Turning 65 or already enrolled in Medicare? Chances are you’ve heard about Medicare Part D, the optional prescription drug coverage that’s more important than ever — especially if you take name-brand or specialty medications like Ozempic®, Mounjaro®, or Eliquis®. The Medicare landscape is shifting in 2026, and Part D plans are evolving in ways that could save you money, limit your out-of-pocket exposure, and give you more choices than before — but only if you know what to look for.
Let’s break it all down in plain English.
What Is Medicare Part D?
Medicare Part D is the part of Medicare that helps cover the cost of prescription medications. It is not required, but going without it may result in late enrollment penalties unless you have other creditable drug coverage (like from an employer or union).
You can get Part D in one of two ways:
As a standalone plan alongside Original Medicare (and possibly a Medigap supplement), or
As part of a Medicare Advantage Plan that includes drug coverage (often labeled MAPD).
What’s New in 2026?
Here are the major updates for the 2026 plan year:
✅ $2,100 Out-of-Pocket Cap
Thanks to the Inflation Reduction Act, your total out-of-pocket costs for prescription drugs are capped at $2,100 for the year in 2026 — no matter how
expensive your medications are. This is a game-changer for anyone taking costly drugs.
That means:
● No more “open-ended” costs.
● Once you spend $2,100 (not including premiums), you pay nothing more
for the rest of the year on covered prescriptions.
💊 How Deductibles Work (Up to $615 in 2026)
Most Part D plans include a deductible, which is the amount you pay before the plan starts helping. In 2026, the maximum deductible is $615, but some plans may charge less.
● Usually, the deductible only applies to Tier 3 and above drugs.
● Tier 1 and 2 (generics and preferred generics) often have no deductible and only small copays.
Understanding Drug Tiers and Costs
Each Part D plan places drugs into different tiers, which affect your costs. Here’s a general breakdown:
| Tier | Type of Drug | What You Might Pay |
|---|---|---|
| Tier 1 | Preferred Generics | $0–$5 copay |
| Tier 2 | Non-Preferred Generics | $5–$15 copay |
| Tier 3 | Preferred Brand | 17%–25% coinsurance |
| Tier 4 | Non-Preferred Brand | 35%–50% coinsurance |
| Tier 5 | Specialty Drugs | 25%–33% coinsurance (capped with new out-of-pocket max) |
Example:
Ozempic, Mounjaro, and Eliquis are often Tier 3 or 4, meaning you’ll pay coinsurance until you hit the $2,100 cap.
Formularies: Not All Plans Cover the Same Drugs
A formulary is each plan’s list of covered drugs. Just because a medication is covered by one plan doesn’t mean it’s covered by all.
● Plans can change their formularies each year.
● A drug might move to a higher tier or be dropped entirely.
● Always check if your medications are still covered during AEP (Annual Enrollment Period).
🔎 Pro Tip: Your Medicare advisor can run a personalized drug comparison to help you find the plan that covers your meds at the lowest cost.
Preferred Pharmacies vs. Standard Pharmacies
Part D plans often have a preferred pharmacy network, and using one can make a big difference:
● Lower copays at preferred locations.
● Mail-order options can offer even deeper savings.
● Some plans even offer $0 copays for Tier 1 drugs at preferred pharmacies.
Are All Part D Plans the Same?
Not at all.
Plans differ by:
● Monthly premium
● Deductible
● Drug coverage
● Pharmacy network
● Out-of-pocket costs
That’s why comparing plans based on your actual medications and pharmacy preferences is so important.
What About High-Income Medicare Beneficiaries?
If your income is over $103,000 (individual) or $206,000 (married filing jointly), you may pay more for Part D through an IRMAA (Income-Related Monthly Adjustment Amount). This is separate from the plan premium and paid directly to Medicare.
What You Should Do During AEP or OEP
Whether you’re enrolling during the Annual Enrollment Period (AEP) or Open Enrollment Period (OEP), here are key steps:
1. Review your current plan’s Annual Notice of Change (ANOC)
2. Check if your medications are still covered
3. Compare plans based on total annual cost — not just premium
4. Use a trusted Medicare advisor to simplify the process
Final Thoughts: Don’t Guess, Get Guidance
Choosing a Part D plan isn’t just about picking the lowest premium — it’s about getting the right coverage for your medications at the lowest total cost.
Between formularies, pharmacy networks, deductibles, and coinsurance, it’s easy to miss important details that can cost you thousands. And with 2026’s changes, it’s more important than ever to review your options.
💡 Your Medicare advisor can:
● Run a personalized comparison based on your prescriptions and
pharmacy
● Explain confusing tiers and coverage rules
● Ensure you’re not overpaying or under-covered
BONUS: 4 Quick Q&A’s for Your Newsletter
Are generics always cheaper than brand-name drugs?
Usually yes — and many Tier 1 generics are $0–$5. But always check with your plan.
Is Ozempic covered by Medicare Part D?
Yes, but it’s typically a Tier 3 or 4 drug, meaning you’ll pay coinsurance until you reach the cap.
Can I change my drug plan outside of AEP?
Only in certain cases, like moving or qualifying for Extra Help.
How do I find the best plan for my meds?
Your Medicare advisor can compare options tailored to your exact prescriptions.
