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Nerdy takeaways
- A formulary is a list of the drugs your Medicare Part D plan covers.
- Most formularies are organized into tiers. Lower tiers usually include less expensive drugs, while pricier drugs go on higher tiers.
- The formulary tier can determine your copay, coinsurance and/or deductible.
Medicare Part D prescription drug plans and Medicare Advantage plans with prescription drug coverage each have a formulary that lists whether and how the plan covers medications. You can review the formulary to confirm that your drugs are covered and what you’ll owe when filling your prescriptions.
Here’s what you should know about Medicare Part D formularies.
Do all Medicare Part D plans have the same formulary?
No. Each Medicare Part D plan and Medicare Advantage plan with prescription drug coverage has its own formulary, and they can differ significantly. The formulary tells you whether and how your drugs are covered, so it’s important to review a plan’s formulary before you enroll.
What are formulary tiers?
Medicare Part D plans organize the drugs on their formularies into tiers. Each tier has different out-of-pocket cost requirements. Many plans have five formulary tiers, but some might have more or fewer.
Drugs on low tiers have lower or even zero cost-sharing requirements, while drugs on higher tiers will generally cost you more out of pocket. Your plan won’t help at all with the cost of drugs that aren’t on the formulary.
However, if you or your health care provider believe that you need a specific drug that’s not included on your plan’s formulary, you can apply for a special exception. The insurance company might grant the exception if your prescriber can demonstrate that the drug is medically necessary because the alternatives included on the formulary would be less effective or would have adverse effects.
Here’s a hypothetical example of Medicare Part D formulary tiers:
| Drug tier | Description |
|---|---|
| Tier 1: Preferred generic drugs | The least expensive generic prescription drugs. This tier may have $0 or minimal-cost copays. |
| Tier 2: Non-preferred generic drugs | Most generic drugs. This tier usually has relatively low copays. |
| Tier 3: Preferred brand-name drugs | Less expensive brand-name drugs. This sometimes also includes costlier generic drugs. This tier may have higher copays or a coinsurance requirement. |
| Tier 4: Non-preferred drugs | More expensive brand-name drugs. This tier typically has a fairly high coinsurance requirement. |
| Tier 5: Specialty tier | Drugs that meet a government-defined threshold for the monthly cost of their ingredients. By law, plans can require up to a 33% coinsurance for this tier. The coinsurance is capped at 25% for plans with the maximum Part D deductible of $615 in 2026. |
» If you have concerns about affording Medicare Part D, look into Medicare Extra Help
Compare Medicare Part D Plans
| Insurance company | NerdWallet rating | Out-of-pocket costs | Member experience |
|---|---|---|---|
| Lower than average | 3 (Average) | ||
| Varies | 3.5 (Above average) | ||
| Average | 2 (Below average) | ||
| Average | 2.29 (Below average) |
What drugs need to be included in a Medicare Part D formulary?
The Centers for Medicare & Medicaid Services (CMS) evaluates and approves Medicare Part D plans’ formularies. Plans generally don’t need to cover specific drugs, but each plan must meet CMS’ standards to demonstrate that it “provides access to an acceptable range of Part D drug choices”.
Plans must include drug categories and classes that cover a certain set of medical conditions. And plans must cover at least two drugs per category or class, if possible. The two drugs have to be “chemically distinct” — not just two versions of the same medication.
For example, a plan that covers Lipitor to treat high cholesterol wouldn’t meet the requirement by covering Atorvastatin, the generic version. However, it could meet the requirement by covering Simvastatin, a generic version of a different cholesterol drug.
In addition, Medicare prescription drug plans must include “substantially all” drugs in six protected classes of medications:
- Immunosuppressant.
- Antidepressant.
- Antipsychotic.
- Anticonvulsant.
- Antiretroviral.
- Antineoplastic.
“Substantially all” means that all drugs and unique dosage forms in the category must be covered, but there are some exceptions. For example, plans aren’t required to cover both extended-release and immediate-release versions of a drug or multiple brand names of molecularly identical drugs.
How do I find if a Medicare Part D formulary covers my drugs?
Your plan must provide a copy of your formulary and cost-sharing requirements after you enroll and before Medicare open enrollment starts on Oct. 15 of each year afterward.
The disclosure materials from your plan can tell you what drugs are covered and how cost-sharing works, but they’re not always the most readable. Fortunately, you can also use some more approachable interactive tools to check what’s covered while you’re shopping for a plan.
You can enter information about your drugs and the pharmacies you use at medicare.gov/plan-compare to compare Medicare Part D plans' cost, coverage and star ratings for the options available in your area.
Many insurance companies’ websites also include tools that show how their plans will cover your drugs and pharmacies.
Shopping for Medicare Part D plans? We have you covered.
| MEDICARE PART D covers outpatient prescription drugs for people on Medicare. Compare options from our Medicare Part D roundup. | |
| Best for low premiums | Best for low out-of-pocket costs |
| Best for generic drugs | Best for low deductibles |
Can my Medicare Part D formulary change?
Yes, your Part D plan can change its formulary, but there are rules for when and how. Changes could include changing a drug’s tier or cost-sharing requirements or dropping a drug entirely.
Formulary changes with written notice in advance
For most formulary changes that affect a drug you’re taking during the year, your plan must do at least one of these two options:
- Provide written notice at least 30 days before the effective date.
- Provide written notice when you request a refill, plus at least a one-month supply of the drug under whatever rules applied before the change.
The written notice needs to include:
- The name of the drug.
- What’s changing: Is the drug being dropped or moving to a different tier?
- Why the change is happening.
- Options for alternative drugs in the same category, class or cost-sharing tier, with cost-sharing information.
- How to request a coverage determination or exception to the change.
Formulary changes that can happen right away
Under certain circumstances, Part D plans can immediately change the formulary status of certain drugs without providing notice in advance. You’ll still get written notice, but it may be after the fact.
For example, plans can immediately drop a drug that’s no longer offered by the manufacturer or that the Food and Drug Administration considers unsafe.
Plans can also drop or change tiers for a covered brand-name drug if they add a newly available generic drug in its place with equal or lower cost-sharing requirements.
If you have additional questions about Medicare, visit Medicare.gov or call 800-MEDICARE (800-633-4227, TTY 877-486-2048).
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- 1. Medicare Prescription Drug Benefit Manual, Chapter 6. Section 30.2.1 — Formulary Categories and Classes. Accessed Feb 23, 2026.
- 2. Medicare Prescription Drug Benefit Manual, Chapter 6. Section 30.2.5 — Protected Classes. Accessed Feb 23, 2026.
- 3. Code of Federal Regulations. Title 42, Part 423, Section 128. Accessed Feb 23, 2026.
- 4. Centers for Medicare & Medicaid Services. Your Guide to Medicare Drug Coverage. Accessed Feb 23, 2026.
- 5. Code of Federal Regulations. Title 42, Part 423, Section 120. Accessed Feb 23, 2026.
