Medicare Prescription Drug Plans

Both generic and brand-name drugs are covered by Medicare Prescription Drug Plans, often known as Medicare Part D. If you already have Original Medicare (Part A and Part B), joining a prescription medication plan will expand your medical coverage and perhaps lower your costs. A Medicare Part D plan can be purchased separately or in conjunction with a Medicare Original Plan to augment your coverage.

A Medicare Advantage plan, usually referred to as Medicare Part C, is an additional choice for receiving prescription medication coverage.

Prescription Plans

Find out more about Prescription Drug Benefits

Benefits and Things to Think About for Prescription Drug Plans

  • Part D plans help provide prescription drug coverage for both generic and brand name medications. 
  • Part D plans assist in supplying prescription drug coverage for both generic and brand-name medications.
  • Prescription drug plans are run by commercial insurance businesses that have received approval from Medicare.
  • Depending on the plan you choose, the drugs you consume, and whether your pharmacy is in network, the cost of prescription drug coverage varies.

Plans might vary from year to year and cover prescription medications; therefore, the following queries must be resolved carefully:

  • Are all of your current drugs covered by the prescription drug plan?
  • In comparison to comparable plans, are the premiums for the Medicare Part D plan reasonable?
  • Can you order your prescriptions by mail or does the plan allow you to use your preferred pharmacy?

Facts about Prescription Drug Plans

These are the most well-liked plans and carriers in the US, according to the Centers for Medicare and Medicaid Services. Popularity, however, might not be the best indicator of which Medicare Prescription Drug plan is best for you. DreamhealthQuotes specializes in finding the best insurance for your healthcare needs and budget. 

Carrier Enrolled
Medco Containment Life and Medco Containment NY
UnitedHealthCare Ins. Co. & UHC Ins. Co. of NY
UnitedHealthcare Insurance Company

Source: August 2021

Four Stages of Prescription Drug Coverage

Prescription drug costs are covered in part by Medicare Part D programs for enrollees. Depending on which phase you are in as a Medicare beneficiary, your out-of-pocket expenses for prescription drugs may alter over time. The four stages of Medicare Part D’s prescription medication coverage are as follows:

Phase 1 of Prescription Drug Coverage: Medicare Deductible Timeframe

The Medicare Deductible Period is the first stage of prescription medication coverage. You will be responsible for covering any covered prescription medication expenditures during the deductible period up until your Medicare Part D plan deductible is met.


Deductibles differ amongst plans, but they shouldn’t go over $4,660 in 2023. Some drug plans even have deductibles of zero dollars, allowing you to skip phase 1 and proceed directly to phase 2, the Medicare Initial Coverage Period.

Medicare's Initial Coverage Period: Prescription Drug Coverage Phase 2

If you do not have a deductible ($0) or if your prescription drug payments are equivalent to your prescription drug plan’s deductible (up to a maximum of $505), the Medicare Initial Coverage Period begins immediately.


Your Medicare Part D plan will help cover some of the cost of your prescription medications during the Medicare Initial Coverage Period in exchange for a copayment (a predetermined sum) or coinsurance (a percentage of the drug’s cost) that is set by your plan.


The Medicare Initial Coverage Period expires whenever the combined retail costs of your prescription drugs reach $4,660 (what you pay and what your insurance covers). Some Medicare recipients will remain throughout this time for the entire calendar year.


Phase 3 of prescription drug coverage: the Medicare coverage void (donut hole)

Once you and your plan have spent a total of $4,660 on your covered prescription medications, you and your plan enter the Medicare Coverage Gap, still referred to as the Donut Hole. You will pay 25% of the retail price for both name-brand and generic prescription medications during this time. The Medicare Coverage Gap (Donut Hole) period ends whenever the sum of your out-of-pocket expenses for prescription medications reaches $7,400.

 Prescription Drug Coverage Stage 4: Medicare Catastrophic Coverage Period

The fourth and last stage of a prescription medication plan is the Medicare Catastrophic Coverage Period. Once your total out-of-pocket prescription drug expenses reach $7,400, the Catastrophic Coverage Period begins.

