Medicare Part D is a voluntary outpatient prescription drug benefit for people with Medicare, provided through private plans approved by the federal government. Beneficiaries can choose to enroll in either a stand-alone prescription drug plan (PDP) to supplement traditional Medicare or a Medicare Advantage prescription drug plan (MA-PD), mainly HMOs and PPOs, that cover all Medicare benefits including drugs. In 2020, 46 million of the more than 60 million people covered by Medicare are enrolled in Part D plans.

Medicare offers two ways to get prescription drug coverage—Part D and Medicare Advantage. Medicare Part D is one component of the overall Medicare program, which is a national health insurance program.

While Medicare extends to a wide variety of medical treatments, Part D is focused specifically on making drug prices more affordable for Americans 65 years and older.

People already covered by Medicare generally can opt in to Medicare Part D. If you do, you will be charged the same kinds of costs found with standard insurance plans, such as monthly premiums, annual deductibles, and various copays. In exchange, you get additional coverage for prescription drugs as compared to what is already offered by the broader Medicare program. For this reason, it’s up to you to choose whether subscribing to Medicare Part D makes economic sense, given your health needs and financial circumstances.