Who Pays for Chemotherapy Drugs on Medicare?

Chemotherapy treatment can be a significant undertaking, both medically and financially. Many individuals rely on Medicare, a federal health insurance program, to help manage these costs. Medicare provides coverage for a wide range of medical services, including those necessary for chemotherapy. This article clarifies Medicare’s role in covering chemotherapy drugs and related services.

Medicare Coverage for Chemotherapy

Medicare covers chemotherapy drugs and administration through different parts, depending on where treatment is received and the type of drug involved. The specific Medicare part determines how costs are handled.

Medicare Part A, or Hospital Insurance, covers chemotherapy administered during an inpatient hospital stay. This includes medications provided while admitted and the hospital stay itself. Part A also covers services in a skilled nursing facility after a hospital admission, and hospice care, which can include chemotherapy as part of palliative care.

Medicare Part B, or Medical Insurance, is the primary payer for most chemotherapy drugs and services in an outpatient setting. This includes intravenous (IV) chemotherapy drugs administered in a doctor’s office, hospital outpatient clinic, or infusion center. Part B also covers related services like doctor visits, chemotherapy administration fees, and some oral chemotherapy drugs if they are a prodrug of an injectable drug or if the same drug is available in an injectable form. It also covers certain anti-nausea drugs if administered within 48 hours of chemotherapy.

Medicare Part D provides prescription drug coverage, typically for oral chemotherapy drugs and other self-administered cancer medications obtained from a pharmacy. These plans are offered by private companies and have their own formularies. While formularies vary, all Part D plans must cover at least two drugs in each drug category and most anticancer drugs, unless covered by Part B.

Understanding Your Costs

Understanding the financial responsibilities for chemotherapy under Medicare involves examining deductibles, coinsurance, and copayments for each part. These out-of-pocket expenses vary based on the specific Medicare plan and services received.

For chemotherapy under Medicare Part A during an inpatient hospital stay, beneficiaries are responsible for a deductible per benefit period. In 2025, this inpatient hospital deductible is $1,676. For extended stays, a daily coinsurance applies: $419 per day for days 61-90 of a benefit period, and $838 per day for lifetime reserve days (up to 60 days). If chemotherapy is received in a skilled nursing facility, the daily coinsurance for days 21-100 of extended care services will be $209.50 in 2025.

Chemotherapy covered under Medicare Part B involves an annual deductible and coinsurance. The annual Part B deductible for 2025 is $257. After meeting this, beneficiaries typically pay 20% of the Medicare-approved amount for intravenous chemotherapy and related services, such as doctor visits and administration fees. There is no annual limit on this 20% coinsurance under Original Medicare, meaning out-of-pocket costs can accumulate significantly.

For oral chemotherapy drugs and other self-administered medications covered by Medicare Part D, several cost-sharing elements apply. The annual deductible for Part D plans in 2025 can be no more than $590, though some plans may have a lower or zero deductible. After the deductible is met, beneficiaries enter the initial coverage period, typically paying 25% of their prescription drug costs, often as copayments or coinsurance. For 2025, the coverage gap (often called the “donut hole”) is eliminated, and an annual cap on out-of-pocket spending for covered Part D drugs is in place. Once a beneficiary’s out-of-pocket costs for covered drugs reach $2,000 in 2025, they enter the catastrophic coverage phase, paying nothing for covered medications for the remainder of the year.

Assistance with Chemotherapy Costs

Various programs can help manage the financial burden of chemotherapy under Medicare by reducing out-of-pocket expenses. These options offer additional coverage beyond Original Medicare.

Medicare Supplement Insurance, or Medigap, helps cover some or all out-of-pocket costs left by Original Medicare Parts A and B. Medigap plans can pay for deductibles, coinsurance, and copayments that Original Medicare does not cover. Private companies offer these standardized plans, meaning benefits for each plan type are the same regardless of the insurer.

Medicare Advantage Plans, or Part C, are offered by private insurance companies approved by Medicare and cover all benefits of Original Medicare Parts A and B. These plans often have different cost-sharing structures, such as fixed copayments for services. Many include Part D prescription drug coverage (MAPD plans). A notable benefit of Medicare Advantage plans is their annual out-of-pocket maximum for services covered under Parts A and B, which limits how much a beneficiary pays in a year. In 2025, this out-of-pocket limit for in-network services cannot exceed $9,350, though individual plans may set lower limits.

Medicare’s Extra Help program, also called the Low-Income Subsidy (LIS), is a federal initiative assisting individuals with limited income and resources in paying for Part D prescription drug costs. This program can significantly lower or eliminate Part D premiums, deductibles, and reduce copayments for covered medications, including oral chemotherapy. Eligibility is determined by income and asset thresholds, and those who qualify receive substantial financial relief.

Beyond federal programs, State Pharmaceutical Assistance Programs (SPAPs) and Patient Assistance Programs (PAPs) can provide additional financial aid. SPAPs are state-specific programs helping residents with prescription drug costs. Patient Assistance Programs are typically offered by pharmaceutical manufacturers, providing free or low-cost medications to eligible patients who cannot afford their prescriptions.