Medicare Part D
Jan. 1, 2027: Medicare Part D Cap in Los Angeles
LOS ANGELES — Starting Jan. 1, 2027, people with Medicare drug coverage will hit a firm ceiling on what they pay out of pocket for prescriptions: $2,400 for the year. Once you reach that amount, you pay nothing for covered drugs the rest of the calendar year. It's part of a run of major changes to Medicare Part D, and it lands right as Angelenos are sorting through their fall coverage choices.
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Will your prescriptions still be covered in 2027?
Part D plans rewrite their drug lists every year — tiers move, pharmacies change, drugs drop off. One call checks your exact medications against the 2027 plans in your area.
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Speak to a Licensed Insurance Agent
Click to call 855-729-3240Key takeaways
- Starting January 1, 2027, Medicare Part D drug spending will be capped at $2,400 for the year, up from $2,100 in 2026.
- Once you hit that cap, you pay $0 for covered drugs for the rest of the calendar year.
- The old "donut hole" coverage gap is gone, leaving just three phases: deductible, initial coverage, and catastrophic coverage.
- A free, optional Medicare Prescription Payment Plan lets you spread your drug costs into monthly payments instead of paying it all at once, though it doesn't lower your total cost.
Here's how the new cap works, what happened to the old "donut hole," and how a new monthly payment option can spread those costs across the year.
By the numbers
Medicare Part B premium, 2006–2026
The standard monthly Part B premium has climbed from $88.50 in 2006 to $202.90 in 2026. Hover any point for that year’s premium.
Source: CMS. Standard premium shown; in some hold-harmless years many existing enrollees paid less. Confirm at Medicare.gov.
By the numbers
How people get Medicare in Los Angeles County
(MA penetration in Los Angeles County)
MA penetration from CMS enrollment data; Medigap share is an estimate. U.S. average is about 54% Medicare Advantage. These are area-level figures, not plan-specific.
What's changing in 2027
The Part D out-of-pocket cap is $2,100 in 2026 and $2,400 in 2027. That limit applies to what you personally pay for covered prescriptions — through a stand-alone Part D plan or the drug coverage built into a Medicare Advantage plan.
A few other program-level numbers to know for 2027:
- Maximum Part D deductible: $700 in 2027 (plans can set theirs lower).
- IRMAA surcharges on Part B and Part D premiums begin above $109,000 in income for a single filer.
- Annual Enrollment Period: Oct. 15 – Dec. 7.
- Medicare Advantage Open Enrollment: Jan. 1 – March 31.
These figures come from CMS's Part D program rules and apply nationwide, including here in Los Angeles.
The "donut hole" is gone
For years, Part D had four phases, and the third one — the coverage gap, or "donut hole" — was where a lot of people got tripped up. After you and your plan spent a certain amount, your share of costs suddenly jumped, then dropped again once you hit catastrophic coverage.
As of 2025, that gap was eliminated. Part D now has just three phases:
1. Deductible (if your plan has one, up to $700 in 2027). 2. Initial coverage, where you pay a share of the cost of each drug. 3. Catastrophic coverage, which kicks in once your out-of-pocket spending hits the annual cap — $2,400 in 2027. After that, you pay nothing for covered drugs for the rest of the year.
For anyone who once dreaded the donut hole — especially people on expensive brand-name medications — this is a meaningful simplification.
The Medicare Prescription Payment Plan
Reaching the cap ($2,100 in 2026, $2,400 in 2027) is good news at the pharmacy counter, but hitting it in January or February can still sting. That's where the Medicare Prescription Payment Plan comes in.
This is a free, optional program launched in 2025. Instead of paying a large amount up front at the pharmacy, you can choose to have your drug costs spread across monthly payments for the rest of the calendar year. You still owe the same total — the program doesn't lower your costs — but it evens out the cash flow.
A few things to know:
- You sign up through your Part D or Medicare Advantage drug plan, not through Medicare directly.
- You can join before the plan year starts or any time during the year.
- The pharmacy will not charge you at pickup; your plan will bill you monthly.
- If you miss payments, you can be removed from the program (but you keep your drug coverage).
This option tends to help most for people who take high-cost drugs early in the year. If your prescriptions are inexpensive and steady, monthly billing may not be worth the added paperwork.
What this means locally
Los Angeles is in Los Angeles County, which consistently has one of the largest selections of Medicare plans in the country — both stand-alone Part D and Medicare Advantage plans that include drug coverage. That's a lot to sort through, and the new cap doesn't change which plan is right for you — it changes the ceiling on what any of them can cost you out of pocket for drugs.
If you take several prescriptions, the Annual Enrollment Period (through Dec. 7) is a good time to check that your current plan still covers your drugs at your usual pharmacy, and to look at the total expected cost — premiums plus expected out-of-pocket spending — under 2027 rules.
Free, unbiased help in L.A.
You don't have to figure this out alone, and you don't have to talk to a salesperson to get answers. California's State Health Insurance Assistance Program (SHIP) — known here as HICAP (Health Insurance Counseling and Advocacy Program) — offers free, one-on-one Medicare counseling. Los Angeles County residents can reach the local HICAP office by phone or in person.
You can also:
- Compare plans and check drug coverage at medicare.gov/plan-compare.
- Call 1-800-MEDICARE (1-800-633-4227), available 24/7.
Prescription coverage
How Medicare Part D works in 2027
The old coverage gap (“donut hole”) is eliminated as of 2025 (three phases now). There’s now a hard yearly cap of $2,100 in 2026 ($2,400 in 2027) on what you pay out of pocket for covered drugs, and you can spread those costs across the year with the Medicare Prescription Payment Plan.
Try it
How the 2026 Part D drug cap works
Slide to your estimated yearly prescription costs and see how the new $2,100 out-of-pocket cap protects you. This illustrates the standard Part D benefit; your plan may structure costs differently.
Once your out-of-pocket spending on covered drugs reaches $2,100, you pay nothing more for the rest of 2026. Confirm details at Medicare.gov.
Explore
When can you enroll? An interactive year
Enrollment windows are federal and the same nationwide. Confirm your personal dates at Medicare.gov or 1-800-MEDICARE.
Good to know
Frequently asked questions
Does the $2,100 cap include my monthly premium?
What if I take one expensive drug that costs more than $2,100 in January?
Do I have to sign up for the payment plan?
- CMS — Medicare Part D program rules (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.