More than 70% of people enrolled in Medicare are also enrolled in Medicare Part D, which covers prescription drug costs. Medicare Part D’s enrollment has more than doubled since 2006, and if you want to join these 45 million people currently enrolled, there are some points to be aware of before you choose one particular company over another. We’ve researched and compared over 20 companies to find the five best and to help you decide on a plan that’s right for you.
How to Shop for the Best Medicare Part D Drug Plan
Step 1: Sign Up as Soon As You Are Eligible
Unlike Parts A and B, Part D drug coverage comes from private insurance companies, with Medicare paying a portion of the costs. You need to sign up as soon as you're eligible—if you don't, you may have to pay a late enrollment penalty later when you do enroll.
Step 2: Make a List of Which Prescriptions You Will Need to Have Covered.
Medicare Part D plans have a list of medications called a "formulary," detailing what medications they cover; every plan has to cover at least two drugs that are the most commonly prescribed. If a formulary doesn’t cover your prescription, it may cover a similar or generic medication (think Tylenol vs acetaminophen, or Prozac and fluoxetine). Your doctor may also be able to negotiate an exception.
Step 3: Compare the Difference in Cost Among Plans
Different plans offered by different companies have rates that can range from zero additional costs per month up to over $100 per month. This can depend on age, location, and other specific factors in your given situation.
Step 4: Consider Talking to a Broker or Consultant
Why wade through overwhelming information if you don’t have to? Engaging with a broker or a health insurance consultant is free. Brokers sometimes have access to more plans or better pricing and can use their connections with insurance companies to help find the best plan and coverage for you.
State Health Insurance Assistance Programs can be an excellent resource to help you find all the information you might need if you look for further help with insurance.
Step 5: Sign Up
You can enroll in a Medicare Prescription plan three different times: three months before, after, and inclusive of your birth month; three months before or after the first month you claim disability; or during the Medicare Open Enrollment, which in 2020 runs from October 15 through December 7.
You can change your coverage for the upcoming year, including your prescription drug coverage, during Fall Open Enrollment, any time between October 15 and December 7. Your new coverage would begin on January 1 of the upcoming year.
We selected the five companies below as offering the best Medicare Part D Drug Plan coverage (based on factors such as range of service, price, accessibility of their website or mobile app, and CMS star rating) to help you enroll in the plan that’s best for you. All companies we reviewed had plans available in at least 40 states, and they are further broken down to highlight each company’s best features.
The 5 Best Medicare Part D Plans for 2020
Best in Ease of Use: Humana
Humana’s smooth website and simple process for comparing plans make it a winner. When you look into Humana’s Part D offerings, the page automatically fills in your location data (if you have location services on) and immediately shows you the plans available in your area. You may also have access to preferred cost-sharing benefits when you fulfill your prescriptions at Walmart, making that plan cheaper than other options offered by Humana.
Extremely easy to get access to plan comparisons
Offers basic, moderate, and comprehensive plans, with costs and coverage that scale up from plan to plan
Alerts when your prescriptions are available with lower-cost, generic versions
Advertises other Medicare plans on the webpage for Part D enrollment
Requires separate mobile app (Humana Pharmacy) for managing prescriptions
Humana was rated the easiest to use for its genuine focus on making the health care application process as easy for its customers as possible. It doesn’t require you to click through several different windows to get the information you’re looking for as you try to apply; it’s all right there, easily accessible. Humana is also ranked highly with a positive rating of A- with AM best, meaning the company is financially stable. And, Humana has educational material on its website (including a downloadable brochure with guidance on how to pick the best plan for you). Live Humana associates are available via phone if you need help with any questions along the way.
Humana’s Walmart Value Rx plan, its most basic offering, is one of the least expensive plans in the country.
Best in Broad Information: Blue Cross Blue Shield
Unlike many other companies, Blue Cross Blue Shield doesn’t offer specific estimates on its main website based on your ZIP code, date of birth, and other information. It does, however, lay out the basics for Medicare and Medicare Part D right there on the page, and it also offers a downloadable PDF.
Detailed plan descriptions broken down by state
Very straightforward educational materials on the main website
Three different levels of coverage: Basic, Enhanced, and Enhanced Plus
No easily accessible price comparisons
Limited explanation on the difference between the three different levels of coverage
Not every state offers more than the Basic plan
Blue Cross Blue Shield clearly takes patient education seriously. It wants to provide accurate information from the start, and its approach and website are different from most other companies. Instead of offering estimates based on your personal information, Blue Cross Blue Shield provides lots of general, up-front information about Medicare and all its different Parts, including Part D. It also offers a state-by-state breakdown of offerings and who to contact for more information. Its quote process is not the most straightforward; if you visit your state’s Blue Cross Blue Shield website, you will be redirected to Anthem (Blue Cross Blue Shield’s parent company) to begin a more detailed quote process.
Best for Simplicity: Aetna
Aetna offers two different levels of Part D plans, with its website detailing in depth what each level covers, so that potential customers can clearly see what they get when they enroll. You’ll learn not only about the different levels Aetna offers, but also the levels other companies could be offering as well.
Easy-to-understand information about each plan type
Opportunities for gap coverage for some prescription medications
Plans with a $0 copay and $0 deductible available
Premiums can be a bit pricey (ranging from $21 to $58 for the Choice plan, and from $57 to $101 for the Plus plan)
Choice Plan deductibles for Tier 3 prescription drugs and above can have higher deductibles, ranging from $215 to $435
Aetna offers a straightforward breakdown of plans: SilverScript Choice and SilverScript Plus. The Choice Plan offers lower premiums but has moderately expensive deductible ranges. The Plus Plan offers a range of roughly double the cost of the Choice plan for monthly premiums, but with the promise of a $0 deductible for all levels of prescription medication (Tiers 1 through 5). The copays at preferred retailers are negligible for both plans; Tier 1 medications have a $0 copay, while Tier 2 has a $1 copay for the Choice plan and a $2 copay for the Plus plan. The Plus plan also offers "gap coverage" for the time between the end of one coverage and the beginning of another, and both Plans offer mail-delivery prescriptions. Aetna breaks this down clearly and simply, without complicating details. It’s also as simple as entering your ZIP code to see plans offered in your area for more personalized estimates.
