What is Medicare Part D for 2024?

What is Medicare Part D for 2019?

Medicare Part D Plan is used either as a stand-alone plan (Original Medicare with or without Medicare Supplement also known as Medigap) or as a part of Medicare Advantage with Prescription Drugs (MAPD). There are multiple Medicare Part D Plans based on the Standard Benefit Plan. The Standard Benefit Plan is the prescription drug plan offering minimum allowable benefits.

Highlights of Medicare Part D – 2024

There are four coverage phases (stages) in the Medicare Part D Plan, also known as the Medicare Prescription Drug Plan or PDP. The PDP stages parameters will be changed in 2024. The updated numbers are provided below. For your convenience, the 2023 numbers are also provided.

1. Yearly Deductible

You pay the first $545 drug costs before the plan starts to pay ($505 in 2023).

2. Initial Coverage

For each covered drug you pay a copayment/coinsurance defined by the plan, and the plan pays its share. The typical coinsurance is 25%, which means you pay 25% of the drug costs; the insurance company pays the rest. The initial coverage continues until the total drug costs (total of what you’ve paid and what the insurance company paid) reach $5,030 ($4,660 in 2023). You pay 25% of costs between $545 and $5,030 (between $505 and $4,660 in 2023).

3. Coverage Gap

Once the total costs of prescriptions paid by you and your plan have reached $5,030 ($4,660 in 2023), you will pay ALL drug costs until you’ve spent $8,000 true out-of-pocket costs (TrOOP) ($7,400 in 2023). This does not include monthly premiums (you must continue to pay them) but does include yearly deductible and coinsurance/copayments.

In 2024, during the Gap period, you’ll pay for 25.0% of brand name drug undiscounted costs (25.0% in 2023) and 25% of generic drug costs (25% in 2023). Nevertheless, you can count the full price of the prescription towards the amount you are required to spend to qualify for catastrophic coverage.

4. Catastrophic Coverage

Once you’ve spent $8,000 out-of-pocket during the year for PDP ($7,400 in 2023), the coverage gap ends, and catastrophic coverage begins. Beneficiary cost-sharing in the Catastrophic Coverage stage of the Medicare Part D coverage will be eliminated starting January 1st, 2024. You will pay nothing.

Note. The dollar amounts above represent the MAXIMUM of allowed. Some plans may have numbers below the maximum.

Medicare Part D Enrollment

Read Medicare Enrollment Periods for Medicare Part D.

US Government Sources

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