Medicare Prescription Drug Coverage
Medicare prescription drug coverage (Part D) helps you pay for both brand-name and generic drugs. This coverage is available through standalone Part D plans or included in most Medicare Advantage plans.
Understanding Drug Coverage Stages
1. Deductible Stage
You pay the full cost of your drugs until you meet your plan's deductible (if it has one). In 2025, the maximum deductible is $590. Some plans have no deductible or apply it only to certain drug tiers.
2. Initial Coverage Stage
After meeting your deductible, you pay a copayment or coinsurance for your drugs, and your plan pays the rest. This continues until your total drug costs reach $5,030 in 2025.
3. Coverage Gap (Donut Hole)
Once you reach the initial coverage limit, you enter the coverage gap. In 2025, you'll pay no more than 25% of the cost for both brand-name and generic drugs until you reach the catastrophic coverage threshold.
4. Catastrophic Coverage
After your out-of-pocket costs reach $8,000 in 2025, you enter catastrophic coverage. You'll pay no more than 5% of drug costs or small copayments for the rest of the year.
Drug Tiers Explained
Most Part D plans organize drugs into tiers, with different costs for each tier:
Preferred Generic Drugs
Lowest copayments
Generic Drugs
Low copayments
Preferred Brand Drugs
Medium copayments
Non-Preferred Drugs
Higher copayments
Specialty Drugs
Highest copayments (often coinsurance)
Ways to Save on Prescriptions
📊 Use Preferred Pharmacies
Many plans offer lower costs when you use pharmacies in their preferred network.
📦 Try Mail Order
Get 90-day supplies of maintenance medications delivered to your home, often at lower costs.
💊 Consider Generics
Generic drugs have the same active ingredients as brand-name drugs but cost significantly less.
💵 Extra Help Program
Low-income beneficiaries may qualify for Extra Help to pay premiums, deductibles, and copayments.
Check Your Plan's Formulary
Each Part D plan has a formulary (list of covered drugs). Before enrolling, make sure your medications are covered and check what tier they're in to understand your costs. Formularies can change, so review them annually during Open Enrollment.
Find the Right Drug Coverage for You
Don't overpay for your prescriptions. Our licensed insurance agents can help you compare Part D plans and find coverage that includes your medications at the best price.
Compare Drug Plans