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Medicare
Medicare is federal health insurance for people 65 and older. Understanding when and how to enroll — and which supplemental coverage to add — can save you thousands per year.
Initial Enrollment Period (IEP)
March 2026 – September 2026(65th birthday: June 15, 2026)
Enroll in the first 3 months for coverage to begin on your birthday. Waiting until months 4–7 may delay your start date.
Your 7-month IEP opens 3 months before your 65th birthday. Missing it means waiting for the General Enrollment Period (Jan–Mar) with coverage starting July 1.
Still on employer coverage? A Special Enrollment Period (8 months after it ends) applies — no late penalty.
Already receiving Social Security at 65? You're auto-enrolled in Parts A and B.
Original Medicare (A + B) covers 80% of approved costs. The remaining 20% — plus deductibles — is where supplemental insurance matters.
Part B: +10% per year missed. Permanent.
Part D: +1% per month without creditable drug coverage. Permanent.
Employer/union/TRICARE/VA coverage counts as creditable coverage — enroll within 63 days of losing it to avoid penalties.
• Online at ssa.gov/medicare
• Call 1-800-MEDICARE (1-800-633-4227)
• Local Social Security office
Supplemental Coverage: Medigap vs. Medicare Advantage
Original Medicare leaves significant gaps. Most retirees choose one of two paths to fill them.
Private insurance that works alongside Original Medicare to cover its cost-sharing gaps. Plans are standardized by federal law (Plan A, B, C, D, F, G, K, L, M, N) — the same letter plan has identical benefits regardless of insurer.
Advantages
✓ Use any doctor or hospital that accepts Medicare nationwide
✓ No referrals needed for specialists
✓ Predictable, low out-of-pocket costs (especially Plan G)
✓ Most plans include foreign travel emergency coverage (80%)
Disadvantages
✗ Higher monthly premiums than Advantage
✗ No prescription drug coverage — need a separate Part D plan
✗ Medical underwriting applies outside Open Enrollment (can be denied or charged more based on health)
Best for: People who want maximum flexibility, travel, or have ongoing healthcare needs.
An all-in-one alternative to Original Medicare offered by private insurers. Includes Parts A and B coverage, usually Part D, and often dental, vision, and hearing.
Advantages
✓ Often $0 monthly premium
✓ May include dental, vision, hearing, fitness benefits
✓ Prescription drugs bundled (MAPD plans)
✓ Annual out-of-pocket cap (≤$9,250 in-network, 2026)
Disadvantages
✗ Network restrictions — HMO/PPO with in-network requirements
✗ Prior authorization often required for procedures
✗ Coverage limited when traveling — out-of-network costs can be high
✗ Plans change annually — benefits, networks, and costs may shift
Best for: People who want low premiums, are generally healthy, and stay in a defined geographic area.
Your Priorities
Select what matters most to tailor the plan recommendations below.
| Plan | Est. Monthly Premium | Max Annual OOP | Any Doctor | Travel | Rx Bundled | Best For |
|---|---|---|---|---|---|---|
Medigap Plan GRecommended Medigap | $110–$195/mo | ~$283/yr (Part B deductible only, 2026) | ✓ | ✓ | ✗ | Maximum coverage, predictable costs |
Medigap Plan N Medigap | $75–$150/mo | ~$283 deductible + $20 office / $50 ER copays | ✓ | ✓ | ✗ | Balance of coverage and cost |
Medigap Plan K Medigap | $50–$100/mo | $8,000/yr cap (2026) | ✓ | ✗ | ✗ | Lowest Medigap premium, catastrophic cap |
Medicare Advantage Medicare Advantage | $0–$60/mo | Up to $9,250/yr in-network | ✗ | ✗ | ✓ | Low premiums, bundled Rx & dental |
* Premium estimates are approximate for a 65-year-old. Actual premiums vary by age, gender, state, tobacco use, and insurer. Medigap plan benefits are federally standardized per plan letter — identical across insurers. Contact providers directly for exact quotes.
