Medicare Part D Information

Medicare logoIn order to meet most prescription drug needs, Medicare allows private insurance companies to issue Medicare-approved prescription drug plans. These drug plans do not cover all prescription drugs. Beneficiaries should choose the plan that best covers their own prescription drug needs. Here are some basic rules to remember.

Drug Costs--

  1. Most Medicare-approved drug plans require that beneficiaries pay an annual deductible before the plan pays anything (see the maximum amount in row "1." in the chart below). However, some drug plans have no annual deductible.
  2. Most beneficiaries pay 25% of the drug costs after the deductible has been met (see row "2." in the chart below). Some drug plans charge less than 25%.
  3. Most beneficiaries pay 25% of the drug costs after the deductible has been met (see row "3." in the chart below). However, some individual drug costs may be different during this phase of coverage.
  4. Most beneficiaries pay 5% or less of the costs after their annual drug costs exceed the amount described row "4." in the chart below. You may pay less under some drug plans during this phase of coverage.

(Updated Feb 4, 2021)

Your Drug Costs in 2021
These are maximum amounts allowed, but you may pay less under some plans.
Annual drugs costs... % of drug costs that you pay... Your maximum costs for drugs are...
1. Up to $445 100% Up to $445
2. Over $445 25% Up to $4,130
3. Over $4,130 25%
(some individual drug costs may be different)
Up to $6,550
4. Over $6,550 The higher of 5% of drug cost or
$3.70 if generic or $9.20 if brand name drug
No maximum

Extra Help-- Help paying for drug costs.
(Updated Feb 4, 2021)

Extra Help in 2021
Also known as Low-Income Subsidy or LIS.
Financial assistance for costs associated with Medicare drug plans.
  Income
(May change when federal poverty level changes)
Assets
(may change when federal poverty level changes)
Premium Deductible Co-Pay
*Institutionalized (nursing home, etc.) with both Medicare & Medicaid or receive services under a Medicaid waiver, such as CCP in Illinois n/a n/a none
unless the plan's premium is more than $27.43 per month, varies by state
(source: Q1Medicare.com)
none none
Medicare & Medicaid (Full-Benefit Dual Eligible) & up to 100% FPL Up to $1,073
($1,452 for couples)
Up to $2,000
($3,000 for couples)
none
unless the plan's premium is more than $27.43 per month, varies by state
(source: Q1Medicare.com)
none $1.30 if generic or
$4.00 if brand name drug,
no co-pay after $6,550 out-of-pocket
*Full-Benefit Dual Eligible & more than 100% FPL, or Medicare Savings Program (MSP) participant, or Medicare & SSI, but not Medicaid recipient, or less than 135% FPL Between $1,073 to $1,449
($1,452 to $1,960 for couples)
Up to $7,970
($11,960 for couples)
none
unless the plan's premium is more than $27.43 per month, varies by state
(source: Q1Medicare.com)
none $3.70 if generic or
$9.20 if brand name drug,
no co-pay after $6,550 out-of-pocket
Medicare only & less than 150% FPL Between $1,449 to $1,610
($1,960 to $2,177.50 for couples)
Up to $14,960
($29,520 for couples)
Sliding scale based on percent of FPL
135-140% = 75% subsidy
141-145% = 50% subsidy
146-149% = 25% subsidy
$92
or plan's
deductible
if less
The higher of 5% of drug cost or $3.70 if generic or $9.20 if brand name drug
Premiums for Higher Income Beneficiaries-- The amounts below are the monthly Drug Plan's Premium (DPP) amount plus an additional amount for people with higher incomes.
(Updated Nov 23, 2020)

Your Medicare Drug Plan Monthly Premium in 2021
You Pay... If Your Annual Income is...
Individual Couple
Drug Plan's Premium (DPP) Up to $88,000 Up to $176,000
DPP + $12.30 $88,000 up to $111,000 $176,000 up to $222,000
DPP + $31.80 $111,000 up to $138,000 $222,000 up to $276,000
DPP + $51.20 $138,000 up to $165,000 $276,000 up to $330,000
DPP + $70.70 $165,000 up to $500,000 $330,000 up to $750,000
DPP + $77.10 $500,000+ $750,000+

Sources: Medicare Costs at a Glance & Social Security POMS

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