Medicare Part D Coverage
What exactly does Medicare Part D cover? When you enroll in a plan, you will receive a list of the plan’s accepted, covered drugs that you will be able to access. This is known as the plan’s formulary.
In this formulary, there are 5 tiers. These tiers categorized the covered prescriptions into different cost brackets. Tier one covers any drugs that are considered preferred and generic. This means that the doctors in your coverage radius “prefer” the drugs over their competitors. “Generic” means that the drug is identical to its brand name, more expensive counterparts.
Tier two includes non-preferred generic, i.e. prescriptions that are still cheaper yet identical it’s to brand-name counterparts but not preferred by doctors.
Tier three includes preferred brand-name drugs. You will be prescribed these if the prescription you need is not available in a generic drug, but still preferred by doctors.
Tier four includes non-preferred brand names. These are prescribed if a preferred counterpart does not exist.
Tier five is a unique tier, as it only covers “specialty” drugs. These are only necessary for specific conditions such as cancer.
Medicare Part D Costs
Medicare Part D costs are based on premiums, deductibles, and cost-sharing. Cost-sharing, either coinsurance or a copayment, is what you pay out of pocket each time you fill a prescription. The exact amount depends on the tier the drug falls into, with tier one being the least expensive and tier five the most.
Your premium and deductible depend on the plan you choose. Some plans are a much better fit than others for a given list of prescriptions, so it pays to compare the options available in Ocean and Monmouth County rather than defaulting to the cheapest premium.
The old "donut hole" coverage gap is gone. Since 2025, every Part D plan has a hard annual cap on what you pay out of pocket for covered drugs, which is $2,100 for 2026. Once you reach it, your covered prescriptions are $0 for the rest of the year. You can also spread those costs into monthly payments through the Medicare Prescription Payment Plan.
If you need additional help with Part D costs, you may qualify for the Extra Help program, which can lower or eliminate premiums, deductibles, and copays. I'll check whether you're eligible as part of every plan review.
Enrolling in Part D
Virtually everyone eligible for Medicare can enroll in a Part D plan. When you first become eligible at age 65, you can enroll in a plan in addition to your Original Medicare coverage, or through a Medicare Advantage plan that includes Part D coverage. If you’re past initial enrollment, you can add it to your coverage during the Annual Enrollment Period (AEP).
Explore Part D with
Holowchuk Health Advisors
Let's find the right Part D plan for your prescriptions. Call (732) 554-3021 or book a free consultation below.