2017

PLAN
INFORMATION

Glossary

Throughout this website and in your printed materials, you may find terms relating to your Medicare Part D prescription drug plan that are not familiar to you. This glossary provides an alphabetical listing of definitions for many of these terms. You can scroll through the listing or skip to a section by selecting one of the letters below.

A

Abridged formulary

A partial listing of commonly used drugs covered by a Medicare Part D plan. It is periodically updated during the plan year.

Annual Coordinated Election Period

Also called Annual Enrollment Period. The time each year when anyone with Medicare Part A and/or Medicare Part B can enroll in or disenroll from a Medicare Part D prescription drug plan. This period runs from October 15 through December 7 each year for coverage that begins on January 1 of the following year. Some members may also be allowed to enroll or disenroll at other times of the year if they are eligible for a Special Enrollment Period.

Annual Enrollment Period

A set time each fall when members of a standard Medicare plan can change their health or drug plans or switch to Original Medicare. The Annual Enrollment Period is from October 15 through December 7.

Annual Notice of Changes

This annual mailing, which contains several communications, is provided to current members to explain changes to their benefit for the coming year.

Appeal

An appeal is something you do if you disagree with a plan's decision to deny a request for coverage of prescription drugs or payment for drugs you already received. For example, you may ask for an appeal if a plan doesn't pay for a drug you think should be covered. (Chapter 7 of your Evidence of Coverage explains appeals, including the process involved in making an appeal.)

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B

Biologicals

Medical preparations made using living organisms and their products, such as insulin and vaccines. Many of these are covered under Medicare Part D.

Brand-name drug

A prescription drug that is manufactured and sold by the pharmaceutical company that is responsible for the research and development of the drug. A brand-name drug has the same active ingredients as a generic equivalent drug. However, generic drugs are manufactured and sold by other drug manufacturers and are generally not available until after the patent on the brand-name drug has expired.

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C

Catastrophic Coverage Stage

The stage of coverage that follows the Coverage Gap. You reach this stage after your true out-of-pocket costs (what you and others on your behalf pay) for Medicare Part D drugs reach a certain amount specified by the Centers for Medicare & Medicaid Services. During this stage, you pay a low copayment or coinsurance for your drugs for the remainder of the calendar year. Your Evidence of Coverage describes the various stages of coverage in detail.

Centers for Medicare & Medicaid Services (CMS)

The federal agency that runs the Medicare and Medicaid programs.

Coinsurance

An amount you may be required to pay as your share of the cost for a prescription drug after you pay any deductible. Coinsurance is usually a percentage of the cost of the drug (for example, 20%).

Complaint

The legal term for “making a complaint” is “filing a grievance.” The complaint process is used for certain types of problems only. This includes problems related to quality of care, waiting times, and the customer service you receive. See also “Grievance” in this list of definitions.

Comprehensive formulary

A complete listing of all the drugs covered by a Medicare Part D plan. It is periodically updated during the year.

Coordination of benefits (COB)

A process that is used to determine the amount that different plans pay when a member has primary coverage through a Medicare Part D prescription drug plan and secondary coverage through one or more supplemental payers. Although a member cannot have more than one Medicare Part D prescription drug plan at a time, an employer or other plan sponsor may choose to provide additional coverage to an individual's Medicare drug benefit through a secondary plan.

Copayment

An amount you may be required to pay as your share of the cost for a prescription drug after you pay any deductible. A copayment is usually a set amount, rather than a percentage. (For example, you might pay $10 or $20 for a prescription drug.)

Cost-sharing

Amounts that you have to pay when drugs are received. (This is in addition to the plan's monthly premium.) Cost-sharing includes any combination of the following three types of payments: (1) any deductible amount; (2) any copayment; or (3) any coinsurance amount.

Coverage determination

A decision about whether a drug prescribed for you is covered by the plan and the amount, if any, you are required to pay for the prescription. A member or a member's authorized representative must formally request a coverage determination by calling or writing to the plan.

