What is a deductible and how does it work in a Part D plan?

Updated on: October 26, 2018

Originally posted on: September 17, 2014

A deductible is similar to other types of insurance that require a deductible. For example, following an accident, your car needs $2,000 worth of repair. Your auto insurance policy has a $500 deductible. This means you pay the first $500 out of your pocket, and your insurance pays the rest ($1,500). In a Medicare Part D plan, the deductible is the amount you are required to spend for your medication before your plan begins to pay. So, if the plan you choose has a $50 deductible and your first prescription costs $75, you will pay $50 and the plan will pay $25.

If your dedcuctible is a higher amount, you will pay the full cost of your medications until you meet the deductible amount. Once you’ve met the deductible, you will be responsible only for the copayment or coinsurance required on future prescriptions. Not all Part D plans have a deductible. Learn more about Medicare plan costs here.