Medicare Part D

How Part D Works in 2026: New $2,100 Cap Explained

HALLANDALE BEACH, Fla. — If you take prescription drugs and have Medicare, 2026 brings one of the biggest changes to Part D in years. There's now a hard yearly limit on what you pay out of pocket for covered drugs, and the old "donut hole" phase is gone for good.

Here's a plain-language walk-through of how Part D works this year, what the numbers mean, and where to go for help.

The big change: a $2,100 out-of-pocket cap

Starting in 2026, you will not pay more than $2,100 out of pocket for covered prescription drugs in a calendar year. Once your spending hits that cap, you pay $0 for covered drugs for the rest of the year.

This cap applies whether you have a stand-alone Part D drug plan or a Medicare Advantage plan that includes drug coverage. The cap is a program-level rule set by Medicare — it doesn't depend on which plan you pick.

For people who take expensive medications, this is a meaningful shift. In past years, there was no upper limit at all.

The three phases of Part D in 2026

Medicare Part D used to have four phases, including the well-known "coverage gap" or donut hole. As of 2025, the donut hole is eliminated. In 2026, there are just three phases:

1. The deductible phase. You pay the full negotiated price for your drugs until you meet your plan's deductible. The maximum deductible any Part D plan can charge in 2026 is $615. Some plans set it lower, and some charge no deductible at all for certain drug tiers.

2. The initial coverage phase. After the deductible, you pay a copay or coinsurance for each prescription, and your plan pays the rest. You stay in this phase until your out-of-pocket spending reaches $2,100.

3. The catastrophic phase. Once you hit the $2,100 cap, you pay nothing for covered drugs for the rest of the calendar year.

That's it. No donut hole. No confusing middle stretch where costs suddenly spike.

The Medicare Prescription Payment Plan

If a big pharmacy bill early in the year would be hard on your budget, there's another 2026 option worth knowing about: the Medicare Prescription Payment Plan.

This is a free, optional program that lets you spread your out-of-pocket drug costs across the calendar year in monthly payments, instead of paying the full amount at the pharmacy counter. You still owe the same total — you just pay it monthly.

You can sign up through your drug plan. It doesn't lower your costs, but for some people it makes cash flow easier, especially in January when a deductible might hit.

What Hallandale Beach residents should know locally

Hallandale Beach is in Broward County, where Medicare beneficiaries generally have a wide range of stand-alone Part D plans and Medicare Advantage plans with drug coverage to choose from. Plan availability, formularies (the list of covered drugs), and pharmacy networks are set at the county level, so two neighbors on the same street will see the same menu of options.

The rules described above — the $2,100 cap, the $615 maximum deductible, the three phases — apply to every Part D plan nationwide. What varies by plan is the monthly premium, the specific drugs covered, the tier each drug sits on, and which pharmacies are considered "preferred."

A quick word on IRMAA

Most people pay only their plan's premium for Part D. But if your income is higher, you may owe an extra amount called IRMAA (Income-Related Monthly Adjustment Amount), which is added to your Part D and Part B premiums.

For 2026, IRMAA surcharges begin for single filers with income above $109,000 (and higher thresholds for joint filers). Social Security uses your tax return from two years earlier to decide whether IRMAA applies.

Key dates to remember

• October 15 – December 7: Medicare Annual Enrollment Period. This is when you can join, switch, or drop a Part D or Medicare Advantage plan for the following year.
• January 1 – March 31: Medicare Advantage Open Enrollment Period. If you're already in a Medicare Advantage plan, you can switch to another one or return to Original Medicare (and add a stand-alone Part D plan).

Outside these windows, you generally need a Special Enrollment Period — for example, if you move or lose other coverage.