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Medicare Part D
Prescription Drug Coverage 2027
Medicare Part D Out-of-Pocket Maximum 2027: The $2,400 Cap
Reviewed by Russell Noga, Licensed Medicare Insurance Broker (all 50 states) — Last updated October 29, 2026
The Medicare Part D out-of-pocket maximum for 2027 is $2,400, up from $2,100 in 2026. Once your own spending on covered drugs reaches $2,400, you pay $0 for covered Part D prescriptions for the rest of the calendar year.
2027 by the Numbers
$2,400
2027 annual cap on Part D drug costs (CMS)
$2,100
2026 cap (CMS)
$7,500
total covered drug cost that triggers the cap on a standard plan (our math)
$0
what you pay for covered drugs after the cap (CMS)
Until 2024, Medicare drug coverage had no true ceiling: people on cancer drugs or other specialty medicines kept paying a share of the bill all year. The Inflation Reduction Act changed that, and starting in 2025 every Part D plan, standalone or inside a Medicare Advantage plan, has a hard annual cap. For 2027 that cap is $2,400.
Here is what the 2027 cap includes, what it leaves out, roughly when different drug bills reach it, and how it fits with the rest of the Medicare Part D plans 2027 changes. For the first stage of the year, see our Medicare Part D deductible 2027 guide.
Key Takeaways
- The 2027 Part D out-of-pocket cap is $2,400, $300 more than in 2026.
- Your deductible, copays and coinsurance on covered drugs all count; premiums do not.
- After the cap you pay nothing for covered Part D drugs until December 31, 2027.
- The cap applies to every Part D plan and every Medicare Advantage plan with drug coverage.
- The cap resets each January 1, along with the $700 deductible.
What Is the Part D Out-of-Pocket Maximum for 2027?
The out-of-pocket maximum, which Medicare calls the out-of-pocket threshold, is the most you can be charged in a year for drugs your plan covers. CMS raises it each year by the growth in Part D spending per person. It was $2,000 in 2025, $2,100 in 2026 and is $2,400 for 2027.
| Year | Out-of-pocket cap | Maximum deductible | What happens at the cap |
|---|---|---|---|
| 2024 | about $3,300 (then 5% ended) | $545 | Catastrophic coverage, $0 after |
| 2025 | $2,000 | $590 | $0 for covered drugs |
| 2026 | $2,100 | $615 | $0 for covered drugs |
| 2027 | $2,400 | $700 | $0 for covered drugs |
Source: CMS Part D benefit parameters. 2024 was the first year the 5% catastrophic coinsurance was removed.
The cap is set by law, so it is the same in every state and every plan. What differs from plan to plan is how quickly you get there: a plan with lower copays can actually take longer to reach the cap because each fill costs you less.
What Counts Toward the $2,400 Cap
Counts toward the cap
✔
Your deductible payments
✔
Copays and coinsurance on covered drugs
✔
Payments made for you by Extra Help, a State Pharmaceutical Assistance Program, an AIDS drug assistance program or the Indian Health Service
✔
Help from family members or most charities
Does not count
✔
Your monthly plan premium
✔
Drugs not on your plan’s formulary
✔
Drugs bought outside the plan’s rules or network
✔
Over-the-counter medicines
✔
Drugs covered under Part B
Watch for: if you pay cash for a drug outside your plan, for example with a discount card, that spending usually does not count toward your Part D cap. Run covered drugs through your plan so they add up.
When Will You Reach the 2027 Cap?
On a standard plan, you pay the first $700 yourself, then 25% of each drug’s cost. To reach $2,400 you need $1,700 more in coinsurance, which takes $6,800 of drug spending after the deductible. Add the first $700 and the cap arrives once your covered drugs total $7,500 for the year. See the Medicare Part D formulary 2027 guide to check where your drugs sit.
| Monthly drug cost (plan price) | Month you hit the cap | Your 2027 total |
|---|---|---|
| $300 | Not reached | $1,425 |
| $625 | December | $2,400 |
| $1,000 | August | $2,400 |
| $2,500 | March | $2,400 |
| $7,500 or more | January | $2,400 |
Our calculation from the CMS 2027 standard benefit ($700 deductible, 25% coinsurance, $2,400 cap). Plans with tier copays will differ; premiums not included.
Specialty drugs for cancer, multiple sclerosis or rheumatoid arthritis often cost several thousand dollars a month, so many people taking them reach the 2027 cap in the first quarter.
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Spreading the $2,400 Over the Year
Reaching the cap in January or February means paying up to $2,400 at the pharmacy in a few weeks. The Medicare Prescription Payment Plan lets you pay those costs in monthly bills from your plan instead.
$0
Cost to join the payment plan
$200
Most you would be billed in a month if you join in January and your costs total $2,400
Auto
2026 members re-enrolled for 2027 if they keep the same plan
Worth knowing: the payment plan does not reduce what you owe. It is most useful when your drugs are expensive enough to hit the cap early in the year; for small bills, paying at the counter is simpler.
Does the Cap Apply to Medicare Advantage Plans?
Yes. If your Medicare Advantage plan includes Part D drug coverage, the same $2,400 drug cap applies. It is separate from the plan’s maximum out-of-pocket for medical care, which covers doctor and hospital costs and has its own, much higher, limit.
Two different limits in an MA plