Jeffrey Wade
Medicare Part D is a prescription drug benefit available for all beneficiaries enrolled in Medicare, helping to keep drug costs manageable. The cheapest Medicare drug insurance will depend on your budget, ability to meet the deductible, the number of prescriptions you need, and where your prescriptions fit into a plan's formulary tiers and pricing. Some companies that offer the lowest premiums and out-of-pocket prices include Wellcare, UnitedHealthcare, and Cigna. Pharmaceutical Assistance Programs (PAPs) are also available to help pay for medications for people enrolled in Medicare drug coverage (Part D).
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What You'll Learn
Medicare Part D plans with $0 premiums
Medicare Part D is a program that provides outpatient prescription drug coverage to over 50 million older adults and people with long-term disabilities. As of 2020, there were two ways to get Part D coverage: through a stand-alone Prescription Drug Plan (PDP) to supplement Original Medicare, or through a Medicare Advantage plan (Part C) that includes prescription drug coverage.
Most stand-alone Medicare Part D Prescription Drug Plans charge a monthly premium for prescription drug coverage, and the premium varies by plan. However, some people have reported having a $0 premium plan, where only a few medications have any cost associated with them, and the rest are generic and free.
In 2025, the average monthly premium for Part D coverage was substantially higher for PDPs than for Medicare Advantage plans ($39 versus $7). This is because most Medicare Advantage plan enrollees are on zero-premium plans.
It is important to note that even if you enroll in a Medicare Advantage plan with a $0 premium, it is not truly free coverage. You may still have to pay deductibles, coinsurance, and copayments. Additionally, $0 premium plans are not available in all areas.
If you have limited income and resources, you may be able to get Extra Help to pay your plan premiums and other drug costs. Extra Help is a government program that assists people with Medicare and low incomes in paying for their prescription drug coverage. This program is not available in Puerto Rico, the U.S. Virgin Islands, Guam, the Northern Mariana Islands, or American Samoa, but there are other programs available in those areas to help people with limited income and resources.
Medicare also offers a Limited Income Newly Eligible Transition (LI NET) Program, which provides temporary Medicare Part D drug coverage to people who qualify for Extra Help but are not yet enrolled in a Medicare drug plan.
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Medicare Prescription Payment Plan
The Medicare Prescription Payment Plan is a payment option that helps you manage your out-of-pocket prescription drug costs. This plan can be used by anyone with a Medicare drug plan or a Medicare health plan with drug coverage, such as a Medicare Advantage Plan.
Under this plan, you will continue to pay your plan premium (if you have one) each month, and you will receive a bill from your health or drug plan to pay for your prescription drugs, instead of paying at the pharmacy. This means that your out-of-pocket prescription drug costs will be spread across the calendar year (January-December), helping you manage your monthly expenses. However, it is important to note that this plan does not reduce your overall drug costs or save you money.
The Medicare Prescription Payment Plan is especially useful if you have high prescription drug costs at the beginning of the year. For example, instead of paying $500 out-of-pocket per month for the first four months of the year for a covered Part D drug, you would pay approximately $181.32 per month over the course of the calendar year. This makes your monthly expenses more consistent and manageable.
It is important to note that the Medicare Prescription Payment Plan is not the same as "Extra Help", which is a program for people with limited incomes and resources to pay for Part D premiums, deductibles, and other costs. Additionally, there are other programs that can help lower your drug costs, such as Medicaid and State Pharmaceutical Assistance Programs (SPAPs). These programs have different eligibility requirements, so it is important to check if you qualify.
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Extra Help for low-income earners
Medicare's Extra Help program assists individuals with limited incomes and resources in covering the costs of their Medicare prescription drug coverage (Part D). This includes premiums, deductibles, coinsurance, and other expenses. The program is not available in Puerto Rico, the U.S. Virgin Islands, Guam, the Northern Mariana Islands, or American Samoa, but other programs are available in these areas to assist those with limited incomes and resources.
To qualify for Extra Help, your income and resources must be below certain limits, which may change annually. For 2025, the monthly income limit is $1,976 for individuals and $2,664 for couples, while assets, such as savings, stocks, and real estate, must also be below specified limits. Even if your income or assets exceed these thresholds, you may still qualify as certain types of income and assets are not counted.
If you are enrolled in Medicaid, you may automatically qualify for Extra Help. Additionally, if you are under 65, have a disabling impairment, and continue to work, you may be eligible for the Qualified Disabled Working Individual (QDWI) program, which provides automatic qualification for Extra Help regardless of the standard eligibility requirements.
You can apply for Extra Help at any time before or after enrolling in Medicare Part D. If you are eligible, you will receive a letter informing you of your new Medicare drug plan (if you don't already have one) and the amount you will be required to pay.
