Medicare Supplement

Madison Medicare: why Medigap skips the pharmacy, and how Part D fills the gap

MADISON, Wis. — If you're turning 65 in Madison or shopping your coverage during the fall enrollment window, here is one detail that trips up a lot of people: a Medigap policy will help with the bills Original Medicare leaves behind, but it will not pay for the prescriptions you pick up at the pharmacy. For that, you need a separate stand-alone Part D drug plan — and the timing of when you sign up matters for the rest of your life.

Medicare SupplementMadison, WI

How the three pieces fit together

Think of Original Medicare (Parts A and B), a Medigap policy and a Part D plan as three separate puzzle pieces that snap together.

• Original Medicare pays the bulk of your hospital and doctor bills, but it leaves deductibles and coinsurance behind, and it does not cover most outpatient prescriptions.
• Medigap (also called Medicare Supplement Insurance) is a policy you buy from a private insurer to help pay those leftover Original Medicare costs — things like the Part A hospital deductible or the 20% Part B coinsurance, depending on which lettered plan you choose.
• Part D is a separate stand-alone prescription drug plan, also sold by private insurers, that covers the medications you fill at a pharmacy.

Medigap policies sold today are not allowed to include drug coverage. (Some very old Medigap policies purchased before 2006 did include limited drug benefits, but those are no longer sold.) So if you want help paying for prescriptions and you're keeping Original Medicare, a Part D plan is the piece that handles it.

Why Madison retirees often choose this combination

Madison sits in Dane County, and like the rest of Wisconsin, retirees here generally have two paths to build their Medicare coverage: pair Original Medicare with a Medigap policy and a Part D plan, or enroll in a Medicare Advantage plan that usually rolls medical and drug coverage into one package.

The Original Medicare + Medigap + Part D route tends to appeal to people who travel, split time between homes, or want to see any provider in the country that accepts Medicare. It's also the setup where the "Medigap doesn't cover drugs" rule matters most — because there's no Advantage plan bundling everything for you.

Wisconsin is one of three states (along with Massachusetts and Minnesota) that standardizes its Medigap policies differently than the rest of the country. If a Wisconsin agent or the SHIP counselor uses different plan names than you saw online, that's why.

The Part D late enrollment penalty, plainly

This is the timing rule that catches people off guard.

Once you're first eligible for Medicare, you generally have to enroll in a Part D plan (or have other "creditable" drug coverage, meaning coverage at least as good as Medicare's) during your Initial Enrollment Period. If you go 63 days or more in a row without creditable drug coverage after that, Medicare can charge you a late enrollment penalty when you finally sign up.

The penalty isn't a one-time fee. It gets added to your Part D premium every month, for as long as you have Part D coverage. The amount grows the longer you waited.

A few situations that commonly cause trouble:

• Someone signs up for Medigap at 65 but skips Part D because they aren't taking any medications. Years later, they need a prescription and try to enroll — and the penalty follows them.
• Someone loses employer or union drug coverage and doesn't realize the 63-day clock has started.
• Someone assumes VA benefits, retiree coverage or another plan is "creditable" without checking. Your current plan should send you a notice each year telling you whether it is.

If you're not sure, ask your current insurer or benefits office for the creditable coverage notice in writing.

What changes about Part D in 2026

A few program-level figures are worth knowing as you shop:

• The maximum Part D deductible any plan can charge in 2026 is $615.
• There is a $2,100 annual out-of-pocket cap on covered drugs — once you hit it, you pay $0 for the rest of the calendar year on covered prescriptions.
• The old "donut hole" coverage gap was eliminated in 2025, so Part D now has three phases instead of four.
• If your drug costs are lumpy, the Medicare Prescription Payment Plan lets you spread out-of-pocket costs across the year in monthly installments instead of paying big bills at the counter.
• Higher-income enrollees pay an IRMAA surcharge on top of the Part D premium. In 2026, that starts above $109,000 in income for a single filer (based on your tax return from two years earlier).

When to enroll

Two windows matter most:

• Your Initial Enrollment Period — the seven-month window around your 65th birthday — is when you first pick up Part D without a penalty.
• The Annual Enrollment Period, Oct. 15 through Dec. 7, is when anyone on Medicare can join, drop or switch a Part D plan. Coverage takes effect Jan. 1.

The Medicare Advantage Open Enrollment Period (Jan. 1 – March 31) is a different window and doesn't apply to stand-alone Part D changes for people on Original Medicare.

Medigap has its own timing rules. The best time to buy a Medigap policy is your six-month Medigap Open Enrollment Period, which starts the month you're 65 or older and enrolled in Part B. During that window, insurers can't turn you down or charge you more based on your health. Outside it, they generally can — so don't drop a Medigap policy casually.

Where to get personal help in Madison

Medicare choices are personal, and the "right" mix depends on the medications you actually take, the pharmacies you use and your household income. A few free, unbiased resources:

• Medicare Plan Finder at medicare.gov lets you enter your prescriptions and compare Part D plans available in Dane County.
• 1-800-MEDICARE (1-800-633-4227) is staffed 24/7.
• Wisconsin's SHIP — the Medigap Helpline, run by the Wisconsin Board on Aging and Long Term Care — offers free one-on-one counseling for Wisconsin residents at 1-800-242-1060.
• The Dane County Area Agency on Aging in Madison can also point you to local benefit specialists.