If you are enrolled in Original Medicare, you may notice that prescription drug benefits are not covered. So, in order to receive these benefits, you must enroll in Medicare Part D. Medicare Part D plans are tailored to best fit the drugs you are taking and provide you with the best coverage options.
However, this coverage does not come without costs. Medicare Part D costs vary by plan and are dependent upon your income. Below we discuss Medicare Part D costs and how to get the most out of your Medicare Part D plan.
How Much Does Medicare Part D Cost?
Medicare Part D costs consist of premiums, deductibles, copayments, and coinsurances. Each Medicare Part D plan has its own unique set of costs, however there are certain costs that stay the same throughout.
The chart below lays out all Medicare Part D costs for 2023.
Keep in mind, if you delay Medicare Part D enrollment, you could be subject to the Medicare Part D late enrollment penalty. Once assessed, this penalty stays with you for life.
| Medicare Part D Costs in 2022 | |
|---|---|
| Average Monthly Medicare Part D Premium | $31.50 |
| Annual Medicare Part D Deductible | $0-$505 |
| Coinsurance/Copays | Each plan has a unique set of copays associated with it, however, once your drug costs reach $4,660, you will enter the Coverage Gap. During the Coverage Gap, you are responsible for 25% of the retail cost of your drugs. Once your costs reach $7,050 you reach the catastrophic phase. In this phase, you are responsible for 5% of the cost of your drugs or $3.95 for generic medications and $9.85 for brand medications, whichever cost is higher. |
Medicare Part D Premium Adjustment Costs
When it comes to Medicare Part D premiums, if your annual income exceeds a certain threshold, your Medicare Part D costs could see an increase from the typical premium. This is known as an Income Related Monthly Adjustment Amount. This fee is an additional cost on top of the typical Medicare Part D premium.
The chart below depicts how the additional cost would affect those whose income is in each bracket.
| Single tax return in 2021 | Joint tax return in 2021 | Married and filed single in 2021 | You each pay |
|---|---|---|---|
| $0 - $97,000 | $0 - $194,000 | $0 - $97,000 | Your chosen plan premium |
| $97,001 - $123,000 | $194,001 - $246,000 | N/A | Your chosen plan premium +$12.20 |
| $123,001 – 153,000 | $246,001 - $306,000 | N/A | Your chosen plan premium + $31.50 |
| $153,001 - $183,000 | $306,001 - $366,000 | N/A | Your chosen plan premium + $50.70 |
| $183,001 - $499,999 | $366,001 - $749,999 | $97,001 - $403,000 | Your chosen plan premium + $70.00 |
| $500,000 + | $750,000 + | $403,001 + | Your chosen plan premium + $74.40 |
How To Get Help With Medicare Part D Costs
If you are having trouble covering the cost of your Medicare Part D plan premium, deductible, or copayments, there are options available to you. Medicare offers a variety of assistance plans to help cover these costs.
If you qualify for Medicaid or Extra help, your Medicare Part D costs are reduced drastically. To check if you qualify, contact your local social security for information on how to apply.
