Medicare Part D is prescription drug coverage sold by private plans approved by Medicare. In 2026 a plan can charge a deductible of up to $615, and once your out-of-pocket spending on covered drugs reaches $2,100, you pay nothing more for covered drugs that year. You can get Part D as a stand-alone plan alongside Original Medicare, or inside most Medicare Advantage plans.
Source: CMS, Contract Year 2026 Part D Redesign Program Instructions
How Part D works
Every plan has a formulary, its list of covered drugs, grouped into tiers. Lower tiers (usually generics) cost less. The same drug can sit on different tiers in different plans, and plans can use rules like prior authorization or step therapy. That is why we start with your exact prescription list, dose and pharmacy.
Your 2026 costs, step by step
| Stage | What you pay in 2026 |
|---|---|
| Deductible | Up to $615, depending on the plan (many plans have a lower one or none on generics) |
| Initial coverage | Your copays or coinsurance by tier |
| Catastrophic (after $2,100 out of pocket) | $0 for covered drugs for the rest of the year |
You can also spread your drug costs across the year in monthly payments through the Medicare Prescription Payment Plan, which your plan offers on request.
The late-enrollment penalty
If you go 63 days or more without Part D or other creditable drug coverage after you first become eligible, Medicare adds a penalty to your premium for as long as you have Part D: 1% of the national base premium ($38.99 in 2026) for each month without coverage. Use the Part D penalty calculator to see the math.
Extra Help
If your income and resources are limited, the Extra Help program pays most Part D premiums and copays. You can apply through Social Security. If you might qualify, tell us and we will point you in the right direction.
How to compare Part D plans
- List every prescription, the dose and how often you take it.
- Pick the pharmacy you use, since preferred pharmacies can cost less.
- Compare total yearly cost (premium plus drug costs), not just the premium.
- Check every drug against each plan’s formulary and rules.
- Repeat it every fall. Formularies and prices change every January.