Medicare Part D, How it Works? Calculations - Session 1
There is a lot of confusion related to the working of the Medicare part D Plans.
Senior citizens may find it difficult to deal with the confusion related to the exact working scenario of the Part D insurance coverage.
Given below is a simple example of how Medicare Part D Insurance works.
Suppose, Sam spends an annual cost of $2610 on the drugs he need for whatever disease he is suffering from & he chooses a low premium plan which serves him with the standard Medicare drug plan but does not offer any coverage under the Donut Hole period.
Then the data about the year will go on as: •$310 will be paid as the initial deductible amount by Sam.
•Then starts the first co-payment stage, where he pays 25% of the total amount of $2300 [deducting $310 from the total amount of $2610].
Therefore the out of pocket cost which he pays in this period for the medicines is $575 [That is the 25% of the total cost $2300].
•Now as we can see that Sam has not reached the $2830 limit, he does not enters the donut hole.
Now, we can calculate the annual out of pocket cost of Sam [which does not include the monthly premiums he pays] in the following manner: $310 (Paid as initial deductible cost) + $575 (Paid as 25% out of pocket charges for the drugs)= $885 which even after including the low premium he pays each moth is less than the original cost of $2610 he had to pay if he had not opted for Medicare Part D Insurance Plan.
So, now it may be quite easy for you to understand the working of Medicare Part D plan & you can calculate the amount you will have to spend using the Part D program.
But we will be covering a similar example for a person who enters the donut hole.
So that you are cleared with the annual cost he will pay & then you can decide whether you can enter the Donut hole or not & how much will it cost you.
Senior citizens may find it difficult to deal with the confusion related to the exact working scenario of the Part D insurance coverage.
Given below is a simple example of how Medicare Part D Insurance works.
Suppose, Sam spends an annual cost of $2610 on the drugs he need for whatever disease he is suffering from & he chooses a low premium plan which serves him with the standard Medicare drug plan but does not offer any coverage under the Donut Hole period.
Then the data about the year will go on as: •$310 will be paid as the initial deductible amount by Sam.
•Then starts the first co-payment stage, where he pays 25% of the total amount of $2300 [deducting $310 from the total amount of $2610].
Therefore the out of pocket cost which he pays in this period for the medicines is $575 [That is the 25% of the total cost $2300].
•Now as we can see that Sam has not reached the $2830 limit, he does not enters the donut hole.
Now, we can calculate the annual out of pocket cost of Sam [which does not include the monthly premiums he pays] in the following manner: $310 (Paid as initial deductible cost) + $575 (Paid as 25% out of pocket charges for the drugs)= $885 which even after including the low premium he pays each moth is less than the original cost of $2610 he had to pay if he had not opted for Medicare Part D Insurance Plan.
So, now it may be quite easy for you to understand the working of Medicare Part D plan & you can calculate the amount you will have to spend using the Part D program.
But we will be covering a similar example for a person who enters the donut hole.
So that you are cleared with the annual cost he will pay & then you can decide whether you can enter the Donut hole or not & how much will it cost you.
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