Medicare Part D
2027 Part D cap in Cheyenne, Wyo.
CHEYENNE, Wyo. — Starting Jan. 1, 2027, people with Medicare Part D drug coverage will have a new out-of-pocket ceiling for prescriptions: $2,400 a year. It's the next step in a multi-year overhaul of how Medicare handles drug costs, and it lands right as Cheyenne residents sort through their choices during the Annual Enrollment Period, which runs through Dec. 7.
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Key takeaways
- Starting Jan. 1, 2027, Medicare Part D out-of-pocket drug spending is capped at $2,400 a year, after which covered drugs cost nothing more for the rest of the year.
- The old coverage gap, or "donut hole," is gone as of 2025, and the 2027 deductible can be no more than $700.
- A free, optional Medicare Prescription Payment Plan lets you spread your out-of-pocket drug costs into monthly payments instead of paying it all at the pharmacy, and you can join any time during the year.
- The Annual Enrollment Period runs Oct. 15 through Dec. 7, and it's worth checking your plan since formularies, pharmacy networks, and costs can change even though the $2,400 cap and $700 deductible limit apply nationwide in 2027.
Here's a plain-language look at what's changing, what stays the same, and where to get help you can trust.
The headline change: a Part D out-of-pocket cap
For 2027, once you've spent $2,400 out of pocket on covered prescription drugs under Part D, you pay nothing more for the rest of the calendar year for those covered drugs. This cap applies whether your drug coverage comes through a stand-alone Part D plan or a Medicare Advantage plan that includes drug coverage.
A few things worth knowing:
- The cap only counts money you actually spend on covered Part D drugs (deductibles, copays, and coinsurance). Monthly premiums don't count toward it.
- Drugs your plan doesn't cover don't count either.
- The cap resets every Jan. 1.
This is a big shift from just a few years ago, when there was no annual limit at all on what a person could spend at the pharmacy counter.
The "donut hole" is gone
If you've been on Medicare for a while, you probably remember the coverage gap — nicknamed the "donut hole" — where your share of drug costs jumped in the middle of the year. That gap was eliminated as of 2025.
Part D now has just three phases:
1. Deductible phase — you pay full negotiated price until you meet your plan's deductible (no more than $700 in 2027). 2. Initial coverage phase — you pay a copay or coinsurance; your plan pays the rest. 3. Catastrophic phase — once your out-of-pocket spending hits $2,400, you pay nothing more for covered drugs the rest of the year.
That's it. Simpler than it used to be.
The Medicare Prescription Payment Plan: spreading costs over the year
Even with the new cap, $2,400 all at once — or a big bill in January when the deductible resets — can be tough on a fixed income. That's where the Medicare Prescription Payment Plan comes in.
This is a free, optional program (sometimes called "M3P") that lets you spread your out-of-pocket drug costs across the calendar year in monthly payments instead of paying the pharmacy in full at pickup. You still owe the same total amount — nothing is forgiven — but the timing is smoother.
A few points to keep in mind:
- You opt in through your drug plan, not through Medicare directly.
- Once you're enrolled, you pay $0 at the pharmacy for covered drugs and get a monthly bill instead.
- It tends to help people most who have high costs early in the year or a few expensive medications.
- If your drug costs are low, this program may not be useful — and could feel like extra paperwork.
You can enroll any time during the year, not just during AEP.
What this means for Cheyenne
Cheyenne is in Laramie County, where Medicare beneficiaries choose from Part D and Medicare Advantage options approved for that county. Plan availability, formularies (the list of covered drugs), and pharmacy networks are set at the county level, so two people living in different Wyoming counties may see different sets of plans on Medicare.gov.
The 2027 rules — the $2,400 cap, the $700 maximum deductible, and access to the payment plan — apply the same way nationwide. But the specific plan you're in still shapes your day-to-day experience: which drugs are covered, which pharmacies are in network, and what your monthly premium looks like.
That's why the Annual Enrollment Period (Oct. 15–Dec. 7) matters. Even if your plan worked fine this year, formularies and costs can shift for 2027. Details for your current plan are in its Annual Notice of Change, and the full 2027 lineup is on Medicare.gov's Plan Finder. It's worth a look.
A quick word on IRMAA
Higher-income beneficiaries pay an extra amount on top of their standard Part B and Part D premiums — that's the Income-Related Monthly Adjustment Amount (IRMAA). For 2026, IRMAA kicks in above $109,000 in income for a single filer (and higher thresholds for joint filers). Social Security uses your tax return from two years ago to decide. If your income has dropped since then — say, from retirement — you can ask Social Security to reconsider.
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 Laramie County
(MA penetration in Laramie 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.
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
Does the $2,100 cap include my monthly plan premium?
If I sign up for the Medicare Prescription Payment Plan, will I save money?
When can I switch drug plans for 2027?
- CMS — Medicare Part D program rules (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.