† Premiums above do not include the Part B premium (~$202.90/mo in 2026), which all enrollees pay to Medicare separately on top of any plan premium.
‡ Based on your married filing jointly status, if your 2024 MAGI exceeded $218,000, IRMAA surcharges add at least +$81.20/mo to Part B and +$14.50/mo to Part D. See Financial Viability for the full bracket table.
Top Providers for Medigap Plan G in Texas
Medicare Part D is the optional prescription drug benefit added to Original Medicare. You enroll through a standalone Prescription Drug Plan (PDP) — offered by private insurers — that works alongside your Part A, Part B, and any Medigap coverage.
Already on Medicare Advantage? Most Medicare Advantage plans (MAPD) already bundle prescription drug coverage, so a separate Part D plan is typically not needed — and enrolling in one while on MAPD may actually trigger a disenrollment from your Advantage plan. Check your MAPD's Evidence of Coverage to confirm drug benefits before enrolling in a PDP.
Part D plans vary by premium, deductible, and drug tier structure. The lowest-premium plan is rarely the lowest total-cost plan once you factor in your specific medications. Use the scenario table below to estimate annual costs for common drug profiles.
Four Cost Factors That Drive Your Annual Bill
Premium
The monthly fee you pay regardless of how many prescriptions you fill. Ranges from $0 to $180+/mo depending on the plan. Lower-premium plans typically have higher deductibles and copayments.
Deductible
The amount you pay out-of-pocket before the plan starts covering drug costs. The 2026 maximum is $600. Many plans waive the deductible for Tier 1 generics; zero-deductible plans usually carry higher premiums.
Copayments / Coinsurance
Your share per prescription fill — a fixed dollar copay for lower tiers, or a percentage of drug cost (coinsurance) for higher tiers. Copays reset each January 1.
Drug Tiers (Formulary)
Each plan groups covered drugs into 5 tiers. The tier assignment determines your cost share. The same drug can be a different tier across plans, so comparing formularies side-by-side matters for your specific medications.
Drug Tier Structure (Formulary Tiers)
| Tier | Example Drugs | Typical Cost Share |
|---|---|---|
| Tier 1 — Generic Preferred | Atorvastatin, Amlodipine, Lisinopril, Metformin, Levothyroxine | $0/fill |
| Tier 2 — Generic Non-Preferred | Metoprolol, Celecoxib | $5–$15/fill |
| Tier 3 — Preferred Brand | Jardiance, Eliquis | $45–$47/fill or 25% |
| Tier 4 — Non-Preferred Brand | Various brand-name drugs without preferred status | 40–45% coinsurance |
| Tier 5 — Specialty | Enbrel (etanercept) and other biologics/injectables | 25–33% coinsurance |
Tier assignments vary by plan. A drug listed as Tier 2 on one plan may be Tier 3 on another. Always verify your specific drugs in a plan's formulary before enrolling.
How Drug Costs Vary by Health Profile
Estimated annual costs (2026) for three plan archetypes across five common drug profiles. The lowest total annual cost per scenario is bolded.
Scenario 1: Healthy — No Regular Prescriptions
Takes no regular prescription drugs.
No prescription drugs.
| Plan Type | Annual Premium | Annual Drug OOP | Total Annual Cost |
|---|---|---|---|
| Low-Premium ($0–$15/mo) Minimal cost; low-premium plan makes sense if drug needs are unlikely. | $60 | $0 | $60 |
| Mid-Premium (~$35/mo) No drug spending — premium is the only cost. | $420 | $0 | $420 |
| High-Premium (~$150/mo) Overpays relative to drug use; not recommended for healthy enrollees. | $1,800 | $0 | $1,800 |
Scenario 2: Hypertension/Cholesterol — Common Generics Only
Takes 3–4 common Tier 1 generics monthly.
| Plan Type | Annual Premium | Annual Drug OOP | Total Annual Cost |
|---|---|---|---|
| Low-Premium ($0–$15/mo) All Tier 1 — no drug OOP regardless of plan. Low-premium plan wins. | $60 | $0 | $60 |
| Mid-Premium (~$35/mo) All Tier 1 drugs covered at $0; premium is the only cost difference. | $420 | $0 | $420 |
| High-Premium (~$150/mo) Tier 1 generics cost $0 on all plans — high premium adds no benefit here. | $1,800 | $0 | $1,800 |
Scenario 3: Diabetes — Mix of Generics and Tier 3 Brand
Takes common generics plus a Tier 3 diabetes brand drug monthly.
| Plan Type | Annual Premium | Annual Drug OOP | Total Annual Cost |
|---|---|---|---|
| Low-Premium ($0–$15/mo) $590 deductible applies to Tier 3; then $47/fill × ~10 remaining fills. | $60 | $1,060 | $1,120 |
| Mid-Premium (~$35/mo) Lower deductible ($100) reduces total drug OOP significantly. | $420 | $570 | $990 |
| High-Premium (~$150/mo) Zero deductible and lowest Tier 3 copay — lowest drug OOP. | $1,800 | $300 | $2,100 |
Scenario 4: Heart Disease / AFib — Generics + Tier 2 & 3
Takes Tier 1 generics, a Tier 2 beta-blocker, and a Tier 3 blood thinner.
| Plan Type | Annual Premium | Annual Drug OOP | Total Annual Cost |
|---|---|---|---|
| Low-Premium ($0–$15/mo) $590 deductible on Tier 3 Eliquis; Metoprolol adds modest Tier 2 copays. | $60 | $1,140 | $1,200 |
| Mid-Premium (~$35/mo) Reduced deductible and lower Tier 3 copay cuts annual drug spend. | $420 | $660 | $1,080 |
| High-Premium (~$150/mo) No deductible; Metoprolol is $0 Tier 2 and Eliquis $25 — lowest OOP. | $1,800 | $300 | $2,100 |
Scenario 5: Specialty Drug (Biologic) — OOP Cap Triggered
Takes a Tier 5 specialty biologic plus a Tier 2 anti-inflammatory.
| Plan Type | Annual Premium | Annual Drug OOP | Total Annual Cost |
|---|---|---|---|
| Low-Premium ($0–$15/mo) OOP cap reached within a few months on Enbrel. IRA equalizes drug OOP across all plans — low premium then wins on total cost. | $60 | $2,100 | $2,160 |
| Mid-Premium (~$35/mo) Drug OOP capped at the same amount as the low-premium plan; higher premium produces a worse total. | $420 | $2,100 | $2,520 |
| High-Premium (~$150/mo) Drug OOP capped at the same amount on every plan. The $1,800 premium is pure added cost — the worst outcome of the three. | $1,800 | $2,100 | $3,900 |
† 2026 figures. Max deductible $600 applies to Tier 2+ drugs; Tier 1 generics are usually deductible-exempt. Annual out-of-pocket cap $2,100 (Inflation Reduction Act) — once reached, the plan pays 100% for the remainder of the year.
Premium + drug OOP are the primary cost drivers shown above. Does not include the Part B premium (~$170–$203/mo), which all Medicare enrollees pay separately.
Costs are estimates based on CMS median plan data; actual costs depend on your specific plan's formulary, preferred pharmacy network, and dosage. All major insurers offer an online formulary tool — enter your exact prescriptions to get a personalized cost estimate before enrolling.
How the Inflation Reduction Act Changed Part D Math
Before 2025, high-premium plans were justified by unlimited drug-spending risk — a biologic or specialty drug could mean $10,000+ in annual out-of-pocket costs with no ceiling. The IRA's $2,100 cap (2026) eliminates that tail risk on every plan equally.
Low-premium plan — worst case
$2,100 drug OOP + ~$60/yr premium
≈ $2,160 total ceiling
High-premium plan — worst case
$2,100 drug OOP + $960–$2,160/yr premium
≈ $3,060–$4,260 total ceiling
Remaining cases where higher-premium plans could make sense: (1) Cash-flow smoothing — avoiding the year's deductible hitting in January; premium spreads the cost evenly month-to-month. (2) Formulary placement — if your specific drug sits on a significantly lower tier on one plan's formulary than another's, the copay difference may offset some of the premium gap. Neither is a strong financial argument for most enrollees. Use medicare.gov/plan-compare with your exact drug list to compare true annual costs before enrolling.
