The cost of Medicare Part D and how and when you pay for it varies from plan to plan. With that said, most are paid on a monthly basis in addition to your Medicare Part B payment.

Yearly Deductibles for 2023

Deductibles for 2023 Medicare Part D coverage cannot exceed $505.

Coinsurance & Co-payments

Even after meeting your deductible, you may pay a portion of the cost of your medications via coinsurance or co-payments. After you and your insurance provider spend a total of $4,660 on prescription drugs, the cost of your medications cannot exceed 25% of their price. This price reduction continues until you hit $7,400 in out-of-pocket spending.

The “Donut Hole” Explained

Upon hitting the $4,660 threshold on prescription drug spending, you will likely enter a gap, or donut hole, in coverage. It’s important to note that once you’re in the coverage gap, even though you’ll only pay 25% of your prescription drugs, almost the full price of the medication counts as an out-of-pocket expense.

Catastrophic Insurance Coverage

Catastrophic coverage comes into play once you’ve hit $7,400 in out-of-pocket expenses, which also means you’re out of the coverage gap. At this point, you will only pay a small co-payment or coinsurance percentage for covered medications until the following year.

Extra Help

The Extra Help program is government-sponsored and offers assistance to those that may not have the resources to afford prescription drug coverage on their own. Here are some of the qualifying conditions:

  • Your state Medicaid program assists with Part B Premiums
  • You receive Supplemental Security Income (SSI) benefits
  • You currently have full Medicaid coverage

You can also apply for Extra Help at any time via the Social Security website.