Why Drug Costs Are a Major Concern
The average Medicare beneficiary fills approximately 50 prescriptions per year, and out-of-pocket drug spending averages over $1,500 annually even with Part D coverage. For those taking specialty medications, costs can be far higher. The good news: multiple strategies can significantly reduce what you pay at the pharmacy.
Strategy 1: Use the $2,000 Out-of-Pocket Cap
The Inflation Reduction Act capped Part D out-of-pocket costs at $2,000 per year. Once you reach that threshold, Medicare covers 100% of remaining drug costs. If you take expensive medications, you can also enroll in the Medicare Prescription Payment Plan, which spreads your out-of-pocket costs into equal monthly installments throughout the year — no interest charged.
Strategy 2: Apply for Extra Help (Low-Income Subsidy)
If your annual income is below approximately $22,590 (individual) or $30,660 (couple) and your assets are limited, you may qualify for Extra Help. This federal program pays for most of your Part D premium, eliminates the deductible, and reduces copays to $0–$11 per prescription. Apply through Social Security (SSA.gov) or your state Medicaid office.
Strategy 3: Compare Part D Plans Every Year
Drug plans change formularies, tiers, and pharmacy networks annually. Use Medicare Plan Finder at Medicare.gov to enter your exact medications and find the plan with the lowest total estimated annual cost — not just the lowest premium.
Strategy 4: Ask for Generics
Generic drugs are FDA-approved equivalents of brand-name medications at a fraction of the cost. On average, generics cost 80-85% less than their brand-name counterparts. Ask your doctor if a generic alternative exists for every brand-name drug you take. If your doctor prescribes brand-only, ask them to explain why the generic is not appropriate.
Strategy 5: Use Preferred Pharmacies
Most Part D plans have preferred pharmacy networks with lower copays. The same drug at a preferred pharmacy might cost $5, while a non-preferred pharmacy charges $25. Check your plan's pharmacy network and switch pharmacies if it reduces costs. Mail-order pharmacies often have the best pricing for maintenance medications.
Strategy 6: Request 90-Day Supplies
For maintenance medications you take regularly, ask for a 90-day supply instead of 30-day fills. Most plans charge less per pill for 90-day quantities, and mail-order pharmacies typically offer the best 90-day pricing.
Strategy 7: Explore Patient Assistance Programs (PAPs)
Pharmaceutical manufacturers offer PAPs that provide free or deeply discounted medications to qualifying patients. Programs exist for most expensive brand-name drugs and many biologics. Check each manufacturer's website or use NeedyMeds.org to find programs for your medications.
Strategy 8: Use the $35 Insulin Cap
All Part D plans must cap insulin costs at $35 per month per prescription, regardless of the type or quantity. If you take insulin, ensure you are benefiting from this cap. Some Medicare Advantage plans offer insulin at $0.
Strategy 9: Take Advantage of Free Vaccines
Under the Inflation Reduction Act, all ACIP-recommended vaccines are covered at $0 under Part D. This includes shingles (Shingrix), which previously cost $150+ out of pocket. Get all recommended vaccines to avoid costly preventable illnesses.
Additional Savings Strategies
- Strategy 10: Pill splitting — If your doctor approves, get a higher-dose pill and split it. Many tablets cost the same regardless of dose.
- Strategy 11: Therapeutic substitution — Ask your doctor about switching to a different drug in the same class that is on a lower tier in your plan's formulary.
- Strategy 12: State pharmaceutical assistance programs (SPAPs) — Many states offer additional drug subsidies. Check with your state pharmacy assistance program.
- Strategy 13: Discount cards and coupons — GoodRx and similar tools sometimes offer prices lower than your Part D copay for certain drugs. However, these payments do not count toward your Part D out-of-pocket cap.
- Strategy 14: VA benefits — Veterans may get lower drug costs through VA pharmacies, which can be used alongside Medicare.
- Strategy 15: Charitable foundations — Organizations like the HealthWell Foundation and Patient Advocate Foundation provide copay assistance for specific conditions.
- Strategy 16: Review your medication list with your doctor — Deprescribing (safely stopping unnecessary medications) reduces costs and side effects. Ask your doctor annually if every medication is still needed.
What NOT to Do
- Do not skip medications to save money — this leads to hospitalizations that cost far more
- Do not buy from unlicensed online pharmacies — counterfeit drugs are dangerous and widespread
- Do not ignore the Annual Enrollment Period — switching plans can save hundreds with 30 minutes of research