Watch the short version
Tyler covers the $2,400 yearly drug cap in about a minute. The full breakdown is below.
A lot of people still think the Medicare drug cap is $2,000. That was 2025. In 2026 it moved to $2,100. For 2027, CMS set it at $2,400.
That is not a rumor. It is in the official 2027 Rate Announcement. Once your qualifying out-of-pocket drug costs hit $2,400, you pay nothing more for covered Part D drugs for the rest of that year.
The other number that will hit people in January is the deductible. CMS set the standard Part D deductible at $700 in 2027, up from $615 in 2026.
Part D is not ending
If you saw a post saying Medicare drug coverage disappears in 2027, that is wrong. Part D continues. Extra Help continues. The yearly cap continues. What ends after 2026 is a temporary CMS program that helped hold down premiums on some standalone drug plans.
$2,400
Yearly cap on covered Part D drugs
CMS 2027 Rate Announcement$700
Standard Part D deductible
CMS 2027 Rate Announcement$41.33
National base Part D premium
CMS July 28, 2026$0
What you pay for covered drugs after the cap
CMS / Inflation Reduction ActWhat CMS already set for 2027
CMS does this in layers. In January 2026, the agency proposed the 2027 payment rules. On April 6, 2026, it finalized the Part D benefit numbers. On July 28, 2026, it released the national bid and base-premium figures.
What is still missing, as of late August 2026, is your exact 2027 plan premium, formulary, and pharmacy network. CMS said those details come out with the plan landscape in mid-to-late September.
2026 vs. 2027 Part D numbers CMS has published
These are the official national figures. Your plan can still charge less than the standard deductible.
| Item | 2026 | 2027 | What it means |
|---|---|---|---|
| Standard deductible | $615 | $700 | You may pay more before copays start |
| Yearly out-of-pocket threshold | $2,100 | $2,400 | Then $0 for covered Part D drugs |
| Cost after you hit the cap | $0 | $0 | That protection stays |
| Donut hole | Gone | Still gone | It does not come back |
| National base premium | $38.99 | $41.33 | Not the premium every person pays |
| National average bid (NAMBA) | $239.27 | $296.05 | Used to calculate plan subsidies |
Sources: CMS 2027 Rate Announcement and CMS July 28, 2026 NAMBA fact sheet.
The cap went up because the law says it has to
Congress set the first cap at $2,000 in 2025. After that, CMS has to raise it each year using a formula tied to drug-cost growth. For 2027, that update was 13.65%. Then CMS rounded the cap to the nearest $50. That is how $2,100 became $2,400.
The deductible uses the same growth number, then rounds to the nearest $5. That is how $615 became $700.
The yearly drug cap is climbing, but it is still a hard stop
Annual Part D out-of-pocket threshold after the Inflation Reduction Act redesigned the benefit
Bottom line: The protection stays. The dollar amount just moved $300. Before 2025, people on expensive drugs could keep paying all year. That world is gone.
The standard deductible is moving too
Defined standard Part D deductible. Your plan may charge less.
How your 2027 drug year actually works
Forget the old donut hole. Since 2025, Part D has three parts: deductible, initial coverage, then catastrophic. 2027 uses the same three parts. The dollars just changed.
1. Deductible
Up to $700On a standard plan, you pay the full plan price of covered drugs until you hit the deductible. Some plans skip this. Some only apply it to brand drugs.
2. Initial coverage
Usually about 25%After the deductible, you pay a copay or coinsurance. On the standard design, that is generally 25% of the drug cost until your qualifying out-of-pocket total reaches $2,400.
3. Catastrophic
$0 for covered drugsAfter $2,400, you pay nothing more at the pharmacy for covered Part D drugs for the rest of 2027. You still pay the monthly premium.
Two numbers people mix up
The $700 deductible is the early-year amount you may have to satisfy first. The $2,400 cap is the yearly total that shuts off your copays. They are not the same thing.
