Medicare Part D
Medicare Part D provides prescription drug coverage for Medicare beneficiaries. Understanding your options, costs, and the 2026 out-of-pocket cap can save you thousands of dollars a year.
What Does Part D Cover?
Medicare Part D covers a wide range of prescription medications, including generic and brand-name drugs. Each plan has its own formulary — a list of covered drugs organized into tiers — which determines how much you pay for each medication.
Part D is offered by private insurance companies approved by Medicare. Plans vary in their premiums, deductibles, formularies, and pharmacy networks. This is why comparing plans based on your specific medications is far more important than just comparing monthly premiums.
The Inflation Reduction Act caps your annual out-of-pocket drug costs at $2,000. Once you hit that limit, you pay $0 for covered drugs for the rest of the year.
2026 Part D Costs at a Glance
Key numbers to know when comparing Part D plans this year.
| Cost Component | 2026 Amount | Notes |
|---|---|---|
| Maximum Deductible | $590/year | Many plans offer $0 deductible for Tier 1–2 drugs |
| Out-of-Pocket Cap | $2,100/year | After this cap you pay $0 for covered drugs for the rest of the year |
| Average Monthly Premium | ~$38.99/month | Varies widely by plan and location |
| Late Enrollment Penalty | 1% per month | Permanent — added to your premium for life |
The coverage gap (donut hole) that previously required beneficiaries to pay higher costs for drugs has been eliminated. Your out-of-pocket costs are now capped at $2,000 per year. After reaching that limit, you pay $0 for covered drugs for the rest of the year. Learn how the phases work.
The Extra Help Program
Extra Help (also called the Low Income Subsidy or LIS) is a federal program that helps people with limited income and resources pay for Part D costs. If you qualify, you may pay little to nothing for your prescription medications.
Millions of people who qualify for Extra Help never apply because they do not know about it. Our agents can help you determine your eligibility and walk you through the application at no cost.
You can apply through the Social Security Administration online, by phone at 1-800-772-1213, or in person at your local SSA office.
Income limits are approximate and adjusted annually. Asset limits also apply. Contact us for a free eligibility check.
Related Medicare Topics
Drug tiers, the 3 coverage phases, and how to read your plan's formulary.
How Medigap fills the gaps in Original Medicare and works alongside Part D.
A full overview of all four parts of Medicare and how they work together.
Medicare Part D Questions
Let Us Find the Right Part D Plan for You
We compare every Part D plan available in your area based on your specific medications, preferred pharmacies, and budget. We also check your Extra Help eligibility. The consultation is completely free.
We do not offer every plan available in your area. Currently we represent 17 organizations which offer 149 products in your area. Please contact Medicare.gov, 1-800-MEDICARE, or your local SHIP for information on all options.