drug plans

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You may purchase Medicare Part D prescription drug coverage through stand-alone Medicare Prescription Drug Plans (PDPs) or through a Medicare Part C Medicare Advantage plan with prescription drug coverage (MAPDs). These plans have costs, including monthly premiums, annual deductibles, and copays/coinsurance.

PDPs: PDPs are offered by insurance companies that contract with Medicare to provide drug coverage. These plans are a good option for people who get their medical benefits through Original Medicare Parts A and B.

MAPDs: MAPDs are offered by insurance companies that contract with Medicare to provide members with medical benefits and prescription drug benefits (Medicare Part D). You must have Original Medicare Parts A and B to join a Medicare Advantage plan. You cannot have a Medicare Advantage plan and a stand-alone Part D plan at the same time.

You will move through stages of Part D drug coverage through the year, based on the cost of your prescription drugs. You may not move through all of the stages in a calendar year if your drugs are inexpensive.

Deductible stage: You may be responsible for 100% of the cost of covered drugs until you reach the annual deductible. You will move into the next stage once the deductible is met (maximum $590). Some plans eliminate the deductible; other plans only apply the deductible to brand name drugs.

Initial coverage stage: During this stage, the cost of drugs is shared by you and the plan. You will pay copays or coinsurance (approximately 25% of the cost of the drug), and the plan will pick up the remainder for covered drugs. Your copay or coinsurance amount is determined by what tier your drug falls in; most plans have five tiers (preferred generics, non-preferred generics, preferred brands, non-preferred brands, and specialty tier). Many plans have copays of $5 or less for preferred generic drugs!

You remain in this stage until your cumulative “true out-of-pocket costs” reach $2,000. Medicare counts every dollar that you spend on your Part D-covered drugs, and amounts paid by others may be included as well (for example, if you receive assistance through the Extra Help program). If your counted costs reach $2,000, you will not pay any additional copays for the remainder of the year.

Coverage gap stage: Also known informally as the “donut hole,” the coverage gap was eliminated for 2025.

Catastrophic coverage stage: If you reach the catastrophic stage, your Part D-covered drugs will be covered at no cost to you for the rest of the calendar year.

If you are comfortable using the internet, you can investigate your estimated costs for Medicare Part D. Go to www.medicare.gov/plan-compare, where you can enter information about the drugs that you take. The Medicare Plan Finder will show you the lowest-cost plans for you based on the estimated costs of your drugs.

• Instructions for creating a Medicare.gov account