Guide to Medicare Part D: How Much Does Part D Coverage Cost?

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This page is part of our Guide to Medicare Part D.

There are three categories of out-of-pocket expenses associated with each Part D drug plan: Monthly Premium, Yearly Deductible, and Co-Payments. There also exist coverage gaps, which may increase out-f-pocket expenditures.

Coverage Gap- After you and your plan have spent a certain amount of money for covered drugs, you have to pay all costs out-of-pocket for your drugs up to a limit. There are plans that offer some coverage during the gap (i.e. generic drugs), but they may in return charge a higher monthly premium.  

The Monthly Premium is the amount you pay each month to the Part D plan for coverage.  Each Part D plan has a different Monthly Premium.  In Kentucky, the Monthly Premiums range from $12.30-$70.72.  On the Medicare website you can find the cost of Monthly Premiums of Part D plans offered in Kentucky.

The Yearly Deductible is the amount you pay out of your pocket each year before Medicare and the insurance begin coverage. This amount is in addition to your Monthly Premium. The amount of Yearly Deductible is never more than $250. Some plans have a lower deductible. 

A Co-payment is the amount you pay for your prescriptions after you have met the Yearly Deductible amount.  Your Co-Payment will vary depending on your total drug costs.  Some plans have lower Co-payments, and Co-payments may vary from drug to drug in the same plan. Here are the maximum Co-payments:

  • When your drug costs are between $251-$2,250, you pay 25% of the costs.
  • When your drug costs are between $2,251-$5,100, you pay all of your drug costs.
  • When your drug costs are above $5,100 in any one year, you pay 5% of the costs, or a co-pay of $2/$5, depending on your Part D plan.

Reviewed August 2009

This online guide was adapted with permission from Maine Legal Services for the Elderly. We extend our thanks to them.