Medicare Prescription Drug Plans (Part D)

Affordable Access to Medications You Need

Prescription drugs are one of the biggest ongoing healthcare costs for retirees. That’s where Medicare Part D comes in. Part D plans are private insurance plans approved by Medicare that help pay for your medications.

Think of Part D as your drug cost safety net.

You can:

  • Enroll in a standalone Part D plan if you have Original Medicare (with or without Medigap).

  • Or get Part D built into most Medicare Advantage plans.

What Part D Covers

  • A wide range of brand name and generic medications.

  • Drugs listed on each plan’s formulary (the official covered drug list).

  • Tiered cost structure: generics, preferred brands, non-preferred brands, and specialty drugs all have different copays.

What to Keep in Mind

  • Plans vary by carrier and region: The same drug may cost different amounts depending on the plan and pharmacy you use.

  • Premiums vary: Higher-income individuals may pay an extra surcharge (IRMAA).

  • Late enrollment penalty: If you go without “credible coverage” when first eligible, you could pay a permanent penalty later.

  • Pharmacy choice matters: Some plans have preferred pharmacies where your costs are lower.

Cost Example

  • Generic (Tier 1): $0-$5 copay

  • Preferred brand (Tier 2): $20-$35 copay

  • Non-preferred brand (Tier 3): $45-90 copay, sometimes a percentage

  • Speciality (Tier 4/5): percentage of the drug cost

Bottom line: Choosing the right plan can save you hundreds. The wrong plan can cost you thousands.

Who Part D Works Best For

  • You take regular prescriptions and want predictable costs

  • You want protection from expensive brand-name or specialty drugs.

  • You want flexibility to pick a plan that matches your exact medications.

Not a fit if

  • You’re enrolled in a Medicare Advantage plan that already includes drug coverage.

  • You don’t take any prescriptions now and are willing to risk late penalties later (not recommended).

Next Steps.

Choosing the right Part D plan depends entirely on which medications you take and where you live. That’s why a one size fits all answer doesn’t work.

Schedule your free Medicare Audit™️ today. We’ll run a plan comparison to show you the most cost-effective option for your prescriptions.

COMPARE MY DRUG COVERAGE

Prescription Drug Plan (Part D) FAQs 

  • No, but if you don’t have creditable prescription coverage when you’re first eligible, you may face a late enrollment penalty that never goes away.

  • Generic drugs, preferred brand name drugs, non-preferred brand name drugs, and vaccines recommended by the CDC.

  • Yes. You can switch plans during the Annual Enrollment Period (Oct 15–Dec 7), or during certain Special Enrollment Periods triggered by life events.

  • No. Each plan has its own formulary (drug list). It’s important to check whether your prescriptions are covered before enrolling.

  • Once you hit the maximum out-of-pocket for that year (changes yearly), you are paid up for the remainder of the year.

  • As of January 1, 2025, the donut hole is no longer applicable to Medicare beneficiaries.