Best Medicare Part D Prescription Drug Plans Of 2025 (2025)

To determine the best Medicare Part D providers, the Forbes Advisor editorial team evaluated all insurance companies that offer plans nationwide in terms of:

• How many states in which they provide coverage
• The number of prescription drug plans they offer
• Whether they offer $0 premiums with full low-income subsidies
• The average monthly drug premium across all plans they offer
• The average annual deductible across all plans they offer
• Whether they offer additional coverage in the coverage gap
• How the CMS ranks their drug plans, using an average to represent the company as a whole
• How A.M. Best ranked them in terms of their financial health (which affects how reliable an insurer is when it comes to paying claims)

Analysis focused exclusively on providing general summaries of the companies and their reputations. In order to provide specific plan recommendations accurately, it’s important to consider the ZIP code and demographic details of the individual seeking insurance coverage. To do so, we recommend using Medicare.gov’s plan finder tool or seeking the expertise of a licensed, independent, agnostic insurance agent.

Medicare Part D is an optional prescription drug benefit available to every U.S. resident enrolled in Medicare. These plans allow for additional coverage alongside Original Medicare (Medicare Part A and Part B), Original Medicare paired with a Medicare Supplement plan or a Medicare Advantage plan that doesn’t include drug coverage.

Offered by a host of private insurance providers, Part D plans make it easier to afford prescription drugs. Each Part D plan features a unique drug formulary, a list of drugs it covers and to what extent that coverage manages costs for the beneficiary. Monthly premiums for Part D plans vary based on the insurance provider and the geographic location in which the plan is offered.

How Does Medicare Part D Work?

Each Medicare Part D plan follows the stages listed below, per the federal government.

Stage 1: Deductible
A beneficiary must first pay the full cost of their medications until they meet their plan’s deductible. Some plans offer coverage for certain medications during this stage.

Stage 2: Initial Coverage
Once the deductible is reached, the plan’s initial coverage stage kicks in. Copayment and coinsurance rates vary per plan, but the plan covers remaining expenses.

Stage 3: Coverage Gap
If the total amount a beneficiary and their plan pay for prescription drugs reaches $5,030 in 2024, they enter the coverage gap. Also known as the “donut hole,” the coverage gap occurs when there’s a temporary limit on what the plan covers for drugs, requiring the beneficiary to pay up to 25% of the retail cost of any brand-name medications covered in their plan.

Stage 4: Catastrophic
If a beneficiary spends $8,000 out of pocket in 2024, they leave the coverage gap and access what’s called “catastrophic coverage.” For the remainder of the year, they’re only responsible for paying a small coinsurance percentage or copayment for their drugs.

Are All Medicare Part D Plans the Same?

While all Medicare Part D plans are provided by private insurance companies, the plans themselves vary significantly in terms of their costs and the drugs they cover. Each Part D plan features its own drug formulary, costs of drugs for which the beneficiary is ultimately responsible, monthly premium and annual deductible. For this reason, it’s important for anyone interested in Medicare Part D coverage to review each of their plan options very carefully to make sure they pick one that offers the drugs they need (or are likely to need in the future) at rates that work for their budget.

The Department of Health and Human Services requires that all Medicare Part D plans cover six protected classes of drugs, which include:

• Anticonvulsants. These drugs are commonly used to treat epileptic seizures.
• Antidepressants. These medications help treat depression, some anxiety disorders and some chronic pain conditions, as well as substance use disorders.
• Antineoplastics. These drugs are used to treat cancer.
• Antipsychotics. These medications help treat bipolar disorder, schizophrenia and other mental illnesses.
• Antiretrovirals. These drugs treat human immunodeficiency virus (HIV).
• Immunosuppressants. These medications treat a variety of conditions, such as rheumatoid arthritis and Crohn’s disease, as well as prevent organ rejection in transplant patients.