Once your out-of-pocket expenses for prescription drugs total $7,400, the Catastrophic Coverage Period begins.

Medicare Part D beneficiaries only have to make a minimal coinsurance or copayment for the rest of the calendar year while they are enrolled in the Medicare Catastrophic Coverage Period. Once the new year begins on January 1st, the Medicare Part D phases for prescription medication coverage begin.

Costs of a Prescription Drug Plan

The majority of Medicare prescription drug plans for seniors impose a monthly premium that varies depending on the plan and your location. You may be required to pay a Part D income-related monthly adjustment amount (Part D IRMAA) if your modified adjusted gross income is higher than a specific threshold.


A Medicare Prescription Drug plan’s yearly deductible in 2022 is $480. Depending on the plan, you can be required to pay the whole Part D deductible, a portion of it, or nothing at all.


Once your deductible has been met, you will pay a copay for your drugs depending on the drug formulary. Until then, you will pay the network-discounted price for your prescriptions. The insurance provider keeps tabs on your joint spending until the two of you have spent $4,430 in total by 2022. Once you reach this threshold, you will only be required to pay 25% for brand-name drugs and 25% for generics. You’ll keep paying these sums until your 2022 out-of-pocket expenses total $7,050.

Medicare Drug Plan Costs by Income

Your prescription medication plan’s expenses may increase if your income exceeds a specific level, according to If your income is higher than the Social Security Administration’s income thresholds, you may be required to pay this amount, known as the Medicare Income-Related Monthly Adjustment Amount (or IRMAA). The national basic beneficiary premium is often divided by your additional premium.

Prescription Drug Plan Premiums for 2023 vis-a-vis Income Tax Returns from 2021

Get a clearer understanding of your potential 2023 prescription medication plan premium using the table below. To determine how much you could pay for your prescription drug plan premiums in 2023, simply find the amount of your 2021 tax return.

If your filing status and yearly income in 2021 was
Individual Tax Return
Joint Tax Return
Married & Separate Tax Return
Prescription Drug Premiums (in 2023)
$97,000 or less
$194,000 or less
$97,000 or less
Your plan premium
above $97,000 up to $123,000
above $194,000 up to $246,000
not applicable
$12.20 + your plan premium
above $123,000 up to $153,000
above $246,000 up to $306,000
not applicable
$31.50 + your plan premium
above $153,000 up to $183,000
above $306,000 up to $366,000
not applicable
$50.70 + your plan premium
above $183,000 and less than $500,000
above $366,000 and less than $750,000
above $97,000 and less than $403,000
$70.00 + your plan premium
$500,000 or above
$750,000 and above
$403,000 and above
$76.40 + your plan premium

Prescription Drug Plans Enrollment Options

You are not forced to participate in a Medicare Prescription Drug Plan (PDP), but not doing so could result in serious consequences. This is because PDPs are an optional form of Medicare coverage. When you first become eligible for Medicare, you should enroll in a Medicare prescription drug plan to prevent any potential fines and guarantee coverage for prescription medications when you need it.

During the Medicare Advantage and Prescription medication Annual Enrollment Period (AEP), which runs from October 15 to December 7 each year, you can make adjustments to your prescription medication coverage.

Each year, the formulary and benefits of Part D plans are subject to change. Reviewing your prescription coverage during AEP is a smart idea because the formulary dictates how much of the cost of each medication they will cover. It’s possible to save money on a different plan even if your drugs don’t change, but if you’re content with your prescription drug plan, you can just let it renew on its own at the end of the year.

Before enrolling in a Medicare prescription drug plan, DreamhealthQuotes can assist you navigate your Medicare options.

Compare Medicare prescription drug plans with DreamhealthQuotes 

In just a few minutes, we objectively compare Medicare prescription drug plans for seniors from some of the most reputable insurance providers. Let us do the purchasing for you to save you time and the aggravation of navigating the Medicare maze. There is no requirement to sign up.

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