Medicare Drug Coverage: What You Need to Know About Prescription Costs and Plans

When you’re on Medicare drug coverage, the part of Medicare that helps pay for prescription medications. Also known as Medicare Part D, it’s not automatic—you have to sign up separately through a private insurer approved by Medicare. Many people assume their Medicare benefits cover all their pills, but that’s not true. Without Part D, you could pay full price for medications like insulin, blood pressure pills, or antidepressants—costs that can hit hundreds a month.

Not all drugs are covered the same. Each plan has a formulary, a list of drugs the plan agrees to cover. Drug list is key: if your medication isn’t on it, you’ll pay more or nothing at all. Plans also group drugs into tiers, with generics on the lowest tier and specialty drugs on the highest. The higher the tier, the more you pay out of pocket. Some plans require prior authorization before they’ll cover a drug, or step therapy—where you try a cheaper option first. And don’t forget the donut hole. After you and your plan spend a certain amount, you hit a coverage gap where you pay more until you reach catastrophic coverage. In 2025, you’ll pay no more than 25% of the drug cost in that gap, but that’s still a big chunk if you’re on expensive meds.

Out-of-pocket costs, what you pay before insurance kicks in. Drug expenses, include monthly premiums, deductibles, copays, and coinsurance. Some plans have $0 premiums but higher copays. Others charge more upfront but cover more of your drugs. The cheapest plan isn’t always the best—you need to match it to your actual prescriptions. If you take five meds, check how much each costs under each plan. Use Medicare’s Plan Finder tool to compare real prices for your drugs, not just the plan’s average cost. Many people miss this: if you’re on a low income, you might qualify for Extra Help, a federal program that cuts your Part D costs dramatically. You can apply through Social Security or your state Medicaid office.

Medicare drug coverage doesn’t just affect your wallet—it affects your health. Skipping pills because you can’t afford them leads to worse outcomes, hospital visits, and higher long-term costs. That’s why choosing the right plan matters. You’re not just picking insurance—you’re picking how you’ll manage your health year-round.

Below, you’ll find real-world guides on how medications interact, how generics work, how to save on prescriptions, and how to protect your personal data when handling pills. These aren’t abstract ideas—they’re the tools you need to make sense of your coverage, avoid dangerous mix-ups, and stretch your budget without sacrificing care.