Key Takeaways

• In 2025, Medicare Part D includes a new $2,000 cap on out-of-pocket drug costs, but many commonly used medications and treatments still fall outside of coverage.

• You need to carefully review each Part D plan’s formulary, step therapy rules, and exclusions to avoid surprises that could affect your health and budget.

Why What Isn’t Covered Still Matters

Medicare Part D was created to offer prescription drug coverage, but it does not guarantee access to every medication. While the 2025 updates to Part D bring significant relief—such as the $2,000 out-of-pocket cap—these changes do not solve every problem. There are still categories of drugs that Part D does not cover at all, and many plans use utilization management tools that restrict access to others.

If you’re assuming all your prescriptions will be covered just because you have a Part D plan, you could be making a costly mistake.

The Categories Part D Is Not Required to Cover

Medicare sets specific rules about what Part D must and must not cover. Even though plan formularies (the list of drugs covered) vary, they must exclude entire categories of medications.

The following types of drugs are excluded from standard Medicare Part D coverage, no matter which plan you choose:

• Over-the-counter (OTC) medications: These include things like acetaminophen, ibuprofen, or antihistamines available without a prescription.

• Drugs for weight loss or weight gain: Even when medically necessary, weight management drugs are excluded.

• Drugs for cosmetic purposes or hair growth: These are not considered medically necessary and are not covered.

• Fertility drugs: Medications to assist with conception are not included.

• Drugs for sexual or erectile dysfunction: With limited exceptions, these drugs are not part of Part D coverage.

• Vitamins and minerals: Except for prenatal vitamins and certain therapeutic vitamins, most are excluded.

• Drugs covered under Part A or Part B: If a drug is administered in a hospital or doctor’s office, it may fall under Part A or B instead of Part D.

These exclusions are consistent across all Part D plans because they are set by federal guidelines.

2025’s $2,000 Out-of-Pocket Cap: Helpful but Not All-Inclusive

In 2025, a major improvement to Medicare Part D is the $2,000 annual out-of-pocket maximum for prescription drugs. Once your spending reaches this amount, your plan covers 100% of the cost for covered drugs for the rest of the year.

However, it is crucial to remember that this cap only applies to covered drugs. If a medication is not on your plan’s formulary or falls into an excluded category, you will continue to pay full price for it, and those costs do not count toward the cap.

How Prior Authorization and Step Therapy Can Block Access

Even if a drug is technically covered, your access to it may be limited by plan-specific rules like:

• Prior authorization: You need to get approval from the plan before the prescription is filled.

• Step therapy: You must try lower-cost or preferred drugs first and show they didn’t work before accessing the prescribed drug.

• Quantity limits: Your plan may only cover a limited supply per month.

These restrictions are legal and widely used. They can delay your access to medication or lead you to switch drugs, even if your doctor recommends otherwise.

Formularies Change Every Year

Medicare requires Part D plans to cover at least two drugs in every therapeutic class, but which specific drugs are included can change annually. This means that a medication covered in 2024 might not be covered in 2025.

Plans release a formulary each fall during Open Enrollment (October 15 to December 7), detailing which drugs will be covered the following year. It is essential that you review this document every year.

• If your drug is removed from the formulary, you might face higher costs or need to change medications.

• Some plans may move drugs to a higher cost-sharing tier, making them more expensive.

Even if you’re happy with your current plan, ignoring the Annual Notice of Change could result in unexpected expenses starting January 1.

What About Vaccines?

Thanks to recent legislative changes, Medicare Part D now covers most recommended vaccines at no cost to you. This includes shingles and RSV vaccines in 2025.

However, the location and billing method can impact whether your shot is processed under Part D or Part B. Getting vaccinated at a pharmacy usually routes it through Part D. If you get vaccinated at a doctor’s office and they bill through Part B, you might have a different cost-sharing responsibility.

Double-check where to go and how it will be billed to avoid unnecessary costs.

Non-Formulary Drugs: Options Are Limited

If your prescribed medication is not included in your plan’s formulary, you have a few options:

• Request a formulary exception: You or your prescriber must file paperwork explaining why you need the excluded drug.

• Switch to a different plan: During the next Open Enrollment, you can find a plan that includes your medication.

• Pay out of pocket: This option offers the least financial protection and does not count toward your $2,000 cap.

While formulary exceptions can help, there is no guarantee they will be granted. Plans have the authority to deny requests that don’t meet their criteria.

Drugs That Require Special Handling

Some medications require cold storage, special delivery, or administration by a specialist. These may be harder to obtain under Part D. In some cases, coverage may shift to Part B, or require you to use a specialty pharmacy.

• Make sure your pharmacy can handle these drugs.

• Confirm whether your plan allows home delivery or mandates pick-up.

• Understand any additional paperwork your doctor must submit.

Specialty drugs often have higher cost-sharing tiers and may come with stricter prior authorization rules.

The Role of Tier Pricing

Part D plans place medications into cost tiers. Each tier comes with its own copayment or coinsurance rate. The higher the tier, the more you pay. Common structure includes:

• Tier 1: Preferred generics (lowest cost)

• Tier 2: Non-preferred generics

• Tier 3: Preferred brand-name drugs

• Tier 4: Non-preferred brand-name drugs

• Tier 5: Specialty drugs (highest cost)

If your medication is moved from a lower to a higher tier in 2025, you may face significant cost increases, even if the drug remains covered.

Why 2025 Requires Closer Attention Than Ever

This year’s changes—especially the out-of-pocket cap—are important, but they have created a false sense of security for some beneficiaries. Just because the $2,000 cap exists doesn’t mean your drug costs are done causing you stress.

• Exclusions still exist and remain costly.

• Plan rules like prior authorization can delay or block access.

• Formularies and tier assignments change yearly.

Ignoring these facts could result in higher expenses and disruptions in your care.

What You Should Do Now

• Review your current plan’s 2025 formulary. Make sure all your medications are listed.

• Ask your pharmacist or doctor for help if you’re unsure about coverage changes.

• Compare plans during Open Enrollment (October 15 – December 7) if you spot any major differences.

• Request a tiering or coverage exception if your current medication is moved to a higher tier or excluded.

Being proactive now can help you avoid serious headaches in January.

Understanding the Gaps Is Just as Important as Knowing the Benefits

While Medicare Part D is becoming more protective with the 2025 out-of-pocket cap, it still leaves notable gaps. You have to take a hands-on approach to avoid surprises. Whether it’s navigating prior authorization, verifying formulary inclusion, or preparing for price hikes from tier adjustments, it pays to be vigilant.

If you’re unsure whether your plan meets your needs, speak with a licensed agent listed on this website. They can help you evaluate your options and guide you through your next steps.