Medicare Part D

$2,400 Drug Cap and Payment Plan: Medicare in Merrimack

Merrimack, N.H. — On Jan. 1, 2027, the Medicare Part D cap on what enrollees pay out of pocket for covered prescription drugs rises to $2,400 for the year, up from $2,100 in 2026. For people in Merrimack who take costly medications, it's worth understanding before the Annual Enrollment Period ends Dec. 7.

Here's what's changing, what's staying, and how to think through your choices this fall.

The $2,100 cap, in plain English

The Part D out-of-pocket cap is $2,100 in 2026 and $2,400 in 2027. Once your out-of-pocket spending on covered Part D drugs hits that amount, you pay nothing more for the rest of the calendar year on those drugs. The limit resets every January.

A few important details from Medicare:

• The cap applies to what you pay for covered drugs — deductibles and copays or coinsurance count toward it.
• Monthly plan premiums do not count toward the cap.
• Drugs your plan doesn't cover don't count either. That's one reason it pays to check whether your medications are on a plan's formulary.

The Part D maximum deductible for 2026 is $615, though many plans set theirs lower. After the deductible, you pay a share of drug costs until you reach $2,100, then coverage kicks in fully.

The "donut hole" is gone

If you've been on Medicare a while, you probably remember the coverage gap — the so-called donut hole where costs jumped in the middle of the year. That phase was eliminated in 2025.

Part D now has just three phases:

1. Deductible (if your plan has one) 2. Initial coverage, where you pay a share of costs 3. Catastrophic coverage, where you pay nothing for covered drugs after hitting the annual cap

That's simpler than the old four-phase design, and it means no more mid-year sticker shock for people on expensive medications.

The Medicare Prescription Payment Plan

Even with a yearly ceiling on out-of-pocket drug costs, hitting a big pharmacy bill in January or February can hurt. 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 year in monthly payments to your plan, instead of paying the pharmacy at pickup. You still owe the same total — it's not a discount — but the bill arrives in more manageable pieces.

It may be worth considering if:

• You have a high-cost drug early in the year.
• Your costs are uneven month to month.
• You expect to hit the annual out-of-pocket cap.

It may not help much if your drug costs are low and steady. You can opt in through your Part D or Medicare Advantage drug plan; details are on medicare.gov.

What this means for Merrimack residents

Merrimack is in Hillsborough County, where multiple stand-alone Part D plans and Medicare Advantage plans with drug coverage were offered for 2026. The 2027 lineup is listed in each plan's Annual Notice of Change and on Medicare.gov's Plan Finder. Availability, formularies, and pharmacy networks vary by plan, so the "right" fit really is personal.

A few things to check during Annual Enrollment (Oct. 15 – Dec. 7):

• Are all your medications on the plan's formulary for 2027?
• Is your pharmacy in the plan's preferred network?
• What is the plan's deductible, and how does it apply to your drugs?
• If you're on Medicare Advantage, does the plan's drug coverage still make sense given your prescriptions?

If you're already on Medicare Advantage, you also get the Medicare Advantage Open Enrollment Period from Jan. 1 – March 31 to make a one-time switch.

A quick note on higher-income enrollees

If your income is above $109,000 as a single filer (or $218,000 filing jointly) based on your 2024 tax return, you may owe an IRMAA surcharge on top of your Part B and Part D premiums in 2026. The $2,100 cap still applies to you — IRMAA is a premium adjustment, not a change to out-of-pocket drug limits.