Part D Prescription Drug Plans

Click on words in blue for definitions.


Medicare offers prescription drug coverage through Part D Prescription Drug plans. These plans are sold by Medicare approved insurance companies and cover the prescription medication listed in their formulary through their contracted pharmacies.

These plans come with a premium and can also have a deductible. Each time you pick up a prescription you usually will have a co-payment or co-insurance amount to pay.

Medicare sets the benefit limits for these plans and regulates your costs should you need coverage beyond the initial benefit amount.

If you do not enroll in a Prescription Drug plan when you are first eligible and you don’t have comparable coverage, you may have to pay a late enrollment penalty.

Extra Help If your income is limited and you need help paying for your prescriptions, you should contact Social Security to see if you qualify for “Extra Help” to reduce your prescription costs.


Each year Medicare determines what benefits the Part D Prescription Drug plan offers. Here are the Part D Prescription Drug plan benefits for 2017:

2021 Part D Prescription Drug Benefits
Initial Coverage Benefit Coverage Gap also known as the Donut Hole Catastrophic Coverage
Plan covers $4,130 of the cost of your prescription drugs.

This amount includes what you pay and what the insurance company pays for your drugs.

Each month you get an Explanation of Benefits showing the balance remaining in your Initial Coverage Benefit.

If you exhaust your Initial Coverage Benefit, you enter the Coverage Gap.

You pay all of your prescription costs until your total out of pocket expense reaches $6,550.

Pharmaceutical companies discount the cost of their brand name drugs. You pay 25% of the discounted price for brand name drugs and 25% for generic drugs.

Credit toward the $6,550 is given for any deductible, and all co-payments and co-insurances you pay plus the value of the pharmaceutical discounts.

If the Coverage Gap total is reached, your prescription drug costs drop to $3.70 for generics and $9.20for brand name drugs or 5% of the cost, whichever is greater.

Catastrophic Coverage continues until the end of the year.