Intro to Medicare

Medicare Prescription Drug Coverage

View Prescription Drug Coverage Benefits by Year

Medicare Part D plans help cover the costs of your prescription drugs. Part D plans are available through private companies, and you must actively enroll. Even if you currently don't spend a lot of money on medications, choosing to enroll in a Medicare Part D plan now can help protect you from high drug costs in the future. And, if you don't enroll when you're first eligible, you may pay a penalty fee to enroll later.

How can I enroll in Part D?

  • You can enroll in a Medicare Advantage plan that includes Part D coverage.
  • Or, you can enroll in a standalone Medicare prescription drug plan (PDP) if you want drug coverage along with Original Medicare.

If you aren't already enrolled in a Part D plan and suddenly need drug coverage, your plan coverage won't be effective until your next enrollment period, which means you could be without coverage for a period of time.

What do Part D plans cover?

  • Commonly used brand name and generic drugs
  • Drugs that are covered can vary from plan to plan
  • Some plans offer more drugs than others
  • Typically, Part D plans don't cover over-the-counter medications.

What do Part D plans cost?

  • Depends on the way you receive the benefit
  • May include an annual deductible and co-insurance or copayments
  • Most Prescription Drug Plans (PDPs) also have a monthly premium you pay for the coverage, in addition to your Part B premium
  • Medicare Advantage plans with prescription drug coverage also require a premium that includes the cost of Medicare Part D

Is financial help available?

You may be able to get “Extra Help” to pay for your prescription drug premiums and costs. To see if you qualify for getting “Extra Help,” call:

1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/7 days a week;

The Social Security Office at 1-800-772-1213, between 7 am to 7 pm, Monday through Friday. TTY users should call 1-800-325-0778 (applications); or 

Your State Medicaid Office (applications) (See Section 6 of this chapter for contact information).

What is the “donut hole”?

Most Medicare drug plans have a coverage gap, also called the “donut hole.” To address this, after you and your plan spend a certain amount on covered medications, you'll only be required to pay:

  • Up to 25% of the plan's costs for brand-name medications, and
  • Up to 25% of the plan's costs for generic drugs, until your yearly out-of-pocket medication costs reach $4,020, plus

Once you reach your plan's out-of-pocket limit, you automatically get "catastrophic coverage", which ensures that once you have spent up to your plan's out-of-pocket limit for covered drugs, you only pay a small co-insurance amount or copayment for covered drugs the rest of the year.

Medicare Part D plans help cover your costs for prescription drugs. Part D plans are available through private companies, and you must actively enroll. Even if you currently don't spend a lot of money on medications, choosing to enroll in a Medicare Part D plan now can help protect you from high drug costs in the future. And, if you don't enroll when you are first eligible, you may pay a penalty fee if you enroll later.

When can I enroll?

  • You can enroll in a Medicare Advantage plan that includes Part D coverage.
  • Or, you can enroll in a standalone Medicare prescription drug plan (PDP), if you want drug coverage along with Original Medicare.

If you aren't already enrolled in a Part D plan and suddenly need drug coverage, you can't start coverage until your next enrollment period (usually next October)-which could mean you have no coverage for a lengthy period of time!

What’s covered by Part D plans?

  • Commonly used brand name and generic drugs
  • Drugs that are covered can vary from plan to plan
  • Some plans offer more drugs than others

Typically, Part D plans don't cover over-the-counter medications.

What do Part D plans cost?

  • Depends on the way you receive the benefit
  • May include an annual deductible and co-insurance or copayments
  • Most PDPs also have a monthly premium you pay for the coverage, in addition to your Part B premium
  • Medicare Advantage plans also require a premium that may include the cost of Medicare Part D

Is financial help available?

If you are getting Social Security benefits, the Part B premium is taken out of your monthly Social Security payment. If you don't get full Social Security benefits yet, Medicare will send you a bill for your Part B premium every three months. If you don't get your bill by the 10th of the month, call Social Security anytime, 24 hours a day at 1-800-772-1213 (TTY: 1-800-325-0778).

What is the “donut hole”?

Most Medicare drug plans have a coverage gap, also called the “donut hole.” After you and the plan spend a certain amount on covered drugs, you pay:

  • No more than 25% of the plan's costs for brand drugs, and...
  • 37% of the plan's costs for generic drugs, until...
  • Your yearly out-of-pocket drug costs reach $3,820
  • Medicare Advantage plans also require a premium that may include the cost of Medicare Part D

These savings in the coverage gap increase each year through 2020.

Once you reach your plan's out-of-pocket limit, you automatically get "catastrophic coverage", which ensures that once you have spent up to your plan's out-of-pocket limit for covered drugs, you only pay a small co-insurance amount or copayment for covered drugs the rest of the year.

For more information, download the free publication "Closing the Coverage Gap" from medicare.gov.