Let's set the stage. The Inflation Reduction Act passed in 2022 and put the first ever hard cap on Part D drug costs: $2,000 in 2025. The cap is indexed each year, so it became $2,100 in 2026 and is $2,400 in 2027. CMS published the 2027 figure in its CY 2027 Rate Announcement on April 6, 2026, and Medicare.gov lists it as well.
2027 Part D numbers, with 2026 for comparison
| Defined standard benefit | 2027 | 2026, for comparison |
|---|---|---|
| Deductible (maximum) | $700 | $615 |
| Your share after the deductible | 25% | 25% |
| Yearly out-of-pocket limit | $2,400 | $2,100 |
| After you reach the limit | $0 for covered drugs | $0 for covered drugs |
Plans can be more generous than the standard design. Many use flat copays instead of 25% coinsurance, and many have a lower deductible. In Utah, the 2027 CMS landscape shows stand-alone Part D plan deductibles from $300 to $700, and Salt Lake County Medicare Advantage plans with drug coverage (not counting special needs plans) from $215 to $700.
What counts toward the $2,400
- What you pay for covered Part D drugs: your deductible, coinsurance and copays.
- Certain payments made on your behalf, such as through the Extra Help program, per Medicare.gov.
- Your Explanation of Benefits shows what has counted so far.
What does not count
- Your monthly plan premium.
- Drugs your plan does not cover.
- The $50 monthly copay in the Medicare GLP-1 Bridge for weight loss drugs, which Medicare.gov says does not count toward the Part D out-of-pocket limit.
Who actually hits the cap?
Here's the thing. Most people never get close. You hit $2,400 if you take an expensive brand name drug, a specialty drug, or several brand drugs at once. For example, a person on a cancer drug or a biologic can reach it in the first month or two. Someone on one or two common brand drugs often does not. Our Eliquis and Jardiance answers walk through what one brand drug costs under the standard design.
If you get Extra Help
Extra Help (the Part D Low Income Subsidy) changes the math a lot. Under the CMS 2027 Part D parameters, Extra Help enrollees living in the community pay a $0 drug deductible and, depending on income, copays of $1.65 to $5.80 for generic drugs and $5.00 to $14.40 for other drugs, until they reach the $2,400 limit. If your income is limited, apply through Social Security before you compare plans.
Spreading the cost out
If a big drug bill would land in January, the Medicare Prescription Payment Plan lets you spread your out-of-pocket drug costs across the year in monthly payments. Medicare.gov is clear that it does not lower your total cost, it only changes the timing. Ask your plan about it.
What this means when you compare plans
The cap protects your worst case on drugs, but it does not make plans equal. Premiums, deductibles, which drugs are covered and at what tier, and the pharmacies in network all differ. 2027 formularies are being added to our data now, and when we price your list we tell you which plan year the formulary is from.
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Frequently asked questions
Is the Medicare Part D out-of-pocket maximum $2,000 or $2,400?
It was $2,000 in 2025 and $2,100 in 2026. For 2027 it is $2,400, per the CMS CY 2027 Rate Announcement and Medicare.gov.
Does the $2,400 Part D cap include premiums?
No. The cap counts what you pay for covered Part D drugs, plus certain payments made for you such as Extra Help. Monthly premiums are separate.
What is the Part D deductible in 2027?
The maximum standard Part D deductible is $700 in 2027, up from $615 in 2026. Individual plans can set a lower deductible, and insulin is not subject to the deductible.
Does the Part D cap apply to Medicare Advantage plans with drug coverage?
Yes. The out-of-pocket limit applies to Part D coverage whether it comes from a stand-alone drug plan or a Medicare Advantage plan that includes Part D.
Sources
Updated October 26, 2026 by the Everything Senior Insurance Data Desk.