What that looks like for three different people
These are examples, not promises. Your real cost depends on your drugs, your pharmacy, and the 2027 plan you pick. The point is the shape of the year.
Mostly generics
About $420
A few cheap generics. You may never hit the deductible, let alone the $2,400 cap.
A few brand drugs
About $1,480
You pay the deductible, then copays. You stay under the cap unless a high-cost drug gets added.
Specialty year
$2,400 then $0
Cancer, autoimmune, or other specialty drugs can hit the cap early. After that, covered Part D drugs are $0 for the rest of 2027.
Example yearly drug spend, before the monthly premium
Illustrative only. The specialty year stops at the $2,400 CMS cap.
Who still pays more than $2,400
The cap is real. It is also narrower than the headlines make it sound. Plenty of money connected to prescriptions never counts.
The cap does not cover everything with a pill bottle
If the drug is not on your plan, or Medicare does not cover it, those payments generally do not count toward $2,400. You can spend a lot and still never reach catastrophic coverage.
- Monthly premiums. These never count toward the cap.
- IRMAA. Higher-income people pay an extra Part D surcharge. That is separate. Check it on the IRMAA calculator.
- Drugs your plan will not cover. No exception, no credit toward the cap.
- Most coupon programs. GoodRx-style discounts and many manufacturer coupons sit outside Part D. We broke that down in the TrumpRx analysis.
- The Medicare GLP-1 Bridge copay. CMS set that program outside normal Part D. The $50 Bridge copay does not count toward the yearly cap. See the GLP-1 Bridge guide.
If you have Original Medicare plus a supplement, you still need a standalone Part D plan. Medigap does not pay for outpatient drugs. If you are on Medicare Advantage, drug coverage is usually built in. The $2,400 cap still applies to the Part D side of that plan.
Premiums, Extra Help, and spreading the bill
Your plan premium is not $41.33
CMS set the 2027 national base beneficiary premium at $41.33. That is a formula input. It is not the bill every person gets. Some plans will be cheaper. Some will be higher. Medicare Advantage plans can use extra money to buy down the drug premium, which is why those drug pieces often look tiny next to standalone Part D.
The law also caps how fast that national base premium can grow: no more than 6% a year through 2029. That 6% limit does not mean your personal plan can only go up 6%.
The temporary premium help for standalone drug plans is ending
CMS ran a short-term demonstration in 2025 and 2026 to keep standalone Part D premiums from jumping too fast. On July 28, 2026, CMS said that demonstration ends after 2026. That does not cancel Part D. It does mean standalone drug-plan prices can move more than they did under that extra guardrail. Wait for the September landscape before you panic or switch.
Extra Help is still here
Extra Help, also called the Low-Income Subsidy, was not canceled. If you qualify, it can wipe out the deductible and shrink copays.
CMS published the 2027 Extra Help copay ceilings in the same Rate Announcement. For many full-subsidy people over 100% of the federal poverty level, the max copays before the yearly cap are $5.80 for generics and $14.40 for other drugs. Some dual-eligible and nursing-home residents pay $0.
Apply through Social Security, or ask us to walk through it. Extra Help also opens a Special Enrollment Period, so you are not stuck waiting until fall.
You can spread the $2,400 across the year
Every Part D plan has to offer the Medicare Prescription Payment Plan. It turns a big pharmacy bill into monthly payments. It does not make the drugs cheaper. It just stops January from emptying the checking account.
Covered insulin still has a monthly cap, generally no more than $35 for a month's supply of each covered insulin product. Recommended adult vaccines under Part D stay at $0.
Some high-cost drugs get new Medicare prices in 2027
On January 1, 2027, negotiated Medicare prices take effect for 15 more Part D drugs. That second group includes medicines a lot of people actually take, like Ozempic, Wegovy, Trelegy, and Janumet. CMS says those prices are the amount the plan uses, not automatically the amount you pay at the counter. Your copay still follows the plan's rules until you hit the $2,400 cap.
