The redesigned Medicare drug benefit that began in 2025 continues in 2027, with the dollar limits adjusted upward. The annual out-of-pocket cap for covered Part D drugs rises to $2,400, from $2,100 in 2026. Once you spend $2,400 out of pocket in 2027, you won’t pay anything more for covered drugs for the rest of the year.
The maximum Part D deductible also rises, to $700 from $615. Plans can set a lower deductible or waive it for certain tiers, so compare plans on this point.
The old catastrophic phase remains eliminated. Previously, you paid five percent of drug costs after reaching a certain spending threshold. That coinsurance is gone.
The Medicare Prescription Payment Plan continues. Instead of paying large amounts at the pharmacy counter, you can opt to pay in monthly installments spread across the year. It doesn’t lower what you owe, but it smooths it out.
If you’ve skipped enrolling in Part D because of cost concerns in the past, the cap and the payment plan together make drug costs far more predictable than they were a few years ago.