Medicare Part D costs vary by plan and pharmacy, but you will pay a monthly premium, yearly deductible, and copayments or coinsurance at the pharmacy counter

There is no single price for Medicare Part D. Each insurance company sets its own monthly premium, deductible, and copayment amounts. A plan that costs $15 a month in one state might cost $35 in another. The same plan might charge $5 for one drug and $50 for another. What you pay depends on which plan you choose, which pharmacy you use, and which drugs you take.

Most people pay three types of costs: a monthly premium (the price to have the plan), a yearly deductible (the amount you pay out of pocket before the plan starts paying), and per-dose costs at the pharmacy (copayments or coinsurance). Some plans have no deductible. Some have a $5 monthly premium. Others cost $100 or more per month. The only way to know what a specific plan will cost you is to look at the actual plan documents or use the Medicare plan finder tool on Medicare.gov.

Key Takeaways

  • Medicare Part D premiums range widely by plan and location, and you can compare exact prices for plans in your area on Medicare.gov.
  • Most plans have a yearly deductible you must pay before the plan covers any drugs, though some plans waive this for certain medications.
  • You pay a copayment (a flat dollar amount) or coinsurance (a percentage of the drug cost) each time you fill a prescription, and these amounts differ by drug tier.
  • If your income is below certain thresholds, you may pay reduced or no premiums and deductibles through the Low-Income Subsidy program.
  • Costs change every year, and you can switch plans during the annual enrollment period from October 15 to December 7.

The three main costs: premium, deductible, and per-dose payments

The monthly premium is what you pay to have the plan, whether you fill any prescriptions or not. In 2024, premiums ranged from about $7 to over $100 per month depending on the plan and your state. You pay this amount every month you are enrolled. If you do not pay it, your coverage stops.

The yearly deductible is the amount you must pay out of your own pocket before your plan starts to help pay for drugs. Many plans have a deductible of $0 to $550, though the exact amount varies by plan. Once you have paid your deductible, the plan begins to share the cost with you. Some plans waive the deductible for certain drugs — for example, some plans do not charge a deductible for generic drugs or drugs for chronic conditions.

After you meet your deductible, you pay a copayment or coinsurance each time you fill a prescription. A copayment is a flat fee — for example, $5 for a generic drug or $50 for a brand-name drug. Coinsurance is a percentage of the drug's cost — for example, you might pay 25% and the plan pays 75%. The amount you pay depends on the drug's "tier," which is the plan's category for that medication. Tier 1 drugs (usually generics) cost less; Tier 4 or 5 drugs (usually newer brand-name medications) cost more.

How drug tiers affect what you pay at the pharmacy

Every Medicare Part D plan organizes drugs into tiers. A plan might have four or five tiers, and each tier has its own copayment or coinsurance amount. Tier 1 is almost always generic drugs and costs the least. Tier 2 is usually preferred brand-name drugs. Tier 3 is non-preferred brand-name drugs. Tier 4 and sometimes Tier 5 are specialty drugs — expensive medications for conditions like cancer or rheumatoid arthritis.

The same drug can be in different tiers in different plans. One plan might put a common blood pressure medication in Tier 1 (generic, $5 copay), while another plan puts it in Tier 2 (preferred brand, $25 copay). This is why comparing plans matters if you take specific drugs. When you compare plans on Medicare.gov, you can enter your current medications and see exactly what each plan would charge you for each one.

If your plan does not cover a drug you need, or if the copayment is very high, you can ask your doctor to request an exception. The plan may agree to cover it at a lower cost or to move it to a lower tier. This process is called a formulary exception, and it can take a week or two.

The coverage gap and what happens after you spend a certain amount

Once you and your plan have spent a combined total of $5,030 on covered drugs in 2024, you enter the "coverage gap" (sometimes called the "donut hole"). In the gap, you pay a larger share of the drug cost — typically 25% of the price — until your out-of-pocket spending reaches $8,000. After that, you pay only a small copayment or coinsurance for the rest of the year.

The coverage gap amounts change every year. The $5,030 and $8,000 figures are for 2024 and will be different in 2025. You can find the current year's amounts on Medicare.gov or by calling your plan.

