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Medicare Part D Deductible Costs

Medicare Part D Deductible Costs, Summary: The deductible in Medicare Part D is the amount you pay for your prescription drugs before your plan begins to help. In 2021, the deductible under Medicare Part D cannot exceed $445 per year.

You probably know that being covered by insurance does not mean that you can always get free services and benefits. You can have several expenses incurred with Medicare insurance, including copays, co-insurance and deductibles. “Deductible” is a common term in insurance. In general, the lower the deductible, the less responsible you will be responsible for paying your pocket before your insurance coverage begins. The Medicare Part D deductible is the amount you pay most for your prescription drugs before your plan starts paying. The amount of the deductible in Part D of Medicare may vary from one plan, but Medicare requires that it does not exceed $445 per year in 2021.

Some plans do not have a deductible. According to eHealth 2020 research, average deductibles for independent health insurance Part D plans as part of the study increased from $335 in 2019 to $405 in 2020.

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Some plans in  Medicare Part D have a deductible of $0, meaning that you are only responsible for a co-payment amount or co-insurance established when you collect your prescription drugs. In some plans, the Part D deductible applies only to certain levels or prescription drugs, such as Level 3 and higher levels.

Prescription drug levels in Medicare Part D plan are generally set so that the lower the number of levels, the cheaper the drug will be, as in the following example:

  • Level 1: Generic Preferred, usually the lowest cost
  • level 2: generic, generally costs more than Level 1
  • Level 3: Preferred brand, generally costs more than Level 2
  • Level 4: non-preferred brand, generally costs more than Level 3
  • Level 5: Specialty level, generally costs more than Level 4
  • Level 6: Medicine for the selective care

If you are only taking generic prescription drugs, for example, you may not be subject to the deductible in some plans.

Medicare Part D Deductible Costs

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When will I meet my Part D deductible?

When you meet your Medicare Part D deductible depends on

  • the amount of the prescription drug deductible you are taking and
  • how much they cost
  • how many prescription drugs you take The amount you pay for your Medicare Part D deductible is for each calendar year and you have reset January 1.

Suppose your Part D deductible is the maximum allowed in 2021 ($445).

Scenario 1:

Prescription Drug 1 monthly cost Prescription drug 2 monthly cost Total monthly drug spending Month you reach your $445 deductible
$5 $15 $20 Never: Your total annual expense is only $240, so you pay that pocket amount.

Scenario 2:

Prescription Drug 1 monthly cost Prescription drug 2 monthly cost Total monthly drug spending Month you reach your $445 deductible
$15 $47 $62 August: 8 months of spending $62 = $496

Scenario 3:

Prescription Drug 1 monthly cost Prescription drug 2 monthly cost Total monthly drug spending Month you reach your $445 deductible
$100 $15 $115 April: 4 months of spending $115 = $460

Once you have reached your franchise, you may not be 100% covered. You can always be responsible for co-payments and co-insurance every time you fill out a prescription. Do you have any questions about your Medicare Part D deductibles?

Feel free to enter your postal code on this page to start browsing the Health Insurance Part D plans. Or if you prefer personalized support, contact eHealth to speak to a licensed insurance agent. We can help you find health plan options that fit your health insurance needs.

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