Coverage Gap

The Coverage Gap, also known as the "Donut Hole," is the third stage of coverage in the standard Medicare Part D plan. This stage begins when your total drug costs (the amount that both you and your plan pay) reach an amount specified each year by the Centers for Medicare & Medicaid Services (CMS). You will continue to pay less each year in this stage until the gap is closed by 2020. By then, you will pay only 25% of the cost for covered brand-name and generic drugs during the gap.

Covered drugs

A general term that refers to all of the prescription drugs covered by your plan.

Creditable prescription drug coverage

Prescription drug coverage (such as a plan offered by a current or former employer or union) that is expected to pay, on average, at least as much as the standard Medicare Part D prescription drug coverage. If you have this kind of coverage when you become eligible for Medicare, you can generally keep that coverage without paying a penalty if you decide to sign up for a Medicare drug plan after your Initial Enrollment Period.

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D

Deductible

In a standard Medicare Part D plan, a deductible is the amount that you must pay out of pocket for prescriptions before the plan begins to pay.

Disenrollment

The process by which your plan membership ends. Disenrollment can be voluntary (for example, when you change plans) or involuntary (for example, if you don't pay your monthly premiums). Generally you can voluntarily disenroll only during the Annual Enrollment Period (October 15 through December 7) unless you are eligible for a Special Enrollment Period.

Donut Hole

Another term for the Coverage Gap. In a standard Medicare Part D plan, the Donut Hole is the gap between the Initial Coverage Stage and the Catastrophic Coverage Stage when, under most Medicare drug plans, you are responsible for paying all of your prescription drug costs out of pocket.

Dosage form

The physical form in which a medication is made and taken. Common dosage forms include, for example, tablets, capsules, liquids, eye drops, ear drops, and so on.

Dosing schedule

The amount of a medication to take and how often to take it.

Drug tier

The level of coverage for each drug, for example, "generic drug tier" or "specialty tier drug." Your copayment or coinsurance will depend on which tier the drug is in. (You can find more information about drug tiers in your Evidence of Coverage and formulary.)

Dual eligible

When a person is entitled to both Medicare (Part A and/or Part B) and Medicaid. If you are a dual-eligible beneficiary, you probably qualify for Extra Help from the government to pay for your prescription drugs and have been automatically assigned to your plan.

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E

Evidence of Coverage (EOC)

The document that explains your coverage, rights, and responsibilities as a member of the plan, along with any rider and other attachments. It also defines the plan's obligations to you.

Exception

A type of review or coverage decision that, if approved, allows you to get a drug that is not on your plan's formulary (a formulary exception), or get a formulary drug at a lower cost-sharing level (a tiering exception). You may also request an exception if your plan requires you to try another drug before receiving the drug you were prescribed, or the plan limits the quantity or dosage of the drug you are prescribed (a formulary exception).

Excluded Drug

A drug that does not qualify for Medicare Part D coverage and, therefore, is not covered under your plan. Examples of the types of drugs excluded by Medicare are drugs when used for cosmetic purposes or hair growth. (You can find more information about excluded drugs in your Evidence of Coverage and formulary.)

Explanation of Benefits (EOB)

A monthly statement that you receive if you have used your prescription drug coverage during the previous month. It specifies, for example, the total amount that you have spent on prescription drugs and the total amount that your plan has paid out.

Extra Help

A Medicare program to help people with limited income and resources pay Medicare prescription drug program costs, such as premiums, deductibles, and coinsurance.

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F

Food and Drug Administration (FDA)

The federal agency responsible for overseeing drug safety and effectiveness, among other things.

Formulary

The list of prescription drugs covered by your plan. The drugs on this list are selected by the plan with the help of doctors and pharmacists. The formulary also provides a brief description of your coverage. Express Scripts Medicare provides you with a comprehensive formulary (a complete listing of covered drugs). Some plans provide an abridged formulary (a partial listing of covered drugs) in addition to a comprehensive formulary.