If you have a Low-Income Subsidy (see below), you do not enter the coverage gap. Your costs stay the same throughout the year.

Low-Income Subsidy: reduced or no costs if your income is low

If your income is at or below 150% of the federal poverty level, you may pay little or nothing for Medicare Part D. This program is called the Low-Income Subsidy (LIS), and it covers premiums, deductibles, and copayments. The income limit changes each year. In 2024, 150% of the federal poverty level was about $1,920 per month for a single person, though the exact amount varies by state and family size.

To learn about you may have access to, contact your local Social Security office, call Social Security at 1-800-772-1213, or visit ssa.gov. You can also call your state Medicaid office. If you may have access to, Social Security will enroll you in a plan automatically, or you can choose your own plan and Social Security will pay most of the costs.

Even if you do not think you may have access to, it is worth checking. Some people are surprised to learn their income falls within the limit, especially if they have very little savings or if their income dropped after retirement.

What to ask your doctor and pharmacist about costs

Before you fill a prescription, ask your pharmacist what the copayment will be. If it is higher than you expected, ask if a generic version is available or if your doctor can request a formulary exception to lower the cost. Some pharmacies also offer discount programs for uninsured or high-cost drugs.

Ask your doctor if there are lower-cost alternatives to the drug they prescribed. Sometimes a generic drug or an older medication works just as well and costs much less. Your doctor may not know the price difference without asking.

If you are struggling to pay for a drug, tell your doctor or pharmacist. Many drug manufacturers offer patient information programs that provide free or reduced-cost medications to people who meet income requirements. Your pharmacist can help you find these programs.

When to review your plan and make changes

Your costs may change every year, even if you stay in the same plan. Premiums go up or down, deductibles change, and drug tiers shift. A drug that was in Tier 1 one year might move to Tier 2 the next year. This is why it is important to review your plan every fall during the annual enrollment period.

The annual enrollment period runs from October 15 to December 7 each year. During this time, you can switch to a different Part D plan, switch to a Medicare Advantage plan that includes drug coverage, or drop Part D coverage altogether. Changes take effect on January 1. If you do not make a change during this window, your current plan continues into the next year.

Use the Medicare plan finder tool on Medicare.gov to compare plans for the upcoming year. Enter your current medications and see what each plan would cost you. Look at both the monthly premium and the total out-of-pocket cost for your drugs. Sometimes a plan with a higher premium has lower copayments and saves you money overall.

Frequently Asked Questions

Can I get help paying my Part D premium if I am on a fixed income?

Yes, if your income is low enough. The Low-Income Subsidy program covers premiums for people at or below 150% of the federal poverty level. You can also check with your state Medicaid office or local Area Agency on Aging to see if other programs in your state help with Part D costs.

What if my copayment is so high I cannot afford my medication?

Talk to your doctor about lower-cost alternatives, ask your pharmacist about generic versions, and ask if your plan will make an exception to lower the copayment. Many drug manufacturers also offer free medication to people who cannot pay. Your pharmacist can help you find these programs, or you can call the drug manufacturer directly.

Do I have to pay the same copayment at every pharmacy?

No. Copayments can vary between pharmacies, especially for brand-name drugs. Call ahead or use your plan's pharmacy finder tool to compare prices at different pharmacies near you. Mail-order pharmacies sometimes charge less for drugs you take regularly.

What happens to my costs if I move to a different state?

Your current plan may not be available in your new state, and even if it is, the premium and copayments may be different. You should review your plan options in your new state before you move or as soon as you arrive. You can make changes outside the annual enrollment period if you move, so contact your plan or Medicare.gov to update your address.

Do I pay Part D costs if I have a Medigap or Medicare Advantage plan?

It depends. If you have a Medicare Advantage plan, it usually includes drug coverage (Part D), and you pay that plan's copayments. If you have Original Medicare and a Medigap plan, Medigap does not cover drugs, so you still need a separate Part D plan. Some Medigap plans help pay copayments, but you must enroll in Part D separately.