Prescription Drug Plans | Alight Retiree Health

Prescription Drug Plans

Prescription drug plans (Part D) can help reduce the cost of your medications, while providing more predictable charges. Remember: Original Medicare doesn’t cover most prescription drugs. The federal government sets guidelines that all Part D prescription drug plans must meet.

Each plan has a list of drugs that it covers (known as a formulary). Before choosing a Part D prescription drug plan, review its formulary to make sure your drugs are included.

Plans also have different charges, so check the annual deductible, premiums, copays, and coinsurance to ensure costs are covered.

Medicare Part D coverage is not automatic.
You must enroll for coverage to begin.
If you have other prescription drug coverage, such as Veterans Affairs (VA) coverage, you may not need an additional drug plan. Discuss any other coverage you have with a licensed Benefits Advisor.
Part D charges a late enrollment penalty if you don’t sign up when you’re first eligible—unless you qualify for an exception. The penalty is a fee set by Medicare that gets added to your premium, and you pay it for as long as you have Part D.
To enroll in a Part D prescription drug plan, you must first be enrolled in Original Medicare Parts A and/or B.

The Inflation Reduction Act

The Inflation Reduction Act of 2022 may help Medicare beneficiaries save money, improve access to affordable treatment, and strengthen the Medicare program. Visit medicare.gov to find out how it impacts you.

How Medicare Part D Works

Phase	Deductible phase	Initial coverage phase
Out-of-pocket range	$0 $590	$2,000
Your cost	100% of total drug costs	Your cost varies
	You’ll pay the full cost for your first $590 in covered prescription drug charges for the year before your drug plan begins to pay its share of costs. An exception is made for covered insulin products and vaccines, which do not require payment of a deductible.	After satisfying your $590 deductible, you’ll pay a copayment or coinsurance for each covered drug (as defined by your plan) and the plan pays its share. The initial coverage continues until you have paid a total of $2,000. After the initial coverage period, the plan pays all remaining costs.
These values are accurate as of October 2025. For the most current amounts, please visit medicare.gov.

Drug-related costs that count toward your total out-of-pocket costs:

Covered drug costs subject to your annual deductible
Coinsurance and copays you paid

Drug-related costs that do not count toward your out-of-pocket costs:

Plan premiums
Pharmacy dispensing fees (if any)
Costs of drugs not covered under your plan

Insulin products and vaccines

You pay at most $35 at most $35/month for covered insulin products (deductible is waived). Covered vaccines are free of charge (deductible is waived)