Medicare Part D covers prescription drugs, but not all of them, and not all the cost

Medicare Part D is the prescription drug coverage piece of Medicare. It covers most common medications — both brand-name and generic — but it has a specific list of drugs it will pay for, called a formulary. Your Part D plan may not cover every medication your doctor prescribes, and even when it does, you typically pay a share of the cost through copays or coinsurance.

The drugs Part D covers fall into categories called tiers. Lower tiers (usually generic drugs) cost you less out of pocket. Higher tiers (usually brand-name drugs) cost you more. Your specific plan decides which drugs go in which tier, so two people with different Part D plans may pay different amounts for the same medication.

Key Takeaways

  • Medicare Part D covers most prescription medications, but each plan has its own formulary — a list of covered drugs — so you need to check your specific plan's list before assuming your medication is covered.
  • Drugs are organized into tiers, with generic medications usually costing less out of pocket than brand-name versions of the same drug.
  • You pay a copay or coinsurance for each prescription, and these costs vary by tier and by plan.
  • If your doctor prescribes a drug your plan does not cover, you can ask your plan for an exception, ask your doctor for an alternative, or pay the full cost yourself.
  • Part D does not cover over-the-counter medications, vitamins, or drugs used to treat weight loss.

What Part D covers: the formulary and tiers

Each Part D plan publishes a formulary — a list of medications the plan will help pay for. This list changes every year, usually in October. The formulary groups drugs into tiers, typically four or five levels. Tier 1 usually holds generic drugs and costs you the least. Tier 2 holds preferred brand-name drugs. Tier 3 holds non-preferred brand-name drugs and costs more. Tier 4 or 5 holds specialty drugs — expensive medications for conditions like cancer or rheumatoid arthritis — and costs you the most.

Your out-of-pocket cost for each prescription depends on which tier the drug is in and which plan you chose. A generic drug in Tier 1 might cost you $5 to $10 per prescription. A brand-name drug in Tier 3 might cost you $50 to $100 or more. Specialty drugs in the highest tier can cost hundreds of dollars per prescription, though your plan may cap your total out-of-pocket spending at a certain amount per year.

To find out whether a specific medication is covered and what tier it is in, you can look up your plan's formulary on Medicare.gov, call your plan's customer service number, or ask your pharmacist. Your plan's website usually has a search tool where you type in the drug name and see the tier and your copay amount.

What Part D does not cover

Medicare Part D does not cover over-the-counter medications, even if they treat a condition your doctor diagnosed. Aspirin, ibuprofen, antacids, cold medicine, and allergy pills are not covered, even if you buy them at a pharmacy. You pay the full price yourself.

Part D also does not cover vitamins, minerals, or nutritional supplements, even if a doctor recommends them. Drugs used to treat weight loss or weight management are not covered. Certain other medications — such as some fertility drugs or drugs used only in hospitals or clinics — fall outside Part D's scope and are covered under a different part of Medicare instead.

If your doctor prescribes a medication that Part D does not cover, you have three main options: ask your doctor whether a covered alternative exists, request an exception from your plan (explained below), or pay the full cost of the uncovered drug yourself.

When your medication is not on your plan's formulary

Even though Part D covers most prescription drugs, your specific plan might not cover the exact medication your doctor prescribed. This happens when a drug is on Medicare's list of covered medications but your plan chose not to include it on its formulary, or when your plan put it in a very high tier.

If this happens, you can ask your plan for a formulary exception. You or your doctor submit a request explaining why you need that specific drug — for example, because you have tried other drugs on the formulary and they did not work, or because you have taken this drug successfully for years. Your plan has 72 hours to respond. If the plan approves the exception, it may move the drug to a lower tier or add it to the formulary, reducing your cost.

Your doctor can also prescribe a different medication that is on your plan's formulary. Generic versions of drugs are almost always covered and cost less. If your doctor prescribed a brand-name drug, asking whether a generic version exists is often the fastest way to lower your cost.

How much you pay: copays, coinsurance, and the coverage gap

Your Part D costs work in stages. First, you pay a monthly premium to your plan. Then, when you fill a prescription, you pay a copay (a flat amount like $5 or $15) or coinsurance (a percentage of the drug's cost, like 20%). These payments count toward your annual out-of-pocket maximum.

Once your total out-of-pocket spending reaches a certain amount — $7,050 in 2024, though this changes yearly — you enter what used to be called the "donut hole" or coverage gap. In the coverage gap, you pay a higher percentage of the drug's cost. However, recent law changes have reduced what you pay in the gap. As of 2024, you pay no more than 25% of the cost of most drugs in the coverage gap.

Once your out-of-pocket spending reaches your plan's catastrophic coverage threshold (around $10,500 in 2024), your plan pays most of the cost and you pay only a small copay or coinsurance for the rest of the year.

How to check what your plan covers before you need it

The best time to check your Part D coverage is before your doctor prescribes a medication. If you know you take a certain drug regularly, look it up in your plan's formulary now. You can search on Medicare.gov by logging into your account, or you can call your plan's customer service number — the number is on your Part D card.

When you search, write down the tier, your copay amount, and any restrictions. Some drugs require prior authorization, meaning your doctor must get approval from the plan before the pharmacy will fill the prescription. Others are limited to a certain number of pills per month. Knowing these details ahead of time prevents surprises at the pharmacy.

If you change plans during the annual enrollment period (October 15 to December 7 each year), you can compare formularies across plans to find one that covers your medications at the lowest cost to you. Medicare.gov has a plan comparison tool that shows you which drugs each plan covers and what your costs would be.

What to do if your medication costs too much

If your Part D copay or coinsurance is higher than you can afford, talk to your doctor or pharmacist about lower-cost alternatives. Generic drugs are almost always cheaper than brand-name versions. Your doctor might also know of a different medication in the same drug class that your plan covers at a lower tier.

Some drug manufacturers offer patient information programs that reduce or eliminate the cost of their medications for people who meet income requirements. Your pharmacist or doctor's office can help you find out whether the drug you take has an information program. You can also search for programs on the Partnership for Prescription information website (pparx.org).

If you are struggling to afford your medications, contact your local Area Agency on Aging or a Medicare counselor through the State Health Insurance information Program (SHIP). These services are free and can help you understand your options.

Frequently Asked Questions

Does Medicare Part D cover insulin?

Yes. Part D covers insulin and other diabetes medications. As of 2024, if you are on Medicare, your copay for a month's supply of insulin is capped at $35, regardless of which insulin you use or which tier it is in. This cap applies to all Part D plans.

Will Part D cover a drug my doctor just prescribed if it is brand new?

Newly approved drugs are usually added to Part D formularies within a few months, but not always when ready. Call your plan or check the formulary online to see whether the drug is covered. If it is not yet on the formulary, ask your doctor whether an older, covered medication might work instead, or request a formulary exception.

What if my plan stops covering a drug I have been taking for years?

Plans can remove drugs from their formularies or move them to higher tiers each year. If this happens to you, contact your plan and ask for a formulary exception based on your history with the drug. You can also switch to a different Part D plan during the annual enrollment period (October 15 to December 7) that still covers your medication.

Can I use Part D to fill prescriptions at any pharmacy?

Part D plans have networks of pharmacies where your copay applies. If you use an out-of-network pharmacy, you may pay more or have to pay the full cost and request reimbursement. Check your plan's pharmacy network before filling a prescription, especially if you use a specialty pharmacy.

Does Part D cover medications prescribed by doctors outside the United States?

Part D generally does not cover prescriptions filled outside the United States. If you travel or live part-time outside the country, talk to your plan about your options. Some plans offer limited coverage for prescriptions filled abroad, but this varies widely.