Part D: Prescription Drugs
How Do I Pick the Right Prescription Drug Plan?
Part D plans look similar on the surface but can cost very differently depending on your exact medications. Here's how it works in 2026.
How Part D costs work in 2026
| Item | 2026 Amount |
|---|---|
| Maximum deductible | $615 |
| Initial coverage coinsurance | 25% of drug cost |
| Out-of-pocket cap | $2,100 |
| After the cap | $0 for covered drugs the rest of the year |
Source: CMS and NCOA 2026 Medicare Part D guidance. Plans may charge less than the maximum deductible; some have $0 deductible.
What happened to the "donut hole"?
It's gone. As of 2025, the old coverage gap was replaced by a simpler 3-phase structure: a deductible phase, an initial coverage phase where you pay 25% coinsurance, and a catastrophic phase where covered drugs cost $0 for the rest of the calendar year once you hit the $2,100 out-of-pocket cap.
Why the cheapest plan isn't always the cheapest plan for you
Every Part D plan has a formulary — a list of covered drugs sorted into cost tiers. The same medication can be a low-cost generic tier on one plan and a high-cost specialty tier on another. A plan with a higher premium but better placement for your specific medications often costs less overall than a low-premium plan with poor formulary placement.
Is there a penalty for enrolling late?
Yes. If you go more than 63 days without "creditable" drug coverage after becoming eligible for Medicare, you may owe a permanent late enrollment penalty: 1% of the national base beneficiary premium ($38.99 in 2026) for every month you went without coverage, rounded to the nearest 10 cents and added to your monthly premium for as long as you're enrolled in Part D.
Creditable coverage (like many employer plans) can help you avoid this penalty — we can help you confirm whether your current coverage qualifies.
Bring us your medication list
We'll run it against current plan formularies and show you the real annual cost difference, free of charge.