Medicare Part-D

Medicare Part-D

Prescription Drug Plan

Medicare Part D plans provide beneficiaries with privately managed, federally approved prescription drug coverage. Original Medicare (Part A and Part B) does not include coverage for most prescription medications.

A plan’s list of covered drugs is called a “formulary,” and each plan has its own formulary. Many plans place drugs into different levels, called “tiers,” on their formularies. Drugs in each tier have a different cost. For example, a drug in a lower tier will generally cost you less than a drug in a higher tier.

A plan’s list of covered drugs is called a “formulary,” and each plan has its own formulary. Many plans place drugs into different levels, called “tiers,” on their formularies. Drugs in each tier have a different cost. For example, a drug in a lower tier will generally cost you less than a drug in a higher tier.

If you don't sign up for Part D when you're first eligible, you may have to pay a Part D late enrollment penalty.

As of January 2021, if you take insulin, you may be able to get Medicare drug coverage that offers savings on your insulin. You could pay no more than $35 for a 30-day supply. Let’s find a plan that offers this savings on insulin in your state.

Medicare Part D does have a monthly premium. If you do not enroll, you will incur a late penalty added to your premium from that point forward (unless you previously had credible coverage).

Part D premiums by income

The chart below shows your estimated prescription drug plan monthly premium based on your income as reported on your IRS tax return for 2022. If your income is above a certain limit, you'll pay an income-related monthly adjustment amount in addition to your plan premium.

If your filing status and yearly income in 2020 was

File individual tax return File joint tax return File married & separate tax return You pay each month (in 2022)
$91,000 or less
$182,000 or less
$91,000 or less
your plan premium
Above $91,000 up to $114,000
Above $182,000 up to $228,000
not applicable
$12.40 + your plan premium
Above $114,000 up to $142,000
Above $228,000 up to $284,000
not applicable
$32.10 + your plan premium
Above $142,000 up to $170,000
Above $284,000 up to $340,000
not applicable
$51.70 + your plan premium
Above $170,000 and less than $500,000
Above $340,000 and less than $750,000
Above $91,000 and less than $409,000
$71.30 + your plan premium
$500,000 or above
$750,000 and above
$409,000 and above
$77.90 + your plan premium

Part D late enrollment penalty:

The late enrollment penalty is an amount that's permanently added to your Medicare drug coverage (Part D) premium. You may owe a late enrollment penalty if at any time after your Initial Enrollment Period is over, there's a period of 63 or more days in a row when you don't have Medicare drug coverage or other creditable prescription drug coverage. You’ll generally have to pay the penalty for as long as you have Medicare drug coverage.

How much is the Part D penalty?

The cost of the late enrollment penalty depends on how long you went without Part D or creditable prescription drug coverage. Medicare calculates the penalty by multiplying 1% of the "national base beneficiary premium" ($33.06 in 2021, $33.37 in 2022) times the number of full, uncovered months you didn't have Part D or creditable coverage. The monthly premium is rounded to the nearest $.10 and added to your monthly Part D premium. The national base beneficiary premium may change each year, so your penalty amount may also change each year.

Trying to make sense of Medicare? Let us help, we’re not your typical agents.