Best in Number of Medications Covered: Cigna
Every company works from a "formulary," which is a list of prescriptions they cover. Cigna’s formulary includes more than 3,000 drugs, meaning there’s a much better chance that your medication is either covered or that you’ll be able to find an alternative option.
Big formulary list of covered medications
Low copays ($0 to $4)
Three plans offered (Essential, Secure, Extra)
Higher deductible ($435) for Tiers 3 though 5 for the Essential plan and for all Tiers of Secure Plan
Somewhat expensive premiums
Cigna won this category based on the sheer number of drugs on its formulary. Prescription medication is, after all, the whole point of a Part D Plan, so it’s important to have as many options for your medication as possible. It can be a relief to know the chances are better for the availability of your preferred medication, or at least one adequate alternative. While Cigna’s Part D Plan premiums can be a bit on the costly side, ($266 for the Essentials plan, $378 for the Secure plan, and $649 for the Extra plan, annually), this is balanced out by $0 or low copays, which can help you get your medication without breaking the bank. Cigna has been in business since 1792, so you know it has the historical understanding and background knowledge required to provide well-rounded care. Cigna’s A ranking with AM Best indicates that the company is financially strong as well.
Best in Education: AARP
AARP offers three well-rounded plans to its customers, with information written clearly at a level that anyone can understand, without being overwhelming or confusing. AARP even offers suggestions to match you with a plan, for example if you are looking for basic coverage or something more comprehensive. AARP also lists all of its different Medicare options available in your location if you want to look into them.
Information is easy to follow
Ability to review all different Parts of Medicare available in your area
Lots of educational materials on the website, including general Medicare information, AARP’s Medicare Plans, as well as enrollment questions
Must enter at least some of your medications to get an accurate personalized estimate of your costs
Higher deductibles (2 of the 3 plans begin at $435 a year)
Cannot split payments over multiple methods (e.g. half on a credit card and half on a debit card)
AARP is under the UnitedHealthcare umbrella now, though AARP was founded in 1958 and United Healthcare started in 1977. AARP was a trailblazer for the insurance of older people, especially since Medicare itself didn’t even exist until 1965. As such, AARP’s focus is 100% on patient understanding and comfort, and all of the information is written with you in mind. There are free Medicare guides available for download on its website, and it’s easy to compare plans or connect with an associate for more detailed information and assistance. AARP provides all the tools you need for a well-rounded understanding of Medicare.
Some medication may not be covered by all plans, and it can make a huge difference to the tune of thousands of dollars. Make sure you check and see which, if any, of AARP’s plans cover your medication, and how much you may have to pay for it.
How We Chose the Best Medicare Part D Companies
We began our search by looking into the biggest and most popular health insurance companies. We eliminated companies that didn’t serve at least 40 states, to make sure as many people as possible would be able to use this information to their best benefit. Then, we looked at key considerations like Medicare Star Rating, pricing, AM Best financial health ratings, ease of use for their tools and website, the amount of information presented, any extra benefits they might offer, and more to give you the best understanding of which Medicare Part D plan is right for you.
What Are the Benefits of Enrolling in a Medicare Part D Drug Plan?
Going without prescription coverage is seldom a good idea. Medicare offers several prescription plans to choose from, and there are also other options for prescription coverage outside of Medicare. One example is through private employers’ insurance.
What Is the Difference Between Medicare Part D and Medicare Advantage for Prescription Costs?
On average, prescriptions will be less expensive with a Medicare Advantage plan, and you have a better chance of having your medication covered. Medicare Advantage offers lower plan maximums and in some cases, lower monthly premiums, but Medicare Advantage does have “extras”—some of which you may not actually need if you just want prescription drugs and nothing else. Part D medications can be more expensive since they’re not “bundled” the same way Medicare Advantage is, but that’s not always the case. Prices vary drastically with both plans depending on the medicine in question, so it’s worth investigating both options to determine what will be best for your situation.
What Are the Benefits of Buying Prescription Coverage Through a Medicare Advantage Plan?
The biggest two benefits are in coverage and cost. A Medicare Advantage Plan is often less expensive in terms of prescription drugs since the plans are structured differently than a Part D plan. There’s also a longer list of medications that are covered with Medicare Advantage than you may find with Medicare Part D.
What Can I Expect to Pay for a Medicare Advantage Plan With Prescription Coverage?
Medicare Advantage and Part D costs can vary on a number of important factors: provider, location, and most importantly, what medications need to be covered, but the main difference between the two will be in the cost of medication. Some medications on Medicare Advantage may be more expensive than on Part D, but the opposite may also be true. It’s extremely important either way to check each plan thoroughly to determine which would get you the best deal on coverage in the long run because the difference in costs can be significant, with medications costing under $50 or over $500. It will also save you a lot of time to have a pre-made list of your medications handy, since each provider will likely ask for the details, and each will have different results depending on which plan you choose.
Can I Change My Medicare Advantage Plan to Medicare Part D?
If you’ve found Medicare Advantage not to your taste (for any reason), it’s easy to switch your coverage. You may switch from your Medicare Advantage Plan to a Medicare Part D Plan (or vice versa) during the enrollment period, which in 2020 goes from October 15 through December 7. You can change your plan during this time for the upcoming year.