Part D Savings: How to Cut Prescription Costs with Medicare Drug Plans

When you’re on Medicare Part D, a federal program that helps pay for prescription drugs. Also known as Medicare drug coverage, it’s designed to lower what you pay out of pocket for medications. But many people don’t realize how much they’re overpaying—even with coverage. The difference between paying full price and maximizing your Part D savings can be hundreds, sometimes thousands, of dollars a year. It’s not about having coverage; it’s about using it right.

One of the biggest levers for Part D savings is generic drugs, lower-cost versions of brand-name medications that work the same way. Also known as brand equivalents, they’re often 80% cheaper. But here’s the catch: your plan’s formulary decides which generics are covered and at what tier. If your pill isn’t on the preferred list, you’ll pay more. That’s why comparing plans every year matters. A plan that covers your meds at Tier 1 (lowest cost) in January might move them to Tier 3 by July. And if your pharmacy isn’t in-network, you could pay double. Medicare formularies, the lists of drugs your plan covers and how much you pay for each. Also known as drug lists, they’re not standardized across insurers. One plan might cover lisinopril with a $5 copay; another might require you to try three other drugs first.

Then there’s the hidden layer: pharmacy benefit managers, middlemen who negotiate drug prices between insurers and pharmacies. Also known as PBMs, they control which drugs get covered and at what price. They’re the reason two people on the same plan pay different amounts for the same pill. One might get a $10 copay because their pharmacy has a deal with the PBM; the other pays $45 because their pharmacy doesn’t. And gag clauses? Those prevent pharmacists from telling you that paying cash could be cheaper than using your insurance. That’s not a glitch—it’s the system.

Part D savings aren’t about luck. They’re about knowing what’s on your formulary, asking your pharmacist if cash is better, switching to generics when possible, and checking if your plan’s preferred pharmacy is nearby. You don’t need to be an expert. You just need to ask the right questions. Below, you’ll find real examples of how people saved hundreds by understanding their coverage, switching drugs, or challenging pricing. These aren’t theory pieces. These are stories from people who were paying too much—and fixed it.