To further reduce prescription drug costs, you can explore Pharmaceutical Assistance Programs (PAPs) offered by pharmaceutical companies or State Pharmaceutical Assistance Programs (SPAPs) that provide coverage for drug plan premiums and/or cost-sharing. Additionally, you can ask your doctor about generic or cheaper brand-name drug alternatives, compare costs for mail-order pharmacies, and consider the Medicare Prescription Payment Plan to spread out your out-of-pocket expenses throughout the year.
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Pharmaceutical Assistance Programs
Medicare beneficiaries can benefit from Pharmaceutical Assistance Programs (PAPs) to help pay for their medications. PAPs are sometimes called Patient Assistance Programs and are offered by some pharmaceutical companies to help cover the costs of medications for people enrolled in Medicare drug coverage (Part D).
Each PAP has different eligibility requirements, so it is important to contact the company directly to find out if you qualify for assistance. Pharmaceutical manufacturers may sponsor PAPs that provide financial assistance or free drug products to low-income individuals to supplement their existing prescription drug coverage. These programs can assist Part D enrollees by operating "outside the Part D benefit", ensuring that the assistance does not count towards a beneficiary's true out-of-pocket cost (TrOOP).
State Pharmaceutical Assistance Programs (SPAPs) are also available in certain states and territories, providing additional support to help pay for drug plan premiums and/or cost-sharing. Eligibility for SPAPs depends on the specific rules of each program. Medicare beneficiaries can also explore other options such as Medicaid, which is a joint federal and state program for individuals with limited income and resources, or "Extra Help", a program that assists with Part D premiums, deductibles, and other costs for those with limited income and resources.
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Medicare's Limited Income Newly Eligible Transition (LI NET)
To be eligible for Extra Help, you must have limited income and resources. Each state has different income and resource requirements to determine eligibility. If you are eligible for Extra Help, Medicare may automatically enrol you in a Part D plan and notify you of your coverage. You can also apply for Extra Help if you don't receive it automatically. If you filled and paid for any prescriptions during the retroactive period before your Extra Help coverage began, you may be able to get reimbursed through LI NET by submitting drug claim forms.
To lower your prescription drug costs, you can also explore other options such as Pharmaceutical Assistance Programs (PAPs), where some pharmaceutical companies help pay for medications for people enrolled in Medicare drug coverage (Part D). Each company has different eligibility requirements for their PAPs, so it's important to contact them directly to find out if you qualify. Additionally, you can check if the company that makes your drug offers help with payment or if your state provides assistance with drug costs.
It's important to note that Extra Help is not available in Puerto Rico, the U.S. Virgin Islands, Guam, the Northern Mariana Islands, or American Samoa. However, there are other programs available in those areas to assist individuals with limited income and resources. You can contact your local State Health Insurance Assistance Program (SHIP) to learn more about the available programs and apply for Extra Help simultaneously.
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Frequently asked questions
Medicare drug insurance, also known as Medicare Part D, is a prescription drug benefit available to all beneficiaries enrolled in Medicare. It helps keep drug costs manageable as one ages.
Wellcare has been rated as the company to beat in 2025 when it comes to price and quality. It offers $0 premiums and outperforms competitors on government quality ratings. However, the best plan for you will depend on your budget, ability to meet the deductible, number of prescriptions you need, and where your prescriptions fit into a plan's formulary tiers and pricing.
The Medicare Prescription Payment Plan is a new payment option that works with your current Medicare drug coverage to help you manage your out-of-pocket costs for drugs covered by your plan by spreading them across the calendar year (January–December). This payment option might help you manage your monthly expenses, but it won’t save you money or lower your drug costs.
The Part D late enrollment penalty is an amount that’s permanently added to your Medicare drug coverage premium if you go 63 or more days in a row without Medicare drug coverage or other creditable prescription drug coverage after your Initial Enrollment Period ends. The penalty amount is calculated by multiplying 1% of the "national base beneficiary premium" by the number of full, uncovered months you were eligible for Medicare drug coverage but didn’t have it.
Yes, there are several programs that can help with Medicare drug costs. These include:
- Medicaid: A joint federal and state program that helps cover medical costs for people with limited income and resources.
- Medicare’s Limited Income Newly Eligible Transition (LI NET) Program: Provides temporary Medicare Part D drug coverage to people who qualify for Extra Help but are not yet enrolled in a Medicare drug plan.
- Extra Help: A program that assists individuals with limited income and resources in paying Part D premiums, deductibles, coinsurance, and other expenses.
- Pharmaceutical Assistance Programs (PAPs): Offered by some pharmaceutical companies to help pay for medications for people enrolled in Medicare drug coverage (Part D).
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