Making Sense of the 2026 Medicare Prescription Drug Changes

Every year from October 15 through December 7, you have the opportunity—and should take the time—to review your prescription drug coverage. Why? Because changes are made every year by Medicare, medication manufacturers, and insurance companies. Premiums, formularies, and pharmacy networks can all change.

For 2026, several insurance companies chose not to pay commissions to agents. This means many agents were forced to work without compensation or direct clients back to the insurance companies themselves. While this may change in 2027, Holmes Harbor Insurance continues to assist you in finding the coverage that best fits your situation at no cost to you.

Keep in mind: insurance companies prefer that members contact them directly for coverage questions—but we are still here to help you understand your options and make informed decisions.

Prescription Drug Coverage

Prescription drug coverage in the U.S. is primarily provided through:

·       Medicare Part D for those on Medicare

·       Employer-based plans

·       State-specific programs for eligible individuals

These plans help reduce medication costs through formularies (lists of covered drugs), copayments, and often include mail-order or network pharmacy options.

PDP – Prescription Drug Plans

PDPs (Prescription Drug Plans) are Medicare-approved, private insurance plans that add Part D drug coverage to Original Medicare. They cover both generic and brand-name medications.

For 2026, plans include:

·       A $2,100 maximum out-of-pocket limit for covered medications

·       Varying premiums, deductibles, and tiered copayments

·       Possible penalties for late enrollment

Medicare Part D

Medicare Part D is an optional, privately administered federal program that has been in place since 2006. It helps beneficiaries pay for prescription drugs and is available to anyone enrolled in Medicare Part A or Part B.

Coverage is offered through:

·       Stand-alone Prescription Drug Plans (PDPs), or

·       Medicare Advantage plans that include drug coverage

Late Enrollment Penalty

If you go 63 days or more without creditable prescription drug coverage after your initial enrollment period, Medicare will add a permanent monthly penalty to your Part D premium.

·       The penalty equals 1% of the national base beneficiary premium for each month you were uncovered

·       In 2026, the base premium is $38.99

·       The penalty is rounded to the nearest $0.10 and lasts for the rest of your life

The Bottom Line

Whether it’s called Part D, PDP, or a Prescription Drug Plan, it is the same type of coverage. Many plans have $0 premiums, and your maximum out-of-pocket cost for covered medications in 2026 is $2,100.

If you decline prescription drug coverage for more than 63 days, Medicare will apply a penalty that stays with you permanently.

When you turn 65, you have:

·       3 months before,

·       the month of, and

·       3 months after your birthday month

to enroll in Medicare Part A & B and select prescription drug coverage if you are losing creditable coverage. We can help you with this process at no charge.

John Potter

Holmes Harbor Insurance

📞 425-381-2901

📧 John@holmesharborinsurance.co

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