Part D Prescription Drug Plans

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You can sign up for Part D Prescription Drug Plans, which helps cover prescription drug costs, along with other components of Medicare starting three months before your 65th birthday, or if you are under 65 and eligible for Medicare.

It's important to do this on time because there' may be a permanent premium surcharge for enrolling after your initial enrollment period if you don't have equivalent drug coverage from another source, such as a retiree plan.

Let us help you with your enrollment

If you are already enrolled in a Part D "standalone" plan or a Medicare Advantage plan that incorporates drug coverage, you can switch plans during the open-enrollment period, which runs from Oct. 15 to Dec. 7 every year.

Making Part D work

In 2025, several significant updates will affect Medicare Part D enrollees, including a substantial improvement with the implementation of a $2,000 out-of-pocket cap. This means that once you reach $2,000 in prescription expenses, you will not have additional out-of-pocket costs for the remainder of the year. This change represents a notable reduction from previous thresholds, aimed at helping individuals manage high prescription costs throughout the year.

Additional changes include the elimination of the “coverage gap” phase, sometimes referred to as the “donut hole,” where beneficiaries previously faced a change in cost-sharing. Starting in 2025, you will continue to pay consistent cost-sharing percentages in the initial phase, removing the complex transition to higher out-of-pocket costs that had occurred mid-year. The deductible is also rising slightly to $590 for many plans, although this may vary depending on individual plan details.

Part D drug benefits in 2025 are structured into three phases:

Annual deductible -  If your plan has a deductible, you will pay 100% of your gross covered prescription drug costs until the annual deductible is met. 

Initial coverage - Once the annual deductible is met, you will pay 25% coinsurance for covered Part D drugs. This phase ends when you have reached the annual out-of-pocket cap of $2,000 for 2025. 

Catastrophic - Once you meet the $2000 out-of-pocket cap, you will pay no cost sharing for covered Part D drugs. 

These updates aim to make Part D costs more predictable and manageable, especially for those with high-cost medications. The changes are part of the broader Inflation Reduction Act adjustments, which bring greater financial relief to Medicare enrollees in need of costly prescriptions.

Choosing a plan

It pays to review your Part D coverage every year, especially if you have started taking new drugs.

Start at Medicare.gov, where you can find the basics about the benefit and Part D plans. There's a link to the Medicare Part D Plan Finder, which allows you to compare offerings and coverage options in your area and includes a helpful formular finder that allows you to compare plans based on their coverage of your personalized list of drugs. It will even show you your monthly out-of-pocket drug cost for the year

Getting financial help

Individuals with 2024 annual incomes of less than $22,590 and financial resources of up to  $17,220 or married couples with incomes of less than r $30,660 and financial resources of up to  $34,360 might qualify for Extra Help from Medicare to pay their Part D premiums and out-of-pocket drug costs.