Medicare Part D Prescription Drug Coverage

Medicare Part D helps pay for prescription medications. Part D coverage is offered by private insurance companies approved by Medicare.

You can receive prescription drug coverage through a stand-alone Medicare Prescription Drug Plan (PDP) that works alongside Original Medicare, or through a Medicare Advantage plan that includes prescription drug coverage (MA-PD).

Each plan has its own formulary, which is the list of medications the plan covers. Plans may also have different premiums, copays, coinsurance, pharmacy networks, and preferred pharmacies. Because your prescription costs can vary significantly from one plan to another, it's important to review your medications and pharmacy choices each year.

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How Medicare Part D Costs Work in 2026

For 2026, Medicare Part D generally has three coverage stages:

1. Deductible Stage
Your plan may have an annual prescription drug deductible. In 2026, a Part D plan cannot have a deductible greater than $615, although some plans have a lower deductible or no deductible at all.

2. Initial Coverage Stage
After meeting your plan's deductible, you pay the applicable copayment or coinsurance for covered medications. Under the standard Part D benefit, beneficiary coinsurance is generally 25%. Your actual costs can vary depending on your plan, medication, and pharmacy.

3. Catastrophic Coverage
Once your qualifying out-of-pocket spending for covered Part D drugs reaches $2,100 in 2026, you enter catastrophic coverage. At that point, you generally pay $0 for covered Part D drugs for the remainder of the calendar year.

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No More Part D “Donut Hole”

The Medicare Part D coverage gap, commonly called the “donut hole,” has been eliminated. Medicare Part D now uses the three-stage structure of deductible, initial coverage, and catastrophic coverage.

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Additional Part D Savings

Medicare Part D also includes important protections that may help lower prescription costs. In 2026, covered adult vaccines recommended by the Advisory Committee on Immunization Practices continue to have no cost sharing. Cost sharing for covered insulin products is also capped according to Medicare's applicable limits.

Medicare also offers the Medicare Prescription Payment Plan, which allows people with Medicare drug coverage to spread eligible out-of-pocket prescription costs throughout the calendar year instead of paying the entire amount at the pharmacy. This payment option does not reduce the total cost of the medications; it changes how those costs are paid.

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Choosing the Right Prescription Drug Plan Matters

The lowest-premium plan isn't always the least expensive plan for you. Your specific medications, dosages, pharmacy, formulary, drug tiers, deductible, copays, and coinsurance can all affect your total annual costs.

That's why it's important to review your Medicare prescription drug coverage each year. Plans can change their premiums, formularies, pharmacy networks, and other benefits.

We can help you compare available Medicare prescription drug options based on your medications, preferred pharmacy, and individual needs.

Medicare plan availability, premiums, formularies, pharmacy networks, copayments, coinsurance, and benefits vary by plan and service area.