Medicare Part D is a voluntary outpatient prescription drug benefit for people with Medicare provided through private plans that contract with the federal government.

One of the biggest expenses to many seniors and those on Medicare is the cost of Prescription drugs. There are several good insurance companies offering Medicare Part D. It is important to know what plans cover your medications and what the deductibles and copays are. Another thing to know is that your existing Medicare Part D plan may change their deductibles and copays each year. Every year there is Open Enrollment for Medicare Part D (your RX plan) where you can switch your Part D plans. There is no problem when you switch plans, no pre-existing conditions apply. So, I suggest you let me help you review what you have and decide if a change is good for you.

 

You can choose to enroll in either a stand-alone prescription drug plan (PDP) to supplement Traditional Medicare or a Medicare Advantage plan.

The 2026 Medicare Annual Enrollment Period (AEP) for Medicare Part D prescription drug plans is October 15–December 7, 2026. During this time, you can make changes to your Part D, and these changes will take effect on January 1, 2027.

 

What does Medicare Part D cover

Each Medicare Part D plan uses a list of approved drugs to decide what is covered and what is not. This list is called a drug formulary. The formulary may differ from plan to plan. Many plans arrange their list of covered drugs in various levels, called “tiers”. Generally, drugs in a lower tier will cost less than drugs in a higher tier. Here is one example of a typical Medicare drug plan’s tier system (but remember, your plan may be different):

•Tier 1 - Preferred Generic: Generic or brand drugs that are available at the lowest cost share for the plan

•Tier 2 - Generic: Generic or brand drugs that the plan offers at a higher cost to you than Tier 1 Preferred Generic drugs

•Tier 3 - Preferred Brand: Generic or brand drugs that the plan offers at a lower cost to you than Tier 4 Non-Preferred drugs

•Tier 4 - Non-Preferred Drug: Generic or brand drugs that the plan offers at a higher cost to you than Tier 3 Preferred Brand drugs

•Tier 5 - Specialty Tier: Some Injectables and other high-cost drug (Many injectables if administered in your Physician’s office are covered by Medicare Part B)

 

Medicare Part D RX Plans for 2026

There is some good news for Part D drug coverage. In 2025, the Part D “donut hole,” or coverage gap, closed. Once members reach their deductible, they will pay no more than 25% of the cost for Part D drugs covered by their plan until they reach a maximum out-of-pocket drug cost of $2,100. And once a member reaches $2,100 limit, they will pay nothing for covered Part D drugs for the rest of the year.

This change could have some major benefits for those people that have expensive medications they need to take. Important to check if the Part D Medicare Plan (RX plan) you choose does cover your Prescriptions. Not all plans are the same and some medications are not covered by any plans. Check with me, your insurance professional, if you are not sure how to do this. 

 

Medicare Prescription Payment Plan

The Medicare Prescription Payment Plan first offered in 2025 provides the option to people with Medicare prescription drug coverage to spread the costs of their prescription drugs over the calendar year rather than paying in full at the pharmacy counter each time they fill a prescription. 

Please know that not all RX plans offered participate in this Payment plan option. It makes good sense to check with an insurance professional like me to verify if your existing plan participates. If you are turning 65, let me help you select the best plan that does participate. Contact me before Open Enrollment begins October 15, 2026, we can see if your plan has changed. Using a professional insurance consultant like me for these challenges can be invaluable, so let me help you and know I love referrals and they love me!

 

Judi Woods