Key Takeaways

  • If you have a Medicare Part D plan you may pay premiums, deductibles, copayments, and/or coinsurance for your prescription coverage.

  • The average monthly premium for a Part D plan is projected to be $55.50 in 2024, though plans vary.

  • Learn more about what people with Medicare Part D will pay for their prescription drug plans in 2024.

As we age, we're more likely to develop chronic health conditions and need prescription medications to manage these conditions. Medicare Part D (prescription drug coverage) helps ensure older adults can afford the medicines they need to stay healthy and independent.

Medicare Part D can help pay for the cost of prescription drugs. Medicare Part D covers outpatient prescription drugs through a standalone plan that works with original Medicare (Parts A and B) or as part of the benefits provided by a Medicare Advantage (Part C) plan. 

While Part D provides important benefits, it’s not free for most people. Below are some of the out-of-pocket expenses you can expect to pay in 2024.

Part D cost sharing

Most people who are enrolled in a Part D plan (and not eligible for the Part D Low-Income Subsidey (LIS or "Extra Help")—are resposible for certain expenses. These may include:

  • A monthly Part D plan premium (average estimated premium in 2024 is $55.50)
  • An annual deductible (maximum $545 in 2024)
  • A copayment or coinsurance during the initial coverage period
  • A percentage of the cost of drugs (25%) once you pass the initial coverage period and enter what used to be called the coverage gap

More Part D changes in 2024

Starting in January 2024, LIS/Extra Help will further reduce out-of-pocket costs for people with incomes between 135-150% of the Federal Poverty Level (FPL). It will eliminate “partial” subsidies and replace them with “full” subsidies. Enrollees will no longer pay a premium if they're enrolled in a benchmark plan. Also, they will have fixed, lower copayments (up to $4.50 for generic and $11.20 for brand-name drugs in 2024) and no deductible.

In addition, in 2024, the Limited Income Newly Eligible Transition (LINET) program will become permanent. LINET provides immediate but temporary Part D prescription drug coverage for low-income Medicare enrollees who qualify for LIS/Extra Help but have no drug coverage. This benefit is available for up to two months until a person enrolls in a Medicare drug plan.

People who receive both Medicare and Medicaid benefits ("dual eligibles") are automatically enrolled in LINET. If you're not dual-eligible but think you may qualify for LINET, ask your pharmacist.

To better understand how the Part D benefit works and how much you may have to spend, check out the 2024 Part D Standard Plan Cost-Sharing Chart.

Note: Some people with higher incomes will pay more for their Part D premiums. This is called IRMAA, or income-related monthly adjustment amount. Learn more about IRMAA.

Former coverage gap ("donut hole") payments 

If you exceed the spending threshold in the initial coverage period, you will enter what used to be called the Part D coverage gap/"donut hole." While this gap officially “closed” in 2020, you are still responsible for paying 25% of the costs of your generic and brand name drugs in this phase.

Where can I get help choosing a Medicare plan?

NCOA works with several broker partners who meet our strict Standards of Excellence. These licensed Medicare advisers will help you sort through your options and answer all your questions in clear, easy-to-understand terms. They’re dedicated to helping older adults make informed decisions about their Medicare coverage. Find out more today.