An Explanation of Benefits form is a monthly statement sent by Medicare to beneficiaries who fill prescriptions using Medicare’s Part D prescription drug plan. The EOB form is not a bill. Rather, it provides information that helps you track your prescription drug usage. It also ensure that both Medicare and your pharmacy are providing you with the proper benefits at the proper cost. The Explanation of Benefits form is divided into six subsections, the first of which is the focus here.
Section 1 of the EOB shows your prescription purchases for the previous month. There may be one or two charts in this section, depending on whether or not you filled prescriptions using drugs covered by your plan and additional drugs provided via your plan’s supplemental coverage. Each chart is divided into four or more vertical columns.
- Column one indicates the drug and the purchase date.
- Column two lists the amount that your Part D plan paid for this particular drug.
- Column three lists what you paid for this particular drug.
- Column four lists what other organizations, such as Medicare Extra help programs, may have paid for this particular drug.
Note that the amount that you paid in column two is the total after any other payments made by organizations on your behalf from column four.
If the column two total is $0.00, this means that you are in the deductible stage of your Medicare Part D coverage plan. This means that you are responsible for all of the drug costs. If you are enrolled in a Medicare Extra Help program, you will not have a deductible stage even if your plan ordinarily features one.
If Section 1 of your Explanation of Benefits statement features more than one chart, this means that some of your prescription drugs are provided under your Medicare Part D plan’s supplemental drug coverage. Medicare displays these drugs on a separate chart in order to reduce confusion and emphasize that any payments made for these prescriptions do not count toward your out of pocket costs or your total drug costs. The drugs do not count toward your totals because they are typically not covered by Medicare’s original plan, hence the supplementary status. The supplemental chart is organized exactly like the main chart, with four vertical columns displaying the drug, the plan payments, your payments, and other organization payments.
Section 1 of your Explanation of Benefits form may also note formulary changes for your drugs as necessary. For example, column one of the first chart will tell you if the drug in question is scheduled for removal from the plan’s drug list at a future date. If that is the case, you will need to consult with your doctor to determine a suitable replacement. Medicare may also move drugs into different cost tiers on a formulary plan. If so, this will also be noted in Section 1 of your Explanation of Benefits form.