Step 3. Figure Out Costs

What will Medicare Part D cost me, and what will it pay for?

If you do not qualify for Extra Help with costs, you will pay:

  • Monthly premiums
  • Yearly deductible (if any)
  • Copay or coinsurance for each prescription

If you do qualify for Extra Help with costs because of your limited income, you will pay:

  • Low or no monthly premiums
  • Low or no yearly deductible
  • Low or no copay or coinsurance for each prescription

At the end of the 7 Simple Steps, you will be able to find out if you qualify and apply for Extra Help.

You can choose from many plans with different costs. In most cases, you should look for plans that have the lowest OVERALL annual cost each year. Think about how much the drugs you take cost in each plan. Your overall annual cost includes your premiums, deductibles, copayments or coinsurance for each prescription, and any drug costs you pay during the coverage gap.


After you finish this introduction, you can go to the Plan Finder and get a list of plans. Then you can compare their overall annual yearly costs.

What is the coverage gap, and what do I pay?

Medicare also cares about what they call your total drug costs. Your total drug cost is what you pay for the prescriptions on your plan’s drug list, plus what your plan pays for your prescriptions.

cost2If your total drug costs (what you and the plan pay for your prescriptions on your plan's formulary) are greater than $2,850 in 2014, you will probably hit the “coverage gap,” sometimes called the donut hole.

While you are in the coverage gap, you will get discounts on certain drugs your plan covers.

Learn more about what you will pay in the coverage gap.

NEXT: Step 4. Determine which drugs the plans cover

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