Medicare Part D
Why the Medicare Donut Hole Ends in 2026 for Stow
STOW, Ohio — If you take prescription drugs and rely on Medicare, the firm ceiling on what you pay out of pocket at the pharmacy each year — introduced in 2025 and 2026 — continues into 2027, with a higher cap. The old "donut hole" that tripped up so many people is gone for good.
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Key takeaways
- In 2027, once you spend $2,400 out of pocket on covered drugs, you pay nothing for the rest of the year on those drugs, and this cap resets every January.
- Part D deductibles can't go above $700 in 2027, and Part D now has just three phases since the "donut hole" coverage gap was eliminated.
- You can choose to spread your drug costs into monthly bills through the free, optional Medicare Prescription Payment Plan instead of paying larger amounts at the pharmacy.
- Higher earners may pay an extra IRMAA surcharge on top of their premium starting above $109,000 in income for single filers in 2026, and Social Security will notify you if this applies.
Here in Stow, which sits in Summit County, most people get their drug coverage either through a stand-alone Part D plan added to Original Medicare or built into a Medicare Advantage plan. No matter which route you take, the basic rules below apply the same way.
Here's a plain-language look at how Part D works in 2027.
The out-of-pocket cap
This is the headline change that continues into 2027. Once your out-of-pocket spending on covered prescription drugs reaches $2,400 in 2027 (up from $2,100 in 2026), you pay nothing for the rest of the calendar year on those covered drugs. The cap resets each January.
That cap is set by Medicare and applies across all Part D plans. It counts what you personally pay toward covered drugs — not your monthly premium.
For people managing expensive medications, this is a real safety net. In past years, there was no annual ceiling at all.
The maximum deductible
Every Part D plan can set its own deductible, but Medicare limits how high it can go. The maximum Part D deductible is $700 in 2027, up from $615 in 2026.
Some plans charge the full amount, some charge less, and some charge nothing at the deductible stage for certain tiers of drugs. Whatever your plan's number is, that's what you pay yourself before the plan starts sharing costs.
The three phases of Part D in 2027
Since 2025, Part D has had three phases instead of four. The old coverage gap — the "donut hole" — is officially retired. Here's how the year now flows:
1. Deductible phase. You pay the full negotiated price of your drugs until you meet your plan's deductible (up to $700 in 2027).
2. Initial coverage phase. You and your plan share the cost. You typically pay a copay or a percentage (coinsurance) for each prescription. This continues until your out-of-pocket spending reaches the $2,400 cap in 2027.
3. Catastrophic phase. Once you hit $2,400 in 2027, you pay $0 for the rest of the year on covered Part D drugs.
That's it. Three phases, one clear finish line.
The Medicare Prescription Payment Plan
Even with the cap, hitting $2,400 in January or February can sting if it lands all at once. That's why Medicare offers the Medicare Prescription Payment Plan, sometimes called "M3P" or drug cost smoothing.
It's free to join and completely optional. Instead of paying a big bill at the pharmacy, you pay nothing at the counter and your Part D plan sends you a monthly bill that spreads your yearly drug costs across the calendar year. You still owe the same amount overall — it just arrives in smaller, more predictable pieces.
You can sign up through your Part D plan at any time during the year.
A word on higher-income surcharges (IRMAA)
If your income is above certain thresholds, you may pay an extra amount on top of your Part D premium called IRMAA (Income-Related Monthly Adjustment Amount). For 2026, IRMAA surcharges start above $109,000 in income for a single filer (higher for joint filers). Social Security will notify you if you owe it, based on your most recent tax return on file with the IRS.
Key dates to remember
- October 15 – December 7, 2026: Medicare Annual Enrollment Period. This is when you can join, switch, or drop a Part D or Medicare Advantage plan for 2027.
- January 1 – March 31: Medicare Advantage Open Enrollment Period. If you're already in a Medicare Advantage plan, you get one chance to switch to another MA plan or return to Original Medicare (with a Part D plan).
Plans can change formularies, tiers, and pharmacy networks from year to year, so it's worth reading the Annual Notice of Change your plan mails each fall — even if you're happy with your coverage.
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 Summit County
(MA penetration in Summit 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”) is eliminated as of 2025 (three phases now). There's now a hard yearly cap on what you pay out of pocket for covered drugs — $2,100 in 2026 and $2,400 in 2027 — 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
Is the donut hole really gone?
Does the $2,100 cap include my monthly premium?
What if I can't afford my share before I hit the cap?
- CMS — Medicare Part D program rules (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.