Here is important information you need to know about owning a prescription drug plan:

• Annual Deductible — There is a deductible you must pay for a Part D plan. Your deductible may be different, or waived entirely, but the max amount you can be charged is $545 in 2024. You will pay a discounted price for your medications until you have satisfied the deductible. After that, you begin initial coverage.

• Initial Coverage — During initial coverage, you pay a copay for your medications based on your plan’s formulary. Each prescription drug plan separates it's medications into tiers. Each tier has a copay amount for which you are responsible. It is typically separated by generic drugs, preferred name brands, even more specialized medications, and etc. In 2024, the initial coverage cap is $5030. After you and the insurance company together have paid this amount, then you enter the coverage gap.

• The Coverage Gap – During the coverage gap, you will still generally have significant discounts for generic medications. Typically, you will pay 25% for name brand medications and 25% for generics. Your gap spending will continue until you have paid $8000 out of your own pocket in 2024.

• Catastrophic Coverage – Once you get out of the coverage gap (Medicare prescription drug coverage), you automatically get "catastrophic coverage." It assures you only pay a small coinsurance percentage or copayment for covered drugs for the rest of the year.