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Medicare provides prescription drug coverage for people who are eligible for Medicare alone, and for those who are eligible for both Medicare and Medicaid. "Dual eligibles" are the group of Medicare eligibles who also qualify for Medicaid. The following information is from Centers for Medicare & Medicaid Services (CMS), and is current as of December 12, 2008.

Prescription Drug Coverage: Basic Information

What is Medicare prescription drug coverage?
Medicare prescription drug coverage is insurance that covers both brand-name and generic prescription drugs at participating pharmacies in your area. Medicare prescription drug coverage provides protection for people who have very high drug costs or from unexpected prescription drug bills in the future.

Who can get Medicare prescription drug coverage?
Everyone with Medicare is eligible for this coverage, regardless of income and resources, health status, or current prescription expenses.

When can I get Medicare prescription drug coverage?
You may sign up when you first become eligible for Medicare (three months before the month you turn age 65 until three months after you turn age 65). If you get Medicare due to a disability, you can join from three months before to three months after your 25th month of cash disability payments. If you don't sign up when you are first eligible, you may pay a penalty. If you didn't join when you were first eligible, your next opportunity to join will be from November 15, 2008 to December 31, 2008.

How does Medicare prescription drug coverage work?
Your decision about Medicare prescription drug coverage depends on the kind of health care coverage you have now. There are two ways to get Medicare prescription drug coverage. You can join a Medicare prescription drug plan or you can join a Medicare Advantage Plan or other Medicare Health Plan that offers drug coverage.

Whatever plan you choose, Medicare drug coverage will help you by covering brand-name and generic drugs at pharmacies that are convenient for you.

Like other insurance, if you join, generally you will pay a monthly premium, which varies by plan, and a yearly deductible. You will also pay a part of the cost of your prescriptions, including a copayment or coinsurance. Costs will vary depending on which drug plan you choose. Some plans may offer more coverage and additional drugs for a higher monthly premium. If you have limited income and resources, and you qualify for extra help, you may not have to pay a premium or deductible. You can apply or get more information about the extra help by calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778) or by visiting www.socialsecurity.gov on the web.

Why should I get Medicare prescription drug coverage?
Medicare prescription drug coverage provides greater peace of mind by protecting you from unexpected drug expenses. Even if you don't use a lot of prescription drugs now, you should still consider joining. As we age, most people need prescription drugs to stay healthy. For most people, joining now means protection from unexpected prescription drug bills in the future.

What if I have a limited income and resources?
There is extra help for people with limited income and resources. If you qualify for extra help, Medicare will pay for almost all of your prescription drug costs. You can apply or get more information about the extra help by calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778) or visiting www.socialsecurity.gov on the web.

"I have Medicare and Medicaid, and I get my drug coverage from Medicaid."
As of January 1, 2006, Medicare covers your prescription drugs. The prescription drug coverage from Medicare has no premiums, no deductibles, and no gaps, and you will pay very little or nothing for almost all prescriptions. Once you are enrolled in a Medicare Prescription Drug Plan, you usually will remain in that plan if you don't take any action to change plans. If Medicare must assign you to a different prescription drug plan at any time, they will mail you a letter explaining the change and your options.

What you need to do
You should review your drug plan coverage regularly to make sure your current plan is meeting your needs. Each year, you should review your coverage and compare it to any new plans that might be available for the coming year. Decide which Medicare plan offers the prescription drug coverage you would like. When you are new to Medicare, if you do not sign up for a plan, Medicare will sign you up for one to make sure you do not miss a day of coverage. Medicare will send you a letter to let you know which plan you are in. You can switch to a different plan if you choose.

"I have limited resources and live on limited income."

What you need to do
If your resources are less than $11,710 (single) or $23,410 (married) and your income is limited, you may qualify for extra help paying for Medicare Prescription Drug Coverage. These resource limits are for 2007 and may increase each year. The resource limits include $1,500 per person for burial expenses. Resources include your savings and stock, but not your home or car. If you haven't received an application or information about the extra help, and you think you may qualify, you should apply.

You can apply online by visiting the Help With Medicare Prescription Drug Plan Costs section on the Social Security Administration website.