Prescription drug prices remain one of the biggest concerns for people on Medicare. Even with coverage through Medicare Part D, the cost of medications can add up quickly—especially for those with chronic conditions or multiple prescriptions.
But 2025 brings some significant changes, along with proven strategies, that can help reduce what you spend out of pocket. Whether you’re new to Medicare or looking to optimize your current plan, knowing how to navigate Part D, use assistance programs, and make smart choices at the pharmacy can lead to real savings.
Here’s how to lower your Medicare drug costs this year—without sacrificing the medications you need.
Understand What Changed in 2025
The biggest shift for 2025 comes from the ongoing rollout of the Inflation Reduction Act, which is gradually transforming how Medicare handles prescription drug pricing.
Two key updates for 2025:
A new annual $2,000 out-of-pocket cap on prescription drug costs under Medicare Part D
More protection in the “catastrophic” phase of coverage, meaning once you hit that $2,000 mark, you’ll pay nothing out of pocket for the rest of the year
This cap replaces the old system, where some beneficiaries spent thousands per year in the catastrophic coverage phase after their initial coverage limit was exhausted. It’s a major win for retirees on expensive medications—but even with the cap, staying under $2,000 is still a goal worth aiming for.
Tip 1: Choose the Right Part D Plan for Your Medications
Not all Medicare drug plans are created equal. Even if two plans have similar premiums, they may cover your medications differently—or place them in different pricing tiers.
When comparing plans during open enrollment (or if you qualify for a special enrollment period), always look at:
The plan’s formulary (its list of covered drugs)
The tier your medications fall into (lower tiers typically cost less)
The pharmacy network (some plans offer lower prices at preferred pharmacies)
Use the Medicare Plan Finder to enter your specific prescriptions and see side-by-side comparisons. Don’t just pick the plan with the lowest premium—choose the one with the best total cost based on your actual meds.
If your prescriptions have changed since last year, it’s worth re-evaluating your plan.
Tip 2: Use Preferred or Mail-Order Pharmacies
Many Medicare Part D plans offer lower copays or coinsurance when you use a preferred pharmacy within their network. These might include major retail chains or regional partners. Always confirm that your pharmacy is considered “preferred”—not just “in-network.”
Some plans also offer discounts for using mail-order pharmacies, especially for 90-day supplies of maintenance medications. Mail-order can be more convenient and cost-effective, especially for people with mobility or transportation issues.
Before filling a prescription, ask your plan if there’s a cheaper option at a different pharmacy.
Tip 3: Apply for the Extra Help Program
If you’re on a limited income, the Extra Help program (also called the Low-Income Subsidy or LIS) can significantly reduce your prescription drug costs—even if you’re already enrolled in a Part D plan.
Extra Help provides:
Lower monthly premiums (often eliminating them entirely)
Reduced or no annual deductible
Copays as low as $0 to $11.20 for covered medications in 2025
Many people qualify for Extra Help but don’t realize it. You may be eligible if your income and assets are below certain thresholds (which change yearly). You can apply through the Social Security Administration or be auto-enrolled if you already receive Medicaid or a Medicare Savings Program.
Even if you don’t qualify now, changes in income or spending could make you eligible in the future.
Tip 4: Talk to Your Doctor About Lower-Cost Alternatives
Doctors often prescribe brand-name drugs without realizing that the cost to you might be substantially higher than a generic or preferred alternative. If you’re facing high out-of-pocket costs, it’s worth having a conversation.
Ask your doctor:
Is there a generic version of this drug?
Is there a similar drug in a lower tier on my Part D plan?
Would a 90-day supply reduce costs?
In many cases, switching medications within the same class can dramatically reduce what you pay at the pharmacy—without compromising your health.
Tip 5: Appeal Denials or Request Tiering Exceptions
If your Part D plan doesn’t cover a medication you need, or if it places it in a high-cost tier, you’re not stuck.
You can:
File an appeal if coverage was denied and your doctor believes the medication is medically necessary
Request a tiering exception if your doctor can show that lower-cost drugs won’t work for you
These options don’t guarantee approval, but many beneficiaries have success—especially when supported by clear medical documentation.
Don’t be afraid to advocate for yourself. Your pharmacist or doctor’s office may even help file the request.
Tip 6: Use Discount Cards or Coupons—With Caution
Programs like GoodRx, SingleCare, or manufacturer copay cards can sometimes offer lower prices than your Medicare Part D plan. However, you can’t use these discounts with your Part D coverage—they’re an either/or situation.
If the cash price with a discount card is lower than your plan’s copay, you can pay out of pocket—but be aware that it won’t count toward your $2,000 out-of-pocket cap or deductible.
Still, for drugs not covered by your plan, or for short-term prescriptions, these cards can offer meaningful savings. Just keep track of what’s paid through your plan and what’s not.
Tip 7: Use State Pharmaceutical Assistance Programs (SPAPs)
Many states offer their own prescription assistance programs for Medicare beneficiaries, especially those with moderate income who don’t qualify for Extra Help.
These programs may:
Help cover premiums, deductibles, or copays
Offer discounts for certain high-cost drugs
Provide support for people with chronic conditions like cancer or HIV
Eligibility and benefits vary by state, so check with your state’s health department or aging services office to learn more.
Tip 8: Stay on Top of Formulary Changes Each Year
Every fall, Part D plans update their formularies for the coming year. This means a drug that was covered—or affordable—this year could move to a higher tier or be dropped entirely.
That’s why reviewing your plan during open enrollment (Oct. 15 – Dec. 7) is essential. Even if your premium stays the same, your total costs may not.
Take time to:
Check if your prescriptions are still covered
Compare the total annual cost (not just monthly premiums)
See if new plans in your area offer better value
Don’t assume that staying with your current plan is the best deal year to year.
Final Thought
Medicare drug costs can be a major burden—but you’re not powerless. From choosing the right plan to applying for financial help and working with your doctor, there are multiple ways to reduce your out-of-pocket expenses in 2025.
The key is being proactive. Don’t wait until a refill surprises you at the pharmacy. Take time to understand your options, review your plan annually, and use every tool available to cut costs while keeping your health on track.
Because when it comes to Medicare, smart planning doesn’t just save money—it ensures you get the medications you need, when you need them.
