Medicare Part D
Part D in Silver Spring: 2027 Cap & Gap's End
SILVER SPRING, Md. — Starting Jan. 1, 2027, Medicare's Part D prescription drug program continues the shape it took on last year. The out-of-pocket ceiling for covered drugs is rising to $2,400, the old "donut hole" coverage gap remains gone, and a payment option that spreads drug costs across the year is now in its third year. If you take expensive medications — or worry you might one day — these changes matter.
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Click to call 855-729-3240Key takeaways
- Starting January 1, 2027, Medicare's Part D out-of-pocket cap for covered drugs rises to $2,400 for the year, up from $2,100 in 2026, and it resets every January 1.
- The old "donut hole" coverage gap is gone, leaving just three phases: deductible, initial coverage, and catastrophic coverage where you pay nothing more once you hit the annual cap.
- The Medicare Prescription Payment Plan, now in its third year, is a free option that lets you spread your out-of-pocket drug costs into monthly payments instead of paying it all at the pharmacy.
- During the Annual Enrollment Period (Oct. 15 – Dec. 7, 2026), it's worth checking your plan's formulary and pharmacy network since premiums and drug coverage still vary even though the 2027 cap and rules apply to all plans.
Here's a plain-language look at what's new for 2027 and how to think about it during this fall's Annual Enrollment Period (Oct. 15 – Dec. 7, 2026).
The Part D out-of-pocket cap, explained
For 2027, Medicare caps what you pay out of pocket for covered Part D drugs at $2,400 for the year, according to CMS. Once your out-of-pocket spending on covered prescriptions hits that number, you pay nothing more for the rest of the calendar year on covered drugs at the pharmacy.
That's up from the $2,100 cap in 2026, which itself followed the $2,000 cap that took effect in 2025. The cap resets every Jan. 1.
A few things worth knowing:
- The cap applies to drugs covered by your Part D plan (or the Part D portion of a Medicare Advantage plan). Drugs your plan doesn't cover don't count toward it.
- Premiums do not count toward the $2,100 in 2026 ($2,400 in 2027). Only your deductible, copays, and coinsurance for covered drugs do.
- The Part D maximum deductible is $615 in 2026 and $700 in 2027, though many plans set theirs lower.
What "the end of the coverage gap" actually means
For nearly two decades, Part D had a confusing middle phase called the coverage gap — the "donut hole" — where you paid more out of pocket after hitting a certain spending level, then less again after hitting another. It tripped up a lot of people.
That gap was eliminated in 2025. There are now just three phases of Part D:
1. Deductible phase — you pay full price (up to the plan's deductible, if it has one). 2. Initial coverage phase — you pay copays or coinsurance until you reach the annual out-of-pocket cap. 3. Catastrophic phase — you pay nothing more for covered drugs the rest of the year.
That's it. No more donut hole math.
The Medicare Prescription Payment Plan
Hitting the annual ceiling is helpful, but $2,400 in January is still a lot of money at once. That's where the Medicare Prescription Payment Plan comes in.
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're just paying your Part D plan monthly rather than paying the pharmacy up front.
A few practical notes from Medicare.gov:
- You have to opt in — it isn't automatic. You can sign up before the year starts or any time during the year.
- It tends to help people most who have high drug costs early in the year, or a single expensive prescription that would otherwise be a big hit at the counter.
- If your drug costs are low or spread evenly, the payment plan may not change much for you.
You can enroll through your Part D or Medicare Advantage drug plan directly.
What this looks like in Silver Spring
Silver Spring is in Montgomery County, where Maryland Medicare beneficiaries choose from a range of stand-alone Part D plans and Medicare Advantage plans that include drug coverage. The 2027 rules — the $2,400 cap, the $700 maximum deductible, the three-phase design, the payment plan option — apply to all of them, no matter which plan or carrier you're with. The carrier counts shown below reflect 2026; the 2027 lineup will appear in each plan's Annual Notice of Change and on Medicare.gov's Plan Finder.
Formularies (the list of drugs each plan covers), pharmacy networks, and monthly premiums still vary from plan to plan, which is why the Annual Enrollment Period is a good time to check that your specific medications are still covered the way you expect.
Higher-income enrollees: a quick IRMAA note
If your 2024 income was above $109,000 as a single filer (or $218,000 for a married couple filing jointly), you may pay an income-related surcharge (IRMAA) on top of your Part D premium in 2026. That surcharge is separate from your drug costs and does not count toward the cap ($2,100 in 2026, $2,400 in 2027). Social Security notifies you directly if IRMAA applies.
Dates to keep on your calendar
- Oct. 15 – Dec. 7, 2026: Medicare Annual Enrollment Period. You can join, switch, or drop a Part D or Medicare Advantage plan for 2027.
- Jan. 1, 2027: New coverage and the $2,400 cap take effect.
- Jan. 1 – March 31, 2027: Medicare Advantage Open Enrollment. If you're in a Medicare Advantage plan, you get one chance to switch to another MA plan or return to Original Medicare with a stand-alone Part D plan.
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 Montgomery County
(MA penetration in Montgomery 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 in 2025 (three phases now). The yearly cap on what you pay out of pocket for covered drugs is $2,400 in 2027 (up from $2,100 in 2026), 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 annual cap include drugs I buy without insurance?
If I sign up for the monthly payment plan, do my drugs get cheaper?
What happens to money I already spent toward the cap if I switch plans mid-year?
- CMS — Medicare Part D program rules (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.