Medicare Part D
$2,100: The New Part D Ceiling for Centennial Residents
CENTENNIAL, Colo. — Starting Jan. 1, 2027, Medicare Part D looks different than it did just a few years ago. The headline change: no one with a Medicare drug plan will pay more than $2,400 out of pocket for covered prescriptions in a calendar year. For people in Centennial who take costly medications, this remains one of the most significant Medicare updates in a generation.
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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.
- Every prescription checked, name by name
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Speak to a Licensed Insurance Agent
Click to call 855-729-3240Key takeaways
- In 2027, your out-of-pocket costs for covered Part D drugs are capped at $2,400 for the year.
- The Part D coverage gap (the "donut hole") has been eliminated, leaving three simpler payment phases.
- The Medicare Prescription Payment Plan lets you spread your drug costs into monthly bills instead of paying at the pharmacy counter.
- The Annual Enrollment Period runs Oct. 15 through Dec. 7, 2026, and it's the time to compare drug coverage for 2027.
The change is part of a broader overhaul of Part D under the Inflation Reduction Act. The old "donut hole" coverage gap is gone. A new payment plan can spread drug costs across the year. And these rules apply whether you get your drug coverage through a standalone Part D plan or through a Medicare Advantage plan that includes drugs.
Here is what Centennial-area readers should know as the Annual Enrollment Period runs through Dec. 7.
The $2,100 cap, in plain English
Once your out-of-pocket spending on covered prescriptions hits $2,400 in 2027, you pay nothing for the rest of the year on those drugs. That cap is set by Medicare and applies across all Part D plans, according to CMS.
A few details worth understanding:
- The cap counts what you pay for covered drugs — deductibles, copays, and coinsurance.
- It does not count your monthly premium.
- It does not count drugs your plan doesn't cover.
- The Part D deductible in 2027 can be no higher than $700.
If you take an expensive brand-name or specialty medication, you may hit the cap early in the year and then owe nothing more for covered drugs until January.
The coverage gap is really gone
For years, Part D had four phases, and the third was the dreaded "donut hole," where people paid a bigger share of drug costs in the middle of the year. That gap was eliminated as of 2025.
In 2027, Part D has just three phases:
1. Deductible phase — you pay full negotiated price until you meet your plan's deductible (up to $700 in 2027). 2. Initial coverage phase — you pay a copay or coinsurance while your plan pays the rest. 3. Catastrophic phase — once you hit $2,400 out of pocket in 2027, you pay nothing more for covered drugs that year.
That's it. No more falling into a gap partway through the year.
The Medicare Prescription Payment Plan
Even with a $2,100 cap, paying, say, $600 at the pharmacy in January can be tough on a fixed income. That's why Medicare now offers the Medicare Prescription Payment Plan — an optional program that lets you spread your out-of-pocket drug costs across the year in monthly installments.
Here's how it works:
- You still get your medications at the pharmacy.
- Your plan pays the pharmacy for your share.
- Your plan then bills you monthly for what you owe.
- You can join or leave the payment plan at any time; there is no extra fee to use it.
This program is most useful for people with high drug costs early in the year. If your out-of-pocket costs are small and steady, you may not need it. You can sign up through your Part D plan directly.
What this means locally
Centennial is in Arapahoe County, where 48 Medicare Advantage plans from 11 carriers are offered for 2027, alongside standalone Part D options. The federal rules — the $2,400 cap, the three-phase design, and the payment plan option — apply to all of them.
That said, plans still differ in which drugs they cover (their formulary), which pharmacies are in-network, and what your monthly premium and copays look like. Because those pieces vary, a sensible step during Annual Enrollment is to run your medication list through the Plan Finder at medicare.gov to see how each option would handle your prescriptions in 2027.
A quick note on IRMAA
Higher-income beneficiaries pay an extra amount, called IRMAA, on top of Part B and Part D premiums. For 2026, IRMAA begins for single filers with income above $109,000 (based on your 2024 tax return). Most people are not affected, but if you are, plan for it as you budget.
Dates to circle
- Oct. 15 – Dec. 7, 2026: Annual Enrollment Period. Join, switch, or drop Part D and Medicare Advantage plans for 2027.
- Jan. 1, 2027: New coverage begins. The $2,400 cap starts fresh.
- Jan. 1 – March 31, 2027: Medicare Advantage Open Enrollment. If you're already in a Medicare Advantage plan, you can make one change.
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 Arapahoe County
(MA penetration in Arapahoe 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.
Prescription coverage
How Medicare Part D works in 2027
The old coverage gap (“donut hole”) was eliminated as of 2025 (three phases now). There’s a hard yearly cap of $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 happens if my drug isn't on my plan's formulary?
How do I join the Medicare Prescription Payment Plan?
Where can I get free, unbiased help in Colorado?
- CMS — Medicare Part D program rules (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.
Also for Centennial
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This page was last updated: October 6, 2026.