coverage you have now as well as your financial state. Obviously, billionaires aren't concerned with the cost of their medications.

When the program was initially rolled out, seniors had until May 16 of 2006 to sign up. If you didn't make that deadline, don't worry. You're still eligible, but will have to pay a 1% per month penalty based on the average cost of the premium you sign up for. Or if you can wait, the next enrollment period begins on November 15, 2006.

Prescription drug costs are constantly on the rise and, for many seniors, it often means choosing between essentials and their meds. Part D has a standard benefit structure that requires beneficiaries to pay a $250 deductible. In addition, 25% of the cost of any drug covered by Part D must also be paid up to a $2250 limit.

Part D Negatives

If there's one large flaw with Medicare Part D it is known as the "donut hole". This refers to another deductible the beneficiary has to pay once they reach their initial coverage limit. When this occurs, they're responsible for paying the full cost of their medication. If their out-of-pocket costs for drugs reaches $3600 for the year, with the deductible included, the beneficiary reaches what's termed "catastrophic coverage". With catastrophic coverage you would be required to pay $2 for a generic or preferred drug and $5 for other drugs, or 5% coinsurance, whichever is the higher of the two.

The Safety Net

Despite the relatively low cost of using Medicare Part D there are a significant number of senior citizens who can't afford it. For those people, an option to receive their prescriptions free of charge directly from the pharmaceutical companies is available. In order to qualify for this program:

• Seniors can't be carrying any health insurance that offers prescription drug coverage. Members of HMOs that offer prescription drug coverage COULD qualify if they reach the annual pharmacy limit.
• Seniors can't be enrolled or qualify for any government program that covers prescription meds such as Medicaid.
• Each pharmaceutical company has guidelines regarding income and seniors are required to meet these guidelines in order to qualify for the program. As a general rule though, your annual income for an individual should be below $16,000 and for a couple, below $26,000.

More Information

If you don't feel like ordering or downloading the 28-page manual (and I don't blame you), but want more information on everything involved with Medicare, the best resource by far is the official website at http://www.medicare.gov/. Or if you'd like an independent source try the AARP website at http://www.aarp.org/.

In addition to these online sources, your doctor or pharmacist is most likely up on all the changes made recently to Medicare and would be happy to answer any questions as well as help you choose which plan is right for you.