Medicare Part D
Your drug coverage, phase by phase
What you pay for a prescription changes over the course of the year. Here is the order it happens in, and what each stage means for your out-of-pocket cost.
Start with the formulary
Each plan has its own formulary — the list of drugs that plan covers. To see whether your prescriptions are on it, look online or call your carrier.
Why costs differ
A drug's cost varies by tier, by source — where you fill it — and by phase of coverage.
The three phases
Deductible
You first meet the annual Part D deductible — up to $615 in 2026 — that applies to the drugs in your plan's tiers. Once it's met, you move into Phase 2.
Initial coverage
You pay a copayment or coinsurance each time you fill a prescription for a drug covered on the formulary. In 2026 there is a $2,100 cap on what members pay out of pocket for covered Part D drugs, counting deductibles, copays and coinsurance. Pass it and you move into Phase 3.
Catastrophic
You pay $0 for your covered Part D drugs for the rest of the year. On January 1 the cycle begins again, and you start back in Phase 1 or 2 depending on your plan.