Every Medicare Part D Plan (PDP) is different. Provided by independent insurance carriers, PDPs have different drug formularies (drug coverages) and premiums, however, all plans must follow the Standard Benefit Model Plan parameters established by The Centers for Medicare and Medicaid Services (CMS). The “Standard Benefit Plan” is the minimum allowable benefit a plan can offer.
Here are the highlights for the PDP Standard Benefit Plan for 2014:
- 2014 Initial Deductible: $310
- 2014 Initial Coverage Limit: $2,850
- 2014 Out-of-Pocket Threshold: $4,550
- 2014 Coverage Gap (donut hole): starts when you reach the plan’s initial coverage limit ($2,850) and ends when you reach the out-of-pocket threshold ($4,550).
- 2014 Donut Hole Discounts and Calculations: In 2014, Part D members receive a 52.5% discount on brand-name drugs while in the donut hole. The brand name drug manufacturer pays 50% of the cost. This amount is applied to your total out-of-pocket cost calculation to get you out of the donut hole. The additional 2.5% discount is paid by your Medicare Part D plan, but it does not count toward your TrOOP. Members pay a maximum 72% co-pay on all generic drugs while in the coverage gap.
- 2014 Minimum Cost-sharing in the Catastrophic Coverage Portion of the Benefit: increases to the greater of 5% or $2.55 for generic or a preferred, multi-source drug, and the greater of 5% or $6.35 for all other drugs.
- 2014 Maximum Co-payments below the Out-of-Pocket Threshold for certain Low Income Full Subsidy Eligible Enrollees: $2.55 for generic or preferred, multi-source drug, and $6.35 for all other drugs.