Annual Deductible

There is a deductible you must pay for a Part D plan. Your deductible may be different, or waived entirely, but the max amount you can be charged is $545 in 2024. You will pay a discounted price for your medications until you have satisfied the deductible. After that, you begin initial coverage.

Initial Coverage

During initial coverage, you pay a copay for your medications based on your plan’s formulary. Each prescription drug plan separates its medications into tiers. Each tier has a copy amount for which you are responsible. It is typically separated by generic drugs, preferred name brands, even more specialized medications, and etc. In 2019, the initial coverage cap is $5,030. After you and the insurance company together have paid this amount, then you enter the coverage gap.

The Coverage Gap

During the coverage gap, you will still generally have significant discounts for generic medications. Typically, you will pay 25% for name brand medications and 37% for generics. Your gap spending will continue until you have paid $8,000 out of your own pocket in 2024.

Catastrophic Coverage

If you should spend past the coverage gap of $8,000 in 2024, your plan will begin to pay 100% of the costs of your formulary medications for the rest of the year