Medicare covers prescription drugs, but only through Part D or Part B — and the coverage rules are different for each one
Medicare Part D is the prescription drug plan. It covers most medications you take at home, from antibiotics to blood pressure pills to inhalers. You choose a Part D plan during enrollment, and the plan pays a share of your drug costs. Medicare Part B covers some drugs too — mainly ones you receive in a doctor's office or hospital, like chemotherapy or certain biologics. If you have Original Medicare (Parts A and B), you need to add Part D separately. If you have a Medicare Advantage plan, drug coverage is usually built in, though the drugs covered and your costs may differ from Original Medicare plans.
The catch is that no single plan covers every drug, and your out-of-pocket costs depend on which plan you choose and which drug you need. A medication your neighbor pays $10 for might cost you $50 under a different plan — or might not be covered at all. This section explains what is covered where, how much you typically pay, and how to find out what your specific drugs will cost before you enroll.
Key Takeaways
- Part D covers most prescription drugs taken at home, but each plan has its own list of covered drugs called a formulary, and not all drugs are on every formulary.
- You pay a monthly premium for Part D, a yearly deductible, and then a percentage or fixed amount per prescription depending on which coverage stage you are in.
- Part B covers drugs given to you in a medical setting, like infusions or injections at a hospital or doctor's office, and you pay 20 percent of the cost after your deductible.
- The drugs covered and the costs change every year, so you should review your plan each fall during the annual enrollment period, even if you have been happy with it.
- You can check whether a specific drug is covered and what you will pay by entering it into the Medicare Plan Finder tool on Medicare.gov before you enroll.
How Part D prescription drug coverage works
Part D is run by private insurance companies that contract with Medicare. When you enroll in a Part D plan, you choose which company and which plan level you want. Each plan has a formulary — a list of drugs the plan covers. Most common drugs are on most formularies, but some are not, and the ones that are may be in different tiers that cost you different amounts.
You pay three things under Part D: a monthly premium (the cost of the plan itself), a yearly deductible (usually $505 to $550, though this changes annually), and then a copay or coinsurance for each prescription. After you meet your deductible, you typically pay a fixed amount per drug — $5 for a generic, $25 for a preferred brand name, $50 for a non-preferred brand name, for example. Once your total out-of-pocket spending reaches a certain limit (around $5,850 in 2024, but this changes yearly), catastrophic coverage kicks in and you pay only a small amount per prescription for the rest of the year.
If a drug you need is not on your plan's formulary, you can ask your doctor to request an exception. The plan may cover it anyway, or it may ask you to try a similar drug first. This process takes time, so if you are starting a new medication, check the formulary before your first prescription.
How Part B covers drugs in medical settings
Part B covers drugs that are given to you by a healthcare provider — not drugs you pick up at a pharmacy and take at home. This includes chemotherapy, certain biologics (like some arthritis or cancer drugs), blood clotting factors, and drugs given during dialysis. You do not need a separate Part D plan to get these covered; Part B handles them automatically.
You pay 20 percent of the cost of a Part B drug after you meet your yearly Part B deductible (currently $240, though this changes annually). The provider or facility bills Medicare, Medicare pays 80 percent, and you are responsible for the remaining 20 percent. If the drug is very expensive, your 20 percent share can be substantial, so some people carry supplemental insurance (Medigap) to cover that cost.
What happens if your drug is not covered
If your Part D plan does not cover a drug, you have several options. First, ask your doctor whether there is a similar drug on your plan's formulary that would work for your condition. Many conditions have multiple treatment options, and switching to a covered drug may be possible.
Second, you can request a formulary exception. Your doctor submits a form to the plan explaining why you need that specific drug. The plan has 72 hours to respond (or 24 hours if it is urgent). They may approve it, deny it, or ask you to try a covered alternative first. If they deny it, you can appeal.
Third, you can pay out of pocket for the uncovered drug and submit a receipt to your plan to see if they will reimburse you. This rarely works, but it is worth asking. Fourth, you can switch to a different Part D plan during the annual enrollment period if another plan covers the drug you need.
