Medicare Part D

Medicare Part D's $2,100 drug cap arrives in Little Rock

LITTLE ROCK, Ark. — If you take prescription drugs and have Medicare, 2027 brings another update to Part D. Starting January 1, what you pay out of pocket for covered prescriptions will be capped at $2,400 for the year. Once you hit that number, you pay nothing more for the rest of 2027 on covered drugs picked up at a participating pharmacy.

For many Arkansans on fixed incomes — especially those juggling insulin, blood thinners, or cancer medications — this is a real shift worth understanding before the Annual Enrollment Period closes on December 7.

The 2027 cap, in plain English

Every Medicare Part D plan, whether it's a stand-alone drug plan or built into a Medicare Advantage plan, has to follow the same yearly out-of-pocket ceiling. In 2027, that ceiling is $2,400.

That figure counts what you actually pay for covered prescriptions — your deductible, copays, and coinsurance. It does not count your monthly premium, and it doesn't count drugs your plan doesn't cover.

The Part D deductible can also be no higher than $700 in 2027, though individual plans may set theirs lower. Once you meet whatever deductible your plan uses, you move into the cost-sharing phase until you hit $2,400 — then catastrophic coverage kicks in and your share drops to zero.

The "donut hole" is gone

For years, the coverage gap — the "donut hole" — tripped up people who took expensive medications. You'd move through an initial phase, hit the gap, pay more for a stretch, then finally reach catastrophic coverage.

That's over. As of 2025, Part D uses just three phases: deductible, initial coverage, and catastrophic. In 2027, that structure continues, with the $2,400 cap sitting at the top. No more surprise jump in your pharmacy bill in the middle of the year.

Meet the Medicare Prescription Payment Plan

Here's the piece a lot of people in Pulaski County are still learning about. Even with a $2,100 cap, some folks hit big drug costs early in the year — say, a $900 bill in January that wipes out their budget.

The Medicare Prescription Payment Plan (sometimes called "M3P") lets you spread those out-of-pocket drug costs across the calendar year in monthly installments instead of paying the pharmacy all at once. You still owe the same total; the plan just smooths it out.

A few things to know:

• It's optional and free to sign up. There's no interest or fee.
• You enroll through your Part D or Medicare Advantage drug plan, not through Medicare directly.
• Each month, you pay the plan (not the pharmacy) for whatever prescriptions you filled.
• It tends to help most if you have high drug costs early in the year. If your costs are low and spread out, it may not change much for you.

You can sign up before the year starts or any time during 2027.

What this means locally

Little Rock sits in Pulaski County, and like the rest of Arkansas, residents here have access to both stand-alone Part D drug plans and Medicare Advantage plans that include drug coverage. The number of plans available varies by county and changes each year, so it's worth checking the Medicare Plan Finder at medicare.gov during Open Enrollment.

The $2,100 cap and the new payment plan apply to every Medicare drug plan in the country — the rules don't change based on ZIP code. What can differ from plan to plan is which drugs are covered (the formulary), which pharmacies are preferred, and what you pay before you hit the cap.

That's why comparing your current plan's 2027 details against your actual medication list matters. Your plan sent you an Annual Notice of Change this fall; that document spells out what's shifting for next year.

Watch these dates

• October 15 – December 7: Medicare Annual Enrollment Period. You can join, switch, or drop a Part D or Medicare Advantage plan for 2027.
• January 1, 2027: New coverage begins. The $2,400 cap and payment plan option continue.
• January 1 – March 31, 2027: Medicare Advantage Open Enrollment. If you're already in a Medicare Advantage plan, you get one chance to switch to another MA plan or return to Original Medicare.

A quick note on higher-income beneficiaries

If your income is above $109,000 (single filer) or $218,000 (joint) on your 2024 tax return, you'll pay an income-related adjustment (IRMAA) on top of your Part D premium in 2026. That surcharge is separate from the $2,100 cap and does not count toward it.