Medicare Part D is not easy to understand at first glance, but with a little math, you will find that it is an excellent opportunity for seniors. If you just take a quick look at the information, it looks like the savings for Medicare Part D is about 75%. But, looks can be deceiving when in fact that is only a portion of the overall savings offered by their formula. Here is a simple way to calculate how to take advantage of the new prescription drug plan if expenses are over $2250 per year.

Medicare Part D - What You Should Consider

1. Prescription Drug Expenses: Start with your annual prescription drug expenses. Figure out how much would be spent on prescriptions without insurance at all. You will need to use the full amount to get the most accurate results. Calculate which month of the year your "retail" costs for prescription drugs will be $2250 (This amount maximizes your benefits). Anything after $2250, then Medicare Part D stops and full retail costs apply for the rest of your prescriptions.

Plan Costs: Calculate how much will be spent on your annual deductible and monthly premiums. (In insurance plan you have chosen) then add $500 to this amount for the 25% not covered by Medicare part d. Then add the full retail amount that will be spent for the rest of the year to find the "real expenses". Subtract savings ($1500) from expenses to calculate the actual percentage of savings. Please note: 75% savings is impossible to reach.

If Your Prescription Expenses Are More Than $2250

Benefits: Maximize Your Benefit: Using Medicare Part D up to $2250 in prescription drugs maximizes it's benefits. Use up every bit of the benefit up to $2250 then use another discount source for prescription savings after that point. Once you hit $2250 the savings are minimal to none through Medicare Part D.

Additional Discounts: Canadian medications are typically 30% - 60% less than retail prices in the U.S. Using Canadian Pharmacies to help balance expenses acts as an additional medical insurance policy for prescription drugs. Your goal should be to buy $2250 worth of "approved" prescription drugs through Medicare Part D and then buy additional medications (non-approved and over and above $2250) through discount sources like Canadian Pharmacies.

Here Is What Your Costs Might Look Like:

Approximately 50% - 60% savings will come through Medicare Part D, and about 30% - 40% savings from discount sources such as Canadian Pharmacies. Please remember that you need to prioritize your spending on prescription drugs so you only purchase "approved" prescription drugs through Medicare Part D, then purchase non-approved and additional drugs over the $2250 from discount sources.