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Part D
Understanding
Prescription Coverage
Medicare Part D helps cover the cost of your prescription medications. These plans are offered by private insurance companies approved by Medicare, and each plan has its own list of covered drugs and costs.
When It Applies
Begins when you enroll in a Medicare drug plan and after you meet any plan deductible (up to $590 in 2025; some plans have no deductible).
What's Covered
Generic and brand-name prescription drugs on your plan’s formulary. May include certain vaccines, insulin products, and supplies. Coverage rules may apply (prior authorization, quantity limits, step therapy).
How Long You're
Covered
Through the Initial Coverage stage until your personal Part D out-of-pocket (OOP) costs reach $2,000 in 2025. After that, you enter Catastrophic Coverage and pay $0 for covered Part D drugs for the rest of the year.
What You'll Pay
Plan copays/coinsurance during Initial Coverage. After your OOP reaches $2,000, you pay $0 for covered Part D drugs through December 31. Insulin: max $35/month (no deductible under Part D). ACIP-recommended vaccines: $0.
Initial Coverage
*Your plan’s formulary, cost-sharing, and rules (like prior authorization or quantity limits) apply. You must continue to pay your Part D premium.
When It Applies
Starts once your personal Part D out-of-pocket costs reach $2,000 in 2025.
What's Covered
Covered Part D drugs on your plan’s formulary (generic and brand-name). Coverage rules may apply.
How Long You're
Covered
From the date you reach $2,000 out-of-pocket through December 31 of the same year.
What You'll Pay
for covered Part D drugs $0 during this stage. You must continue to pay your Part D (or plan) premium.
Catastrophic Coverage
*You must continue to pay your Part D premium. Applies only to covered drugs on your plan’s formulary.
When It Applies
Anytime you use your Part D benefit for a formulary prescription at a network pharmacy (including mail order).
What's Covered
ACIP-recommended vaccines, covered insulin products and supplies, and other formulary prescriptions. Coverage rules may apply (prior authorization, quantity limits, step therapy).
How Long You're
Covered
For the plan year while you remain enrolled and follow plan rules at network pharmacies.
What You'll Pay
$0 for ACIP-recommended vaccines; up to $35 per month for each covered Part D insulin (no deductible); plan-set copays/coinsurance for other covered prescriptions (after any deductible).
Special Rules & Plan Features
*Your plan’s formulary, network pharmacies, and coverage rules apply. You must continue to pay your Part D premium
When It Applies
If you qualify based on income and resources
What's Covered
Helps pay your Part D premiums, deductibles, and most drug costs—both brand-name and generics (formulary rules apply).
How Long You're
Covered
While you remain eligible; eligibility is reviewed each year.
What You'll Pay
In 2025: $0 premium and $0 deductible; up to $4.90 per generic and $12.15 per brand-name prescription. After your personal Part D out-of-pocket reaches $2,000, you pay $0 for covered Part D drugs for the rest of the year.
Extra Help (Low-Income Subsidy)
*You must meet income and resource limits to qualify. Reviewed annually.
Quick Basics about Part D
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What it covers: Prescription drugs you get at retail or mail-order pharmacies.
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How it works: Each plan has a formulary (list of covered drugs) and may include different tiers (generic, preferred, brand, specialty).
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Costs: You’ll typically pay a monthly premium, plus copays or coinsurance when you fill prescriptions. Costs vary by plan.
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Late enrollment penalty: If you don’t enroll when first eligible and don’t have other creditable drug coverage, you may pay a penalty later.
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With Medicare Advantage: Many Medicare Advantage (Part C) plans include Part D drug coverage, so you may not need a separate plan.
***Disclaimer: The information above describes Medicare Part D (Prescription Drug) coverage. Coverage, costs, formularies, and plan rules vary by plan and may change each year. You must continue to pay your Medicare Part B premium, if applicable, and any Part D plan premium. Check your plan’s Evidence of Coverage (EOC) for details.
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