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Health Care Reform:

Health Insurance & Affordable Care Act

What Does Medicare Cost?

Medicare Part D

Part D is your prescription drug coverage

Premium costs. The monthly fee you pay varies by the plan you choose. The average premium for the last 3 years has been $30, and in 2014, it's predicted the average will be $31. If you have a higher income, you may pay more each month. In 2013, households with income of more than $170,000 or individuals with income greater than $85,000 will pay between $11.60 and $66.60 more per month.

Deductible costs: Each year you pay a deductible before Medicare starts sharing the cost for your medicines. Although the deductible may vary from plan to plan, no plan may charge more than $325 in 2013. In 2014, the maximum will be $310.

After you've paid the deductible, your Medicare prescription drug plan kicks in and you pay a copay or coinsurance.

Copay costs: The part you pay for your medicines is either called a copay or coinsurance. The amount depends on the plan you've chosen. You may pay more for some drugs than others, such as brand-name drugs.

Costs in the doughnut hole: If you spend a certain amount on medicines, you'll have a gap in your drug coverage, which is often called the doughnut hole. 

While in the doughnut hole, in 2013 you pay 47.5% of the cost for a brand-name medicine. This will steadily decrease to 25% in 2020. After 2020, the doughnut hole will disappear.

For generic medicine, you pay 79% of the cost in 2013. This will steadily decrease to 25% in 2020. After 2020, the doughnut hole will disappear.

 

 

You’ll Pay This Percentage for Brand-Name Drugs
in the Doughnut Hole
You’ll Pay this Percentage for Generic Drugs
in the Doughnut Hole

2013

47.5%

79%

2014

47.5%

72%

2015

45%

65%

2016

45%

58%

2017

40%

51%

2018

35%

44%

2019

30%

37%

2020

25%

25%

 

After the total cost of your drugs (what you and your health plan paid combined) reaches a certain level, Medicare stops paying for them. In 2013, that level is $2,970. For 2014, it will be $2,850.

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