Medicare Part D

Why Part D Is Changing in 2027 for St Paul Seniors

ST. PAUL, Minn. — Starting January 1, 2027, Medicare Part D will cap what most enrollees pay out of pocket for covered prescription drugs at $2,400 for the year. It's the biggest change to how seniors pay for medicine in a generation, and it lands right in the middle of Medicare's Annual Enrollment Period, which runs through December 7.

For people in St. Paul who have watched insulin, cancer pills, or specialty drug bills climb year after year, the new ceiling is a real shift. Here's a plain-language look at what's changing, what stayed, and what to check before enrollment closes.

The Part D cap, in plain English

Under Part D rules set by the Centers for Medicare & Medicaid Services (CMS), once your out-of-pocket spending on covered prescription drugs hits the annual cap, you pay nothing more for the rest of the calendar year on those covered drugs. The cap is $2,100 in 2026 and $2,400 in 2027, and it resets each January.

A few things to keep in mind:

• The cap applies to covered drugs on your plan's formulary. Drugs your plan doesn't cover don't count toward it.
• Your monthly premium doesn't count toward the $2,100 in 2026 ($2,400 in 2027).
• The cap applies whether you have a stand-alone Part D plan or a Medicare Advantage plan that includes drug coverage.

The Part D maximum deductible is $615 in 2026 and $700 in 2027, though many plans set a lower deductible.

The "donut hole" is gone

For years, Part D had a confusing middle stage called the coverage gap — the "donut hole" — where costs could spike after you and your plan hit a spending threshold. That phase was eliminated in 2025, and it stays gone in 2027.

Part D now has three straightforward stages:

1. Deductible — you pay full negotiated price until you meet the plan's deductible (up to $700 in 2027). 2. Initial coverage — you pay a copay or coinsurance for each prescription. 3. Catastrophic coverage — once you hit the yearly out-of-pocket cap ($2,400 in 2027), you pay nothing more for covered drugs that year.

No more surprise price jumps mid-year once you cross an old gap threshold. That predictability is the point.

The Medicare Prescription Payment Plan

$2,400 is a lot easier to swallow than the old system, but not everyone can absorb it in a lump — especially if a pricey specialty drug hits the pharmacy counter in January.

That's what the Medicare Prescription Payment Plan is for. It's 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 pharmacy at pickup. You still owe the same total; you just pay your plan in installments rather than the pharmacy up front.

A few points worth knowing:

• You have to opt in through your Part D or Medicare Advantage drug plan.
• It tends to help people most who face large, front-loaded drug costs early in the year.
• If you miss a monthly bill, you can be removed from the program, though your drug coverage itself continues.

You can sign up before the plan year starts or at any point during the year. If you're weighing it, ask your plan how the monthly bill would be calculated for your specific situation.

What St. Paul residents should double-check this fall

St. Paul is in Ramsey County, where the number of Part D and Medicare Advantage plans available is set at the county level by CMS. Every fall, plans can change their formularies, pharmacy networks, and cost-sharing tiers — and that matters even more now that the yearly out-of-pocket cap is in play. The 2027 lineup for Ramsey County is in each plan's Annual Notice of Change and on Medicare.gov's Plan Finder.

A few things worth reviewing during Annual Enrollment (through December 7):

• Is every prescription you take still on your plan's 2027 formulary?
• Is your preferred pharmacy still in the plan's preferred network?
• Has your plan's tier for any expensive drug changed?
• Would the payment plan help you manage January and February bills?

If your income is higher, remember that IRMAA surcharges — extra amounts added to Part B and Part D premiums — kick in above $109,000 for a single filer in 2026 (higher for joint filers). That's separate from the cap ($2,100 in 2026, $2,400 in 2027).

Key dates to keep on the fridge

• October 15 – December 7, 2026: Medicare Annual Enrollment Period. Switch, join, or drop Part D and Medicare Advantage plans for 2027.
• January 1, 2027: New $2,400 cap and 2027 plan year begin.
• January 1 – March 31: 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.