Medicare Part D

Part D in Troy: 2027 Cap & Coverage Gap Ends

TROY, N.Y. — If you take prescription drugs and have Medicare, 2027 brings another step up in the out-of-pocket cap under Part D: a hard $2,400 limit on what you pay at the pharmacy for the year. That's worth understanding for households in Troy and across Rensselaer County before you pick up your next refill.

Here's a plain-language walk-through of how Part D works in 2027 — the deductible, the cap, and the three phases your drug costs move through during the year.

The big picture: Part D in 2027

Part D is the part of Medicare that helps pay for prescription drugs. You can get it two ways: as a stand-alone drug plan added to Original Medicare, or built into a Medicare Advantage plan that includes drug coverage.

Every Part D plan has to follow the same basic structure set by Medicare, even though premiums, drug lists, and pharmacy networks vary. For 2027, the structure has three phases — not four. The old "donut hole" coverage gap was eliminated starting in 2025, so it's gone for good.

Phase 1: The deductible

The first phase is the deductible. This is the amount you pay yourself before your plan starts sharing the cost.

The maximum Part D deductible is $615 in 2026 and $700 in 2027. Plans can charge less than that, and some charge nothing at all for certain tiers of drugs, but no plan can charge more than the maximum. Once you've paid the deductible, you move into the next phase.

Phase 2: Initial coverage

In this phase, you and your plan share the cost of your drugs. You'll usually pay a copay (a flat dollar amount) or coinsurance (a percentage) for each prescription. The plan pays the rest.

You stay in this phase until the amount you have paid out of pocket — the deductible plus your share of drug costs — reaches the annual cap ($2,100 in 2026, $2,400 in 2027).

Phase 3: Catastrophic coverage — the annual cap

Here's the piece that matters most: once your out-of-pocket spending on covered Part D drugs hits the annual cap — $2,100 in 2026 and $2,400 in 2027 — you're done paying for the rest of the calendar year. Your cost for covered drugs drops to $0 for the remainder of the year.

This is the annual out-of-pocket cap, and it applies to every Part D plan — stand-alone or built into Medicare Advantage. Before 2024, there was no true cap at all, so this is a meaningful protection for people on expensive medications.

A few things to know:

• The cap counts what you pay for covered drugs. Premiums don't count toward it.
• If a drug isn't on your plan's formulary (drug list), those costs generally don't count either.
• The clock resets every January 1.

The Medicare Prescription Payment Plan

If your drug costs hit hard early in the year — say a $600 copay in January — there's an option called the Medicare Prescription Payment Plan. It lets you spread your out-of-pocket drug costs across the calendar year in monthly bills instead of paying all at once at the pharmacy.

It doesn't lower what you owe overall; it just smooths it out. Enrollment is free and voluntary, and you sign up through your Part D plan. Medicare.gov has details on how to decide if it fits your situation.

Higher-income surcharges (IRMAA)

Most people pay only their plan's premium for Part D. But if your income is above a certain level, you'll pay an extra amount to Medicare called the Income-Related Monthly Adjustment Amount (IRMAA).

For 2026, IRMAA on Part D kicks in for single filers with income above $109,000 (and higher thresholds for married couples filing jointly). Social Security uses your tax return from two years earlier to figure this out and will notify you by mail if it applies.

What this means in Troy

Troy is in Rensselaer County, where Medicare beneficiaries can choose from a range of stand-alone Part D plans and Medicare Advantage plans that include drug coverage. Plan availability, drug lists, and pharmacy networks vary, so it's worth comparing before you enroll.

The Annual Enrollment Period runs October 15 through December 7 each year. That's the main window to join, switch, or drop a Part D plan for the following year. If you're in a Medicare Advantage plan, you also get a second window — the Medicare Advantage Open Enrollment Period, January 1 through March 31 — to make one change.

A common mistake to avoid

The biggest Part D mistake isn't picking the "wrong" plan — it's not reviewing your plan each fall. Drug lists change. Prices change. Your prescriptions change. A plan that fit this year may not fit in 2027. Check your Annual Notice of Change, and use Medicare's Plan Finder at medicare.gov to enter your drugs and pharmacy and compare what you'd pay under each available plan.