Medicare Part D

Before you toss that September envelope, read this

MADISON, Wis. — The envelope that lands in Madison mailboxes each September looks routine. It isn't. That Annual Notice of Change, or ANOC, is your Part D or Medicare Advantage plan telling you exactly how your drug coverage will look different starting January 1 — and with the Annual Enrollment Period running October 15 through December 7, it's the single most important piece of mail a Medicare beneficiary will get this fall.

Even if you keep the same plan and pay the same premium, the list of drugs your plan covers — called a formulary — can shift from one year to the next. A medication that was easy to fill in 2025 might sit on a different tier in 2026, need prior approval, or come with a new quantity limit. Here's how those changes work, and how to spot them before you're standing at the pharmacy counter.

What tiers actually mean

Every Part D plan sorts covered drugs into tiers — usually three to six of them. Lower tiers generally hold preferred generics; higher tiers hold non-preferred brand-name and specialty drugs. Your cost share depends on which tier your medication sits in.

Plans can — and do — move drugs between tiers each year. A drug that was on a lower tier in 2025 could be placed on a higher one in 2026, which changes what you pay even if the plan's other rules stay the same. The ANOC lists tier changes for the coming year.

Utilization management: PA, step therapy, and quantity limits

Beyond tiers, plans use three common tools — collectively called utilization management — to control how certain drugs are dispensed:

• Prior authorization (PA): Your prescriber has to get the plan's approval before the drug is covered.
• Step therapy: You have to try a lower-cost or preferred alternative first, and only move to the requested drug if that one doesn't work or isn't tolerated.
• Quantity limits: The plan covers only a set amount of the drug over a set period — for example, a certain number of pills per 30 days.

None of these mean a drug is off the formulary. They just mean extra steps at the pharmacy. Adding a PA requirement or a quantity limit for the new plan year is one of the most common changes people miss when they skim the ANOC.

How to actually read the ANOC

The ANOC is organized so you can compare this year to next year side by side. When it arrives, focus on a few sections:

• The formulary changes section — look up every drug you take by name.
• The cost-sharing section — check whether your drugs' tiers changed.
• The utilization management notes — new PA, step therapy, or quantity limits are flagged here.

If a drug you rely on is affected, you have time. Annual Enrollment runs October 15 through December 7, and any change you make takes effect January 1. Medicare Advantage members also have a second window — the Medicare Advantage Open Enrollment Period — from January 1 through March 31.

The 2026 Part D rules that apply to everyone

Some parts of Part D are set by Medicare, not by individual plans. For 2026:

• The out-of-pocket cap is $2,100. Once your covered out-of-pocket spending on Part D drugs hits that amount, you pay $0 for covered drugs the rest of the year.
• The maximum Part D deductible is $615. Plans can set a lower deductible, but not a higher one.
• The coverage gap (the old "donut hole") remains eliminated — Part D now has three phases: deductible, initial coverage, and catastrophic.
• The Medicare Prescription Payment Plan is available. It lets you spread out-of-pocket drug costs across monthly payments instead of paying large amounts at the pharmacy.
• IRMAA surcharges on Part D premiums begin above $109,000 in income for a single filer in 2026.

What if you're new to a plan or a drug is dropped?

New enrollees and members whose drugs are removed mid-year are generally entitled to a transition fill — typically a one-time, limited supply of the drug — to give you and your prescriber time to switch medications or request an exception. If your plan denies coverage or requires a step you can't safely take, you (or your prescriber) can file a coverage determination or exception request.

Where Madison fits in

Madison is in Dane County, where beneficiaries typically have a wide choice of stand-alone Part D and Medicare Advantage plans with drug coverage. The specific plans available, and their formularies, are set at the county level and change every year — which is exactly why the ANOC matters and why a plan that worked for a neighbor may not be the right fit for you.

For personalized help comparing formularies, Wisconsin's State Health Insurance Assistance Program (SHIP) — known locally as the Medigap Helpline and the Wisconsin SHIP — offers free, unbiased counseling.