What to do before December 7
Annual Enrollment for 2027 coverage runs October 15 through December 7, 2026. That is the window most people use to change Part D or Medicare Advantage plans.
- Read the Annual Notice of Change your current plan mails you. Look at the deductible, the drug list, and the pharmacy network. Not just the premium.
- Write down every drug, dose, and how often you take it. Then run it through Medicare Plan Finder.
- Check Extra Help if your income is tight. A lot of people qualify and never apply.
- If you missed Part D when you first became eligible, use the penalty calculator before you guess.
- Do not switch based on a Facebook post about Part D “ending.” Compare the real 2027 plan once CMS publishes it.
The simple version
Budget a possible $700 deductible and a $2,400 worst-case year for covered drugs. Then compare your actual prescriptions in October. The national numbers tell you the rules. Your drug list tells you the bill.
Want your 2027 drugs run before you pick a plan?
We will compare your medication list against the plans we can offer in your county. No pressure. Education first.
Common questions
Is Medicare Part D ending in 2027?
No. Part D continues. What ends after 2026 is a temporary CMS program that helped hold down premiums on some standalone drug plans. Extra Help continues. The yearly cap on covered drug costs continues. The dollar amount of that cap is $2,400 in 2027.
What is the 2027 Medicare Part D out-of-pocket maximum?
CMS set the 2027 annual out-of-pocket threshold at $2,400. Once your qualifying drug costs reach that amount, you pay $0 for covered Part D drugs for the rest of that calendar year. Your monthly plan premium does not count toward the $2,400.
What is the 2027 Part D deductible?
The defined standard deductible is $700 in 2027, up from $615 in 2026. That is the highest a standard plan can charge. Some plans charge less, and some charge nothing. You will not know your plan's exact deductible until CMS releases the 2027 plan landscape.
Does hitting $2,400 mean I stop paying my Part D premium?
No. The cap only applies to covered drug copays, coinsurance, and deductible. You still pay the monthly plan premium. If you owe IRMAA, you still owe that too.
Do GoodRx, TrumpRx, or manufacturer coupons count toward the $2,400?
Usually no. The cap only counts qualifying Part D costs on covered drugs. Coupon programs that sit outside Part D generally do not move you toward catastrophic coverage. That is why we still compare your actual drug list against Part D plans instead of chasing a coupon first.
When can I change my 2027 drug plan?
Most people change during Annual Enrollment, October 15 through December 7, 2026. The new plan starts January 1, 2027. You may also have a Special Enrollment Period if you move, lose other coverage, or qualify for Extra Help.
Related resources
- Medicare Part D plan guidance
- Part D late-enrollment penalty calculator
- Medicare costs for 2026
- Annual Enrollment checklist
- Medicare FAQ
- Book a Medicare review
- Official Medicare Plan Finder
Tyler Dalton — Licensed Medicare Broker
Tyler is a pharmacist and independent Medicare broker at Dalton Insurance Agency in Dadeville, Alabama. He compares Part D and Medicare Advantage drug coverage against a person's actual medication list, then stays with clients for the yearly review.
We do not offer every plan available in your area. Currently, we represent 5 insurance organizations and offer over 50 Medicare products. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week, or your local State Health Insurance Program (SHIP) to get information on all of your options.
This article is for educational purposes only and is not personalized insurance, tax, or legal advice. 2027 Part D standard-benefit figures come from the CMS Calendar Year 2027 Rate Announcement and the July 28, 2026 national bid fact sheet. Plan-specific 2027 premiums, formularies, and pharmacy networks were not final as of August 30, 2026. Example yearly-cost scenarios are illustrations, not quotes. Medicare has neither reviewed nor endorsed this information. Dalton Insurance Agency is not affiliated with or endorsed by Medicare, CMS, or the federal government. This is a solicitation for insurance. You may be contacted by a licensed insurance agent.