Medicare Part D changes for 2027: the $2,400 cap, the $700 deductible, and why your premium may rise

What is the Part D out-of-pocket cap for 2027?

$2,400. Once your spending on drugs covered by your plan reaches that amount in a calendar year, you pay nothing for covered drugs through December 31. The count resets on January 1.

The cap counts your deductible, copays, and coinsurance for covered Part D drugs, plus certain payments made on your behalf. It does not count your monthly premium, drugs your plan doesn’t cover, drugs you buy outside your plan, or medications billed under Part B, such as most infusions given in a doctor’s office.

This is the third year of the cap, which the Inflation Reduction Act created in 2025 at $2,000. It rises each year with Part D spending growth: $2,100 in 2026, $2,400 in 2027.

Why did the deductible go up more than usual?

The standard deductible moves by the same formula as the cap. Because Part D spending grew faster in the year CMS measured, both numbers rose about 14 percent instead of the roughly 5 percent they rose last year.

Two things soften this. First, the $700 is a ceiling: plans can set a lower deductible or none at all. Second, most plans exempt generic tiers from the deductible, so you only feel it on brand-name drugs. Whether your plan does that for 2027 is printed in your Annual Notice of Change.

Why might my drug plan premium jump for 2027?

For 2025 and 2026, CMS ran a Premium Stabilization Demonstration that paid stand-alone drug plans a subsidy and limited how much a plan’s premium could rise year over year. CMS announced in July 2026 that the program ends after 2026, saying plans now have enough experience with the redesigned benefit to price it themselves.

The national base beneficiary premium, $41.33 for 2027, is a benchmark used for penalties and income surcharges. It is not what any specific plan charges. Individual stand-alone plan premiums can move well above or below it, and with fewer stand-alone plans on the market, some enrollees will be moved to a different plan altogether.

Medicare Advantage members are mostly insulated because their drug benefit is bundled into the medical plan, which CMS funds differently.

What to do with your Annual Notice of Change

1. Find the 2027 premium and deductible, and which tiers the deductible applies to.
2. Check every medication you take: still covered, same tier, any new prior authorization or quantity limit.
3. Confirm your pharmacy is still preferred, and compare mail order.
4. Add it up as total annual cost: twelve premiums plus your medications through each phase, and the month you’d reach $2,400.
5. Compare that number to the other plans in your ZIP code before December 7.

Which drugs get negotiated prices in 2027?

Fifteen drugs join the ten already priced in 2026: Ozempic, Rybelsus, and Wegovy (one negotiation), Trelegy Ellipta, Xtandi, Pomalyst, Ibrance, Ofev, Linzess, Calquence, Austedo and Austedo XR, Breo Ellipta, Tradjenta, Xifaxan, Vraylar, Janumet and Janumet XR, and Otezla.

A negotiated price lowers what your plan pays. What you pay depends on the tier your plan assigns and whether your deductible applies, so the same drug can cost different amounts on two plans. Plans can still require prior authorization.

Does the Medicare Prescription Payment Plan change?

The rules stay the same. You pay $0 at the pharmacy and your plan bills you monthly, with no fees or interest; it spreads your costs, it doesn’t lower them. If you were enrolled in 2026 and stay in the same plan, you are renewed automatically for 2027 unless you opt out. If you switch plans, you have to elect it again with the new plan.