For beneficiaries with diabetes, Medicare Part D covers insulin that isn’t administered with an insulin pump, as well as anti-diabetic drugs and certain diabetes supplies. Beneficiaries who participate in the Part D Senior Savings Model can access multiple types of insulin for a maximum copayment of $35 for a month’s supply. However, the $35 maximum doesn’t apply if a beneficiary reaches the catastrophic stage of their drug coverage.

Generally, every Medicare Part D plan comes with a drug formulary, a list of specific medications (and doses of those medications) that are covered. Insurance providers maintain the right to add or remove approved medications and change these formularies annually.

“The most significant changes for formularies—as well as premiums and copays—are seen each new calendar year,” says Amanda Reese, Medicare department manager at Hafetz and Associates in Linwood, New Jersey. “That’s why it’s imperative that you review your Part D plan yearly, especially if your medications have changed.”

If there’s a medication one needs that isn’t listed on their Part D plan’s formulary, they can file for a formulary exception. To do so, their health care provider must call their insurance provider and explain the beneficiary’s need for that specific medication. Upon approval, the plan may cover the medication until the evaluation for the following calendar year begins.

Consider the benefits and drawbacks of Medicare Part D plans below.

Pros:

• Protects beneficiaries from paying for prescription drugs entirely out of pocket
• Can help prevent individuals from surprise costs should they need additional prescription drugs in the future
• Can feature $0 monthly premiums depending on the plan and provider

Cons:

• Drug formularies can be daunting and confusing to navigate
• Drug formularies change every year, so beneficiaries must check their plan details annually to ensure it still covers the drugs they need
• Can add another monthly premium to one’s health insurance expenses
• Doesn’t necessarily make every tier of drugs more affordable

“Part D plans have a wide range of costs, including a [monthly] premium,” says Christopher Duncan, a retirement income certified professional at Trusted Benefits Direct in Las Vegas. “The premiums for various Part D plans run from a little less than $10 a month to upwards of $150 a month,” he adds.

Based on data provided by CMS, Clear Spring Health offers the lowest average monthly premium price of $24.20 across its Part D plans. Meanwhile, Highmark Inc. Part D plans tend to have the most expensive monthly premiums, with an average of $156.85 across its plans.

In terms of annual deductibles, Avalon Insurance Company offers the lowest average price of $157.50 per year across its plans while Mutual of Omaha and Clear Spring Health rank as the most expensive, with an average price of $505 across their plans [3].

Monthly premiums and annual deductibles aside, spending largely depends on the specifics of a plan’s drug formulary and what drugs the beneficiary needs. It’s crucial to review drug formularies thoroughly before purchasing a Part D plan to ensure that the plan selected provides the necessary coverage to minimize spending as much as possible.

“Securing the lowest premium doesn’t mean you’re getting the best deal,” says Duncan. “You may choose a $10-a-month plan only to learn your prescription will cost $100 to fill at the pharmacy when you could have purchased a $40-a-month plan and received the prescription for only a $10 copay.”

How to Save Money on Part D Plans

To save money on a Medicare Part D plan, it’s important to consider its annual deductible, monthly premium and drug formulary and how each balances in providing useful coverage for an individual.

For instance, a Part D plan with a very affordable annual deductible and monthly premium but a drug formulary that doesn’t cover the drugs the person needs could end up costing a significant amount out of pocket. While a $0 monthly premium might look attractive on the surface, it could mean other compromises in coverage and therefore additional costs down the line.

Conversely, even if a drug formulary perfectly fits the needs of an individual, an expensive monthly premium and/or high annual deductible could mean upfront costs put too much of a strain on one’s budget.

The best way to save money on a Part D plan is to research and select a plan that covers the drugs one needs with a monthly premium that fits into their budget and an affordable annual deductible.

At some point, Medicare Part D beneficiaries may face a coverage gap called the “donut hole,”which is a temporary limit on what their Part D plan pays for their drugs for a specified period of time.

