Talk To Us

How does Medicare drug coverage work?

Medicare drug coverage (Part D) helps pay for prescription drugs you need. Even if you don’t take prescription drugs now, you should consider getting Medicare drug coverage. Medicare drug coverage is optional and is offered to everyone with Medicare. If you decide not to get it when you’re first eligible, and you don’t have other creditable prescription drug coverage (like drug coverage from an employer or union) or get Extra Help, you’ll likely pay a late enrollment penalty if you join a plan later. Generally, you’ll pay this penalty for as long as you have Medicare drug coverage (see pages 83–84). To get Medicare drug coverage, you must join a Medicare-approved plan that offers drug coverage. Each plan can vary in cost and specific drugs covered.
There are 2 ways to get Medicare drug coverage (Part D):
1. Medicare drug plans. These plans add Medicare drug coverage (Part D) to Original Medicare, some Medicare Cost Plans, some Private Fee-for-Service plans, and Medical Savings Account plans. You must have Part A and/or Part B to join a separate Medicare drug plan.
2. Medicare Advantage Plans or other Medicare health plans with drug coverage. You get your Part A, Part B, and Medicare drug coverage (Part D) through these plans. Remember, you must have Part A and Part B to join a Medicare Advantage Plan, and not all of these plans offer drug coverage.
In either case, you must live in the service area of the plan you want to join and be lawfully present in the U.S.

How much do I pay?

Your drug costs will vary based on the plan you choose. Remember, plan coverage and costs can change each year. You may have to pay a premium, deductible, copayments, or coinsurance throughout the year.

Your actual drug coverage costs will vary depending on:

  1. Your prescriptions and whether they’re on your plan’s list of covered drugs.
  2. What “tier” the drug is in.
  3. Which drug benefit phase you’re in (like whether you’ve met your deductible, or if you’re in the catastrophic coverage phase).
  4. Which pharmacy you use (whether it offers preferred or standard cost sharing, is out of network, or is mail order). Your out-of-pocket drug costs may be less at a preferred pharmacy because it has agreed with your plan to charge less.
  5. Whether you get Extra Help paying your Medicare drug costs.

Questions? Get free personalized advice