NEW YORK (MONEY Magazine) - Q. How does the new drug benefit work?

The new benefit, formally known as Medicare Part D, will offer coverage for the cost of medicine through stand-alone prescription drug plans (PDPs) sold by insurers and subsidized and regulated by Medicare.

You can also get prescription drug coverage through one of the many managed-care alternatives to traditional Medicare, mostly known as Medicare Advantage plans.

The PDP providers will range from nationally known insurers like Aetna and Humana to regional companies, and the plans will differ considerably in details, including the premiums they charge, the drugs they cover and the pharmacies they allow you to use. Every area of the country will have between 11 and 23 choices of insurers, and some of those providers may offer more than one type of policy.

Fortunately, you've got time to decide. While coverage can begin as early as Jan. 1, you can sign up for a drug plan anytime between Nov. 15, 2005 and May 15, 2006 without penalty.

How much will I have to pay? >>

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