Medicare and Brand-Name Prescription Drugs
Medicare Part D provides optional prescription drug coverage for Medicare beneficiaries. Available from private, Medicare-approved insurance companies, Medicare Prescription Drug Plans may cover brand-name as well as generic prescription drugs.
What is a brand-name prescription drug?
A brand-name drug is a medication researched and developed by a pharmaceutical company and then patented to protect against other companies making copies and selling the drug.
A generic drug, according to the Food and Drug Administration (FDA), is equivalent to a brand-name drug in “dosage, safety, strength, how it is taken, quality, performance, and intended use.” For example, “ibuprofen” is the generic name of the brand-name drug “Advil.” Generic drugs usually cost less than their brand-name equivalents.
Generics generally become available after being approved the FDA and after the patent or other periods of exclusivity expires on a brand-name drug equivalent. According to the FDA, today nearly 8 in 10 prescriptions are filled with generic drugs.
Medicare Prescription Drug Plans
Original Medicare, Part A and Part B, does not include most prescription drug coverage. Medicare Part A may cover prescription drugs you receive as a hospital inpatient, while Medicare Part B covers certain prescription drugs administered to you as an outpatient – often drugs you wouldn’t take on your own, such as infusions. For coverage of most medications you take at home, you can enroll in a Medicare Prescription Drug Plan from a private, Medicare-approved insurance company. You can get this coverage in two different ways:
- A stand-alone Medicare Part D Prescription Drug Plan, which works alongside your Original Medicare coverage.
- A Medicare Advantage Prescription Drug plan, which includes all the same benefits as Medicare Part A and Part B (except for hospice care, which is still covered under Medicare Part A), as well as prescription drug coverage, and may include other benefits, such as routine vision care.
Every Medicare Prescription Drug Plan maintains its own formulary, or list of covered drugs. Formularies are organized in tiers, or levels, with lower-numbered tiers generally including lower-priced drugs and higher tiers including more expensive drugs. Lower tiers often include generic drugs. A plan’s formulary may change at any time. You will receive notice from your plan when necessary.