Formulary 60-day notice

A letter notifying you that a change is being made to the Medicare Part D formulary. The Centers for Medicare & Medicaid Services requires that we notify you at least 60 days in advance of any changes we make to your formulary, unless a drug is being removed by the manufacturer or the Food and Drug Administration because of issues with safety or effectiveness.

Formulary drug

Any drug that is covered and listed on a plan's Medicare Part D formulary.

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G

Generic alternative

A generic drug that may be given in place of a brand-name drug to achieve similar results when treating a specific condition. A generic drug must contain the same active ingredients as its brand-name counterpart. The inactive ingredients, however, may vary, such as in a generic alternative drug.

Generic drug

A prescription drug that has the same active ingredients as a brand-name drug. Food and Drug Administration (FDA)-approved generic drugs generally work the same as the brand-name drug in terms of quality, strength, purity, and dosage form and usually cost less.

Generic equivalent

An FDA-approved drug that contains the same active ingredients; is the same in quality, strength, and purity; has the same dosage form (such as tablet, capsule, liquid); and is taken the same way as its brand-name counterpart. For example, simvastatin is a generic equivalent for Zocor® because it treats the same condition; is the same in quality, strength, and purity, and has the same active ingredient as Zocor.

Grievance

A type of complaint you make about a plan or a plan's network pharmacy, including, for example, a complaint concerning the quality of care. This type of complaint does not include coverage or payment disputes. See Chapter 7, Section 7 of your Evidence of Coverage for details. (See also Appeal.)

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I

Initial coverage limit

The maximum limit of coverage in the Initial Coverage Stage. This limit, which the Centers for Medicare & Medicaid Services (CMS) specifies each year, includes the amount you, your plan, and others on your behalf pay for your drugs. In a standard Medicare Part D plan, once you reach this limit, you enter the Coverage Gap.

Initial Coverage Stage

In a standard Medicare Part D plan, the stage that begins after you have met your annual deductible (if your plan has one) and ends when your total drug expenses reach the initial coverage limit (including what you pay and what your plan pays).

Initial Enrollment Period (IEP)

To join a Medicare Part D plan, you must be eligible for Part A and/or enrolled in Part B. When you are first eligible to enroll in Medicare, the IEP is the period of time when you can sign up for Medicare Part D. For example, if you're eligible for Medicare Part D when you turn 65, your Initial Enrollment Period is the 7-month period that begins 3 months before the month you turn 65, includes the month you turn 65, and ends 3 months after the month you turn 65.

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L

Late enrollment penalty

If you don’t join a Medicare Part D plan when you are first eligible, you may have to pay an enrollment penalty that is added to your monthly premium if you decide to join later. You will pay this penalty for as long as you have Medicare Part D coverage. The late enrollment penalty is 1% of the national average premium for each month you were without Medicare Part D or other creditable coverage following your Initial Enrollment Period, or if you had a break in creditable prescription drug coverage for 63 or more consecutive days. Creditable prescription drug coverage (for example, from a current or former employer or union) means that it is expected to pay, on average, as much as Medicare’s standard prescription drug coverage.

Low-income subsidy (LIS) program

A Medicare program to help people with limited income and resources pay Medicare Part D prescription drug costs, such as premiums, deductibles, and coinsurance. See Extra Help.

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M

Maintenance drugs

Drugs that are taken on a regular basis for a chronic or long-term medical condition.

Medicaid (or Medical Assistance)

A joint federal and state program that helps with medical costs for some people with low incomes and limited resources. Medicaid programs vary from state to state, but most healthcare costs are covered if a person qualifies for both Medicare and Medicaid. (See also Dual eligible.)

Medicare

The federal health insurance program for people 65 years of age or older, some people under age 65 with disabilities, and people with end-stage renal disease (generally those with permanent kidney failure who need dialysis or a kidney transplant). People with Medicare can get their Medicare health coverage through Original Medicare, a Medicare Cost Plan, or a Medicare Advantage Plan.

Medicare Advantage (MA) Plan

Sometimes called Medicare Part C. A plan offered by a private company that contracts with Medicare to provide all your Medicare Part A and Medicare Part B benefits. A Medicare Advantage Plan can be an HMO, PPO, Private Fee-for-Service (PFFS) Plan, Special Needs Plan, or a Medicare Medical Savings Account (MSA) Plan. If you are enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan, and are not paid for under Original Medicare.