Major Part D Plan Providers — 2026
T1–T5 show your copay (flat $) or coinsurance (%) per 30-day prescription fill at each formulary tier. Dollar amounts are fixed copays; percentages are coinsurance of the drug's cost. Tier 1 = generic preferred · Tier 2 = generic non-preferred · Tier 3 = preferred brand · Tier 4 = non-preferred brand · Tier 5 = specialty/biologic.
OOP Max = annual Out-of-Pocket Maximum — the most you pay in covered drug costs in a calendar year. Once you reach this limit, the plan pays 100% for the rest of the year. All plans shown are capped at $2,100 per the Inflation Reduction Act (2026).
| Plan | Premium | Deductible | T1 | T2 | T3 | T4 | T5 | OOP Max |
|---|---|---|---|---|---|---|---|---|
| Low-Premium Plans$0–$35/mo · $600 deductible · Best when using mostly Tier 1 generics | ||||||||
WellCare Value Script Centene Formulary →1-800-935-5462 Very low to no premium. Higher Tier 4 coinsurance than some competitors. | $0–$20/mo | $590 | $0 | $5 | $45 | 45% | 25% | $2,100 |
SilverScript SmartSaver Aetna/CVS Health Formulary →1-866-235-5660 Full deductible applies to Tier 2+. Low premium; best for generic-only users. | $0–$22/mo | $590 | $0 | $5 | $47 | 40% | 25% | $2,100 |
Humana Walmart Value Rx Humana Formulary →1-800-281-6918 Lowest Tier 2 copay in class ($4). Preferred pharmacy: Walmart. | $0–$28/mo | $590 | $0 | $4 | $47 | 40% | 25% | $2,100 |
AARP MedicareRx Walgreens UnitedHealthcare Formulary →1-877-699-5710 Preferred pharmacy: Walgreens. Broad formulary coverage. | $0–$35/mo | $590 | $0 | $10 | $47 | 40% | 25% | $2,100 |
| Mid-Premium Plans~$20–$50/mo · No deductible · Lower copays balance the higher premium | ||||||||
SilverScript Choice Aetna/CVS Health Formulary →1-866-235-5660 No deductible; lower Tier 3 copay than low-premium plans. | $22–$48/mo | $0 | $0 | $5 | $40 | 35% | 25% | $2,100 |
WellCare Classic Centene Formulary →1-800-935-5462 No deductible; good middle-ground for Tier 2–3 drug users. | $20–$50/mo | $0 | $0 | $8 | $40 | 35% | 25% | $2,100 |
| High-Premium Plans~$80–$180/mo · No deductible · Lowest per-fill copays — but post-IRA the $2,100 cap makes total costs higher than low-premium plans in most scenarios | ||||||||
AARP MedicareRx Preferred UnitedHealthcare Formulary →1-877-699-5710 No deductible; $0 Tier 2 copay. Post-IRA, the premium gap vs. low-premium plans usually exceeds the per-fill savings — verify with your drug list before choosing. | $85–$160/mo | $0 | $0 | $0 | $30 | 25% | 25% | $2,100 |
Humana Premier Rx Humana Formulary →1-800-281-6918 Lowest Tier 3 copay ($25); no deductible. Post-IRA OOP cap equalizes drug costs for specialty users — lower-premium plans produce a lower total in most scenarios. | $80–$180/mo | $0 | $0 | $0 | $25 | 25% | 25% | $2,100 |
Premium ranges reflect geographic variation across plan service areas. ‡ High-income enrollees may pay IRMAA surcharges of $0–$91/mo on top of their Part D premium. See Financial Viability for the full IRMAA bracket table.
Sources: KFF 2025 Part D Landscape, CMS Medicare Plan Finder, plan-specific Summary of Benefits. Verify current formularies and premiums at medicare.gov/plan-compare before enrolling.