Using the Medicare Plan Finder to check drug costs before you enroll
Before you choose a Part D plan, you should check what your specific drugs will cost under each plan. The Medicare Plan Finder tool on Medicare.gov lets you enter your medications and see the cost under each available plan in your area. You can also see the monthly premium, yearly deductible, and whether you will hit the coverage gap (a stage where you pay more out of pocket before catastrophic coverage begins).
To use it, go to Medicare.gov, click "Find Care Providers, Suppliers, and Other Care Facilities," then select "Prescription Drug Plans." Enter your zip code, your medications (including strength and quantity), and your pharmacy. The tool shows you every Part D plan available to you, ranked by total estimated cost for the year. This is the single most useful thing you can do before enrolling, because the difference between plans can be hundreds of dollars.
Keep in mind that the Plan Finder shows costs based on the current formulary and pricing, which can change. Once you enroll, confirm with your pharmacy that the price you see in the tool matches what they charge.
When to review or change your Part D plan
Medicare holds an annual enrollment period every year from October 15 to December 7. During this time, you can switch Part D plans, drop Part D, or enroll in Part D for the first time. After December 7, you are locked into your plan for the rest of the year (with rare exceptions for life events like moving or losing other coverage).
You should review your plan every fall, even if you have been happy with it. Formularies change — drugs get added or removed, tiers shift, and premiums go up. A drug that was cheap under your plan last year might be expensive this year, or a new generic version might be available that is cheaper. Spending 30 minutes in October to check the Plan Finder can save you hundreds of dollars.
If you miss the enrollment period and want to change plans, you generally cannot until the next October. The only exceptions are if you move to a new state, lose your current coverage, or have a may have access to life event. If that happens, contact Medicare right away to see if you can make a change.
How much you typically pay for prescriptions
Your actual costs depend on your plan, the drug, and where you are in the coverage year. Here is what a typical year looks like:
| Coverage Stage | What Happens | What You Pay |
|---|---|---|
| Deductible stage | You have not yet met your yearly deductible | Full price of the drug (some plans waive the deductible for generic drugs) |
| Initial coverage | You have met the deductible; you are in the main coverage period | Copay or coinsurance (usually $5–$50 per prescription depending on the drug tier) |
| Coverage gap | Your total out-of-pocket spending has reached a threshold (around $5,850 in 2024) | You pay 25 percent of the drug cost; this stage ends when your out-of-pocket spending reaches the catastrophic limit |
| Catastrophic coverage | Your out-of-pocket spending has reached the catastrophic limit (around $7,050 in 2024) | You pay a small copay (usually $3.75–$9.20 per prescription) for the rest of the year |
These dollar amounts change every year. Check your plan's summary of benefits or call the plan directly to confirm the exact amounts for the current year.
Frequently Asked Questions
Do I have to enroll in Part D when I first get Medicare?
You do not have to, but if you wait and enroll later, you may pay a permanent penalty on your monthly premium. The penalty is about 1 percent of the national average Part D premium for each month you were not enrolled. If you go without Part D for two years, your penalty is roughly double. The exception is if you have other drug coverage (like from an employer or union) that is at least as good as Part D — in that case, you can delay without penalty.
What if I cannot afford my Part D premiums or copays?
You may be able to get help through the Low-Income Subsidy (LIS) program, also called "Extra Help." This program pays some or all of your Part D premium and reduces your copays if your income is below a certain level. You can explore through Social Security or your state Medicaid office. If you think you might may have access to, explore — many people who are may be able to access do not know about it.
Can I use my Part D plan at any pharmacy?
Most Part D plans have a network of pharmacies where you pay the copay amount. If you use an out-of-network pharmacy, you may pay more or have to pay the full price and submit a receipt for reimbursement. Check your plan's pharmacy network before you choose a plan, especially if you have a pharmacy you prefer.
What if I move to a different state?
Your current Part D plan may not be available in your new state. You can change plans without penalty if you move. Contact your current plan to find out when your coverage ends, then enroll in a new plan in your new state. Do this before your current coverage ends so there is no gap.
Are brand-name drugs always more expensive than generics under Part D?
Usually, yes — generics are almost always cheaper. But the difference depends on your plan. Some plans charge $5 for a generic and $50 for the brand-name version of the same drug. However, if your doctor says you need the brand-name drug for medical reasons, you can request an exception and the plan may cover it at the generic copay level.