Medicare Part D

The $2,400 Part D Cap in Columbia, TN (2027)

By the numbers

Columbia, Tenn. — A big change continues for Medicare drug plans in 2027

Starting January 1, 2027, every Medicare Part D drug plan will carry a hard limit on what you pay out of pocket for covered prescriptions. That cap is $2,400 for the year. Once you hit it, you pay $0 for the rest of 2027 on covered drugs at the pharmacy.

For folks here in Columbia weighing their choices during Medicare's Annual Enrollment Period — running now through December 7 — this is one of the most meaningful shifts Part D has seen in years. Here is what it means in plain language.

The Part D cap, explained

Under 2027 Part D rules set by the Centers for Medicare & Medicaid Services (CMS), your yearly out-of-pocket spending on covered prescription drugs cannot go above $2,400. That includes what you pay toward your deductible and your share of drug costs after that.

A few things to keep in mind:

• The cap applies to covered drugs from your plan's formulary bought at an in-network pharmacy.
• Your monthly premium does not count toward the $2,100 in 2026 ($2,400 in 2027).
• The Part D deductible in 2027 can be no higher than $700, though plans may set it lower.

If you take costly brand-name medications, this cap can bring real predictability to your budget. If you take only inexpensive generics, you may never come close to it — and that is fine, too.

The "donut hole" is gone

For years, Medicare's coverage gap — the so-called donut hole — confused just about everyone. You would pay one amount, then suddenly pay more once you crossed a threshold, then less again after "catastrophic" coverage kicked in.

That middle phase was eliminated in 2025. In 2027, Part D has just three simple phases:

1. Deductible phase — you pay full negotiated price until you meet the plan's deductible (up to $615 in 2026 ($700 in 2027)). 2. Initial coverage phase — you pay a share of the cost (a copay or coinsurance) until your out-of-pocket spending hits $2,100 in 2026 ($2,400 in 2027). 3. Catastrophic phase — you pay $0 for covered drugs the rest of the year.

No more donut hole math. It is a cleaner design.

The Medicare Prescription Payment Plan

Even with a cap ($2,100 in 2026, $2,400 in 2027), hitting a large pharmacy bill in January can sting. That is why CMS created the Medicare Prescription Payment Plan, sometimes called "M3P."

Here is how it works:

• It is optional and free to join.
• Instead of paying the pharmacy at the counter, your drug costs are billed to you by your Part D plan in monthly installments spread across the calendar year.
• You do not pay more overall — it just smooths the timing.
• You can sign up before the year starts or during the year. The earlier in the year you enroll, the more months your costs are spread across.

This can help if you have a big prescription cost early in the year, or if a fixed monthly bill is easier on your budget than an unpredictable pharmacy total.

Ask your plan directly how to enroll. Every Part D plan and every Medicare Advantage plan with drug coverage has to offer it.

What this means locally

Columbia sits in Maury County, where Medicare beneficiaries have a range of stand-alone Part D drug plans and Medicare Advantage plans that include drug coverage to compare. All of them — no matter the carrier — must follow the same 2027 rules: the $2,400 cap, the $700 maximum deductible, and access to the payment plan. For the 2027 lineup serving your area, check each plan's ANOC and Medicare.gov's Plan Finder.

What can differ from plan to plan is the formulary (which drugs are covered and at what tier), the pharmacy network, the monthly premium, and the deductible. Two plans can both follow the rules and still cost you very different amounts, depending on the medications you take.

That is why comparing plans on medicare.gov's Plan Finder — using your actual drug list and your regular pharmacy — matters more than any general advice.

A word on higher-income beneficiaries

If your income was above $109,000 as a single filer (or $218,000 filing jointly) on your 2024 tax return, you may pay an IRMAA surcharge on top of your Part B and Part D premiums in 2026. Social Security will notify you if this applies. It does not change the cap ($2,100 in 2026, $2,400 in 2027), but it does affect your monthly cost.