Medicare Prescription Drug Plans
How Much Do They Cost?
Each plan has different costs, including:
• Monthly premium – what you pay each month, even if you don’t use it
• Copay – a small amount you pay each time you get a prescription
• Deductible – what you pay out-of-pocket before the plan helps
Some plans have $0 deductibles or low premiums if you qualify for help.
📦 What Medicines Are Covered?
Each plan has a list of covered drugs called a formulary.
• Cheaper plans might only cover basic medicines
• More expensive plans cover more brand-name or specialty drugs
Plans put drugs into tiers:
• Tier 1 = cheapest (generic drugs)
• Tier 2 = low cost
• Tier 3–5 = higher cost (brand names or specialty)
🧱 Drug Coverage Stages
Here’s how drug costs work during the year:
1. Deductible stage – You pay all the cost until you meet the deductible.
2. Initial coverage – You pay a share, and the plan pays most of it.
3. Coverage gap (donut hole) – You pay up to 25% of the cost.
4. Catastrophic coverage – You pay nothing after your total costs hit a maximum ($8,000 in 2025)
👴 Who Can Get Help Paying?
There’s a program called Extra Help for people with lower income. It makes plans almost free and lowers copays.