Standard Part D Drug Tier Structure
Most Medicare Part D plans use a 5-tier formulary:
| Tier | Drug Type | Typical Copay | Examples |
|---|---|---|---|
| Tier 1 | Preferred Generic | $0 – $15 | Metformin, lisinopril, atorvastatin |
| Tier 2 | Generic | $5 – $25 | Other generics not on preferred list |
| Tier 3 | Preferred Brand | $25 – $60 | Brand drugs the plan prefers |
| Tier 4 | Non-Preferred Brand | $60 – $150 | Brand drugs not on preferred list |
| Tier 5 | Specialty | 25% – 33% | Biologics, cancer drugs, specialty meds |
How Tier Placement Affects Your Cost
The same drug can be on different tiers in different plans - and the cost difference can be substantial. A brand-name drug on Tier 3 in one plan might be on Tier 4 in another, doubling or tripling your copay. This is why comparing plans based on your specific medications (not just premiums) is essential.
Ask your doctor if a generic equivalent is available for any brand-name drugs you take. Switching to a Tier 1 generic can save hundreds of dollars per year.
Requesting a Tier Exception
If your drug is on a high tier, you can request a tier exception - asking the plan to cover it at a lower tier's cost-sharing. To qualify, your doctor must certify that the lower-tier drugs in the same class are not appropriate for your condition. Tier exceptions are not guaranteed but are worth requesting for expensive medications.
Specialty Tier (Tier 5) Drugs
Specialty drugs are typically high-cost medications for complex conditions like cancer, rheumatoid arthritis, multiple sclerosis, and HIV. They're usually on Tier 5 with coinsurance of 25–33%. With the $2,000 out-of-pocket cap in 2026, specialty drug users will see significant savings compared to prior years.
The $2,000 OOP cap is especially beneficial for specialty drug users. Previously, someone on a $10,000/month specialty drug could face thousands in cost-sharing. Now, once you hit $2,000, you pay $0 for the rest of the year.