In 2024 the coverage gap begins when the total amount a beneficiary and their plan pay for prescription drugs reaches $5,030. Unfortunately, once one lands in the Medicare donut hole, the primary way out is through. The beneficiary is responsible for paying up to 25% of the retail cost of their medications either until the year ends and their coverage resets or they accumulate a total out-of-pocket spending of $8,000.

The best way a beneficiary can avoid the Medicare donut hole is to enroll in the best plan for their unique needs at the very best price, which is why it’s so important to consider a drug plan’s details—including its monthly premium, annual deductible and specific drug formulary—prior to enrollment.

There are several ways to enroll in a Medicare Part D plan, including visiting Medicare.gov to enroll directly on the website. An individual can also call the private insurance company they choose to work with or enroll using the company’s website. Medicare agents can also handle the enrollment process for clients.

Once a person selects their plan and picks one of the enrollment paths above, benefits of that plan typically take effect on the first day of the month following their enrollment.

Anyone looking for Medicare prescription drug coverage should visit Medicare.gov and use its plan finder tool to review all available Medicare Part D plans. Once a customer enters their ZIP code, they can review the list of plans offered in their area by a range of providers, including each plan’s monthly premium, annual deductible and specific drug formulary details.

With that said, this list of options can often feel overwhelming. Many Medicare beneficiaries prefer to work with an expert who can help them more easily digest how each plan works to determine which one best suits their needs based on the medications they take now, their risk of developing future conditions, their preferred pharmacy, their budget and more.

When Can You Change Medicare Part D Plans?

Anyone already enrolled in a Medicare Part D plan who’s considering switching plans can do so during Medicare’s annual open enrollment period, which runs from October 15 to December 7.

Individuals enrolled in a Medicare Advantage plan specifically can make changes to their Part D enrollment during the annual Medicare Advantage open enrollment period, which runs from January 1 to March 31. However, they must switch Medicare Advantage plans or drop Medicare Advantage coverage to return to Original Medicare in order to change their Part D plan selection during this time.

In general, Medicare Part D serves as a supplement to other forms of health coverage and cannot overlap with existing drug coverage. “By law, you can only have one Medicare Part D plan,” explains Duncan. “If you’re retired and your company offers a Part D plan, you can be enrolled in it. [But] if you elect another Part D plan, that [enrollment] will automatically disenroll you from the other Part D plan,” says Duncan.

Meanwhile, it’s possible to have coverage from the Department of Veterans Affairs (VA) and an additional Part D plan. While one would get most of their prescriptions at the best prices through the VA, they might choose to purchase an additional Part D plan to fill any gaps, as VA drug coverage doesn’t apply to all prescriptions.

Forbes Health lead editor Jessica Lester contributed to this article.

Footnotes

• Prescription Drugs.Georgetown University Health Policy Institute. Accessed 8/17/2023.
• Key Facts About Medicare Part D Enrollment and Costs in 2022.KFF. Accessed 9/1/2023.
• Prescription Drug Coverage – General Information. Centers for Medicaid and Medicare Services. Accessed 8/17/2023.

References

• How to get prescription drug coverage.Medicare.gov. Accessed 8/17/2023.
• Yearly deductible for drug plans.Medicare.gov. Accessed 8/17/2023.
• Copayment/coinsurance in drug plans.Medicare.gov. Accessed 8/17/2023.
• Costs in the coverage gap.Medicare.gov. Accessed 10/26/2023.
• Catastrophic coverage.Medicare.gov. Accessed 10/26/2023.
• Medicare Coverage of Diabetes Supplies, Services and Prevention Programs.Medicare.gov. Accessed 8/17/2023.
• How to switch your Medicare drug plan.Medicare.gov. Accessed 11/6/2023.
• Joining a plan.Medicare.gov. Accessed 11/6/2023.
• Yearly deductible for drug plans.Medicare.gov. Accessed 11/6/2023.