Medicare Advantage Plan with Prescription Drug (MA-PD) coverage

A Medicare Advantage Plan that also provides Medicare Part D prescription drug coverage.

Medicare Part A

The part of Medicare that covers much of the cost of hospital care, home health care, or a skilled nursing facility. (See also Original Medicare plan.)

Medicare Part B

The part of Medicare that covers most of the cost of your doctor visits, outpatient care, and other related services. Certain drugs are covered under Medicare Part B, and these cannot also be covered under Medicare Part D.

Medicare Part C

Another name for Medicare Advantage Plan. A plan offered by a private company that contracts with Medicare to provide Medicare Part A and Medicare Part B. A Medicare Advantage Plan can be an HMO, PPO, Private Fee-for-Service Plan, Special Needs Plan, or a Medicare Medical Savings Account (MSA) Plan.

Medicare Part D

Also known as Medicare prescription drug coverage, this is Medicare's insurance coverage to help people with Medicare pay for their prescription drugs, vaccines, biologicals, and some supplies not covered by Medicare Part B. Medicare Part D went into effect in 2006 as a result of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.

Medicare prescription drug coverage

Another name for Medicare Part D.

Medicare prescription drug plan (PDP)

A stand-alone Medicare Part D plan. Medicare PDPs are Medicare-approved plans that are provided by private companies.

Medication Therapy Management (MTM) programs

Free programs offered to selected Medicare Part D members who have several medical conditions or chronic illnesses, who are taking many prescription drugs, and who have high drug costs. Developed by a team of doctors and pharmacists, MTM programs are designed to help make sure that members are using the drugs that work best to treat their medical conditions and help the plan identify possible medication errors.

"Medigap" (Medicare supplemental insurance) policy

Medicare supplemental insurance policy sold by private insurance companies to fill "gaps" in Original Medicare plan. Medigap policies work only with Original Medicare.

Member

A person who has enrolled in a Medicare Part D plan, and whose enrollment has been confirmed by the Centers for Medicare & Medicaid Services (CMS).

Multi-source drug

A brand-name drug for which the patent protection has expired. As a result, generic drugs are available, and the drug is available from multiple sources.

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N

National Association of Area Agencies on Aging (AAA)

A national network of agencies that help older adults. Your local agency can help you get services and information, including counseling about your benefits, home-delivered meals, transportation, employment services, and referrals to senior centers, adult day care, and long-term care ombudsman programs. For more information, please visit http://www.n4a.org/about*.

Network pharmacy

A network pharmacy is a pharmacy where members of a plan can get their prescription drugs. They are called "network pharmacies" because they contract with a plan and participate in the plan's network. In most cases, your prescriptions are covered only if they are filled at one of the plan's network pharmacies. A list of Medicare Part D network pharmacies can be found in the Pharmacy Directory.

Non-creditable coverage

Prescription drug coverage that is not as good as the standard Medicare Part D prescription drug coverage. If you have non-creditable coverage, you may have to pay a late enrollment penalty if you choose to enroll in a Medicare Part D drug plan after your initial enrollment period.

Nonpreferred drug

A brand-name drug or generic drug that usually costs more than generic or preferred brand-name drugs on lower-cost tiers. (See also Drug tier.)

Notice of Creditable Coverage

A letter from an employer, union, or other health plan sponsor that tells you the coverage you have under that sponsor's prescription drug benefit is at least as good as the standard Medicare Part D prescription drug coverage. (See also Creditable prescription drug coverage.)

Notice of Non-creditable Coverage

A letter from an employer, union, or other health plan sponsor that tells you the coverage you have under that sponsor's prescription drug benefit is not as good as the standard Medicare Part D prescription drug coverage. (See also Non-creditable coverage.)

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O

Original Medicare ("Traditional Medicare" or "Fee-for-Service Medicare")

Original Medicare is offered by the government and is not a private health plan like Medicare Advantage Plans and prescription drug plans. You can see any doctor, hospital, or other healthcare provider who accepts Medicare. You must pay the deductible. Medicare pays its share of the Medicare-approved amount. Original Medicare has two parts: Medicare Part A (hospital insurance) and Medicare Part B (medical insurance) and is available everywhere in the United States.

Out-of-network pharmacy

A pharmacy that does not have a contract with a plan to coordinate or provide covered drugs to members of a plan. In most cases, drugs that you purchase at an out-of-network pharmacy are covered only in certain situations.

Out-of-pocket costs

A member's cost-sharing requirement to pay a portion of the cost for drugs received is also referred to as the member's true out-of-pocket cost requirement. (See also Cost-sharing.)

Over-the-counter (OTC) drug

A drug that is available without a prescription.

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P

Part D drugs

Drugs that can be covered under Medicare Part D. A plan may or may not offer all Medicare Part D drugs. (See the plan's formulary for a specific list of covered drugs.) Certain categories of drugs, such as drugs for weight loss or weight gain or drugs for cosmetic purposes or hair growth, were specifically excluded by Congress from being covered as Medicare Part D drugs. (See also Excluded drug.)

Preferred brand-name drug

A preferred brand-name drug typically requires a higher copayment than a generic drug but lower than a nonpreferred drug.

Preferred cost-sharing

Preferred cost-sharing means lower cost-sharing for certain covered Medicare Part D drugs at certain network pharmacies known as preferred pharmacies.

Preferred home delivery pharmacy

A home delivery pharmacy in a plan's Medicare Part D network where members may pay a lower copayment/coinsurance for covered drugs than they would at a standard home delivery pharmacy.

Preferred pharmacy

A pharmacy in a plan's Medicare Part D network with preferred cost-sharing. Members may pay a lower copayment/coinsurance for covered drugs than they would at a Medicare Part D network pharmacy with standard cost-sharing.

Preferred retail pharmacy

A retail pharmacy in a plan's Medicare Part D network with preferred cost-sharing. At this type of pharmacy, members may pay a lower copayment/coinsurance for covered drugs than they would at a retail network pharmacy with standard cost-sharing.

Premium

The monthly payment to Medicare, an insurance company, or a healthcare plan for health or prescription drug coverage.

Primary coverage

Coverage from the main provider of your prescription drug benefit. For example, this may be from a stand-alone Medicare prescription drug plan, a health plan, or a plan sponsor (such as an employer or union).

Prior authorization

Approval in advance to get certain drugs that may or may not be on a plan's formulary. Some drugs are covered only if your doctor or other network provider gets "prior authorization" from the plan. Covered drugs that need prior authorization are indicated in the formulary (list of covered drugs).

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Q

Quantity limits

A management tool that is designed to limit the use of selected drugs for quality, safety, or utilization reasons. Limits may be on the amount of the drug that we cover per prescription or for a defined period of time. Covered drugs that have quantity limits are marked in the formulary.

Quality Improvement Organization (QIO)

A group of practicing doctors and other healthcare experts paid by the federal government to check on and help improve the quality of care given to Medicare patients. See Chapter 2, Section 4 in the Evidence of Coverage (EOC) for further information about how to contact the QIO in your state.

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R

Retail network pharmacy

A retail pharmacy that participates in your plan's network. In most cases, you need to use a network pharmacy to fill your prescriptions and to pay the amounts specified by your plan. A list of network pharmacies can be found in the Pharmacy Directory. (Also called a Network pharmacy.)

Retail pharmacy

A chain or independently owned pharmacy. In most cases, the retail pharmacy must be in your plan's network in order for your drug to be covered. (See also Network pharmacy and Retail network pharmacy.)

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S

Secondary coverage

Coverage that pays for some expenses not covered by your primary coverage. Many employers and unions help their retirees with prescription drug expenses by offering secondary coverage when a retiree enrolls in a Medicare Part D prescription drug plan. In most cases, members must show two member ID cards when filling prescriptions (the card from the primary plan and the card from the plan providing secondary coverage).

Service area

A geographic area where a prescription drug plan accepts members if it limits membership based on where people live. The plan may disenroll you if you move out of the plan's service area.

Single-source drug

A brand-name drug that is manufactured by one company and protected by a patent. No other drug company is permitted to manufacture a generic equivalent until the patent expires.

Social Security Administration (SSA)

The federal agency that determines, among other things, whether you are entitled to and eligible for Medicare benefits.

Special Enrollment Period (SEP)

A set time other than the Annual Enrollment Period when a member can change his/her health or drug plans or return to Original Medicare. Examples of situations in which a member may be eligible for a Special Enrollment Period may include: moving outside the service area; getting "Extra Help" with prescription drug costs; losing creditable prescription drug coverage from an employer or other plan sponsor; losing coverage because a plan no longer offers Medicare prescription drug coverage; or moving into a nursing home.

Specialty drugs

Prescription medications that require special handling, administration, or monitoring. These drugs are used to treat complex, chronic, and often costly conditions. Plans may include these drugs in a separate "specialty" drug tier.

Standard Cost-Sharing

Standard cost-sharing is cost-sharing other than preferred cost-sharing offered at a network pharmacy.

Standard pharmacy

A pharmacy in a plan's Medicare Part D network where members may pay a higher copayment/coinsurance for covered drugs than they would at a preferred pharmacy.

State Health Insurance Assistance Program (SHIP)

SHIPs are state programs that get money from the federal government to give free local health insurance counseling to people with Medicare. SHIPs are independent and are not connected to any insurance company or health plan. Contact information by state is provided in the Evidence of Coverage.

State Pharmaceutical Assistance Program (SPAP)

A state-funded program (separate from Medicaid) that provides financial assistance for prescription drugs to low-income and medically needy senior citizens and individuals with disabilities. SPAPs are not available in all states. Contact information by state is provided in the Evidence of Coverage.

Step therapy

A utilization tool that requires a member to first try one or more specified drugs to treat a particular medical condition before the plan will cover another drug that the member's doctor may have prescribed. Covered drugs that require step therapy are indicated in the formulary.

Strength

The amount of an active ingredient contained in a drug.

Summary of Benefits

A document that gives an overview of the benefits available under the plan. The Centers for Medicare & Medicaid Services requires that a Summary of Benefits be included with all enrollment materials so that Medicare beneficiaries can use it to compare plans.

Supplemental Security Income (SSI)

A monthly benefit paid by the Social Security Administration to people with limited income and resources who are disabled, blind, or aged 65 and older. SSI benefits are not the same as Social Security benefits.

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T

Therapeutic alternative

A drug that may be given in place of another drug to achieve the same or similar results for most people. Therapeutic alternatives may contain different active ingredients, but they generally provide a similar effect when treating a specific condition.

Therapeutic category

A group of drugs that are similar in their chemical make-up, the way they work, the conditions they treat, or their specific effects.

Therapeutic class

A group of drugs that are used to treat the same condition or symptom.

Tier

The level of coverage for each drug, for example, "generic drug tier" or "specialty tier drug." Your copayment or coinsurance will depend, in part, on which tier the drug is in. You can find more information about tiers in your Evidence of Coverage and in your formulary. (See Drug tier.)

Total drug costs

The total amount paid for your prescription drugs. This amount includes what you pay and also what your plan pays for your drugs. In a standard Medicare Part D plan, when the total amount reaches a specified limit set by Medicare, the member moves from the Initial Coverage Stage to the Coverage Gap Stage.

Transition supply

A temporary supply of medication that the plan is required to cover for a limited time for a new member or existing members under certain circumstances. (See the Evidence of Coverage for details.)

True out-of-pocket costs (TrOOP)

The amount that you (and others on your behalf) have spent out of pocket during the plan year for Medicare Part D drugs. Once TrOOP expenses reach a certain amount that Medicare has set, you qualify for what most plans refer to as Catastrophic Coverage.

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