Medicare Part D covers prescription drugs for Medicare and can be purchased from a private insurance company. The average monthly premium for Part D is around $55 in 2024.
Launched in 2006, Part D is Medicare’s prescription drug coverage. The goal of Medicare prescription drug plans is to decrease costs for people ages 65 and older.
If you are eligible for Medicare, you are required to have an adequate form of prescription drug coverage. You can buy coverage from a company that offers Medicare Part D, through a Medicare Advantage plan, or from a private health insurance plan that meets Medicare coverage requirements.
There are several factors that determine what you’ll pay for your Medicare Part D plan. Keep reading to find out more about Medicare prescription drug coverage and what it may cost.
Generally, the Centers for Medicare & Medicaid Services (CMS) estimate the average total monthly Part D premium is projected to be around $55.50 in 2024, which is up from $56.49 in 2023.
That said, your Medicare Part D costs can vary based on your plan and your income. The cost of the plan can also depend on the number of drugs it covers and the amount you pay out of pocket for generic and brand-name drugs.
In addition to a monthly premium, you may also have to pay an annual deductible as well as copayments or coinsurance for certain drugs. Having Part D insurance can help cut down on many of these costs, but you will likely still have to pay some amount for brand-name prescription medications.
IRMAA
Note that if your modified adjusted gross income is higher than a certain amount, you may have to pay an extra monthly premium.
Medicare calls this an income-related monthly adjustment amount (IRMAA). Medicare calculates this amount based on your tax return from 2 years ago.
In 2024, if your annual income is $103,000 or less as an individual or $206,000 or less on a joint tax return, you won’t have to pay an IRMAA. The highest IRMAA, an added $81 per month, is for an individual who makes $500,000 or more or files a joint tax return amount of $750,000 or more.
The following chart summarizes the costs of several Part D plans around the country in 2024. The costs have been gathered via the search tool on Medicare.gov. Enter your own zip code to see the costs in your area.
Aetna SilverScript SmartSaver (most budget-friendly) plan costs:
| Brooklyn, NY | Los Angeles, CA | Chicago, IL | Santa Fe, NM | |
|---|---|---|---|---|
| Monthly premium | $31 | $18.60 | $9.90 | $19 |
| Annual deductible | $280 | $280 | $280 | $280 |
| Copay: tier 1 | $0 | $0 | $0 | $0 |
| Copay: tier 2 | $5 | $5 | $5 | $5 |
| Copay: tier 3 | 23% of cost | 24% of cost | 24% of cost | 24% of cost |
| Copay: tier 4 | 50% of cost | 50% of cost | 50% of cost | 50% of cost |
| Copay: tier 5 | 29% of cost | 29% of cost | 29% of cost | 29% of cost |
Humana Premier Rx plan costs:
| New York, NY | Atlanta, GA | Albuquerque, NM | Seattle, WA | |
|---|---|---|---|---|
| Monthly premium | $135.40 | $110.70 | $73.20 | $104.80 |
| Annual deductible | $0 | $300 | $500 | $200 |
| Copay for preferred pharmacy tier 1 generics | $1 | $1 | $1 | $1 |
| Tier 2 copay | $4 | $4 | $4 | $4 |
| Tier 3 preferred brands | $45 | $45 | $45 | $45 |
| Tier 4 | 39% of cost | 49% of cost | 49% of cost | 49% of cost |
| Tier 5 | 33% of cost | 28% of cost | 28% of cost | 30% of cost |
Monthly premiums for three stand-alone Medicare Part D plans from Cigna:
| Los Angeles, CA | Fort Lauderdale, FL | Chicago, IL | Philadelphia, PA | |
| Cigna Saver Rx | $15.80 | $16.80 | $18.00 | $20.40 |
| Cigna Secure Rx | $34.50 | $59.70 | $42.30 | $40.90 |
| Cigna Extra Rx | $105.90 | $94.80 | $78.40 | $91.00 |
The IRMAA is usually deducted from your Social Security check. If not, you may receive a bill from Medicare or the Railroad Retirement Board, and you must pay this amount to keep your coverage.
In addition, you can also deduct your plan premium from social security. Because Part D is often administered by a private insurance plan, you’ll need to arrange this with the provider directly.
You can enroll in Medicare Part D during your Medicare initial enrollment period (IEP), which runs from three months before your birthday to three months after.
This is the same as when you qualify for Medicare in general, which is 3 months before your 65th birthday, your birthday month, and 3 months after you turn age 65.
Some people may qualify for Medicare Part D at an earlier age if they have medical conditions such as amyotrophic lateral sclerosis (ALS), end stage renal disease (ESRD), or a disability that qualifies for Social Security Disability Insurance.
In addition, you can make changes to your current Part D plan during the open enrollment period from October 15 to December 7. If you have Medicare Advantage but wish to switch to Original Medicare with or without Part D, you can do so between January 1 and March 31:
What is the Medicare Part D late enrollment penalty?
You may owe a Medicare Part D late enrollment penalty if you do not have any form of prescription drug coverage for 63 days in a row after your IEP. You will be required to pay this penalty for as long as you have Medicare coverage.
The Medicare Part D late enrollment penalty you must pay depends on how long you did not have any form of prescription drug coverage. The longer you went without coverage, the higher the penalty.
That said, If you receive a notification you’re being charged for prescription drug coverage and you think it’s in error, you can appeal this decision. You must file an appeal within 60 days from when you received a letter notifying you of the late enrollment penalty.
Learn more: Medicare deadlines and the Medicare late enrollment penalty.
Medicare Part D plans have made prescription medications more affordable. If you or a loved one is age 65 or older, you are required to have qualifying prescription drug coverage.
If you do not sign up during your enrollment period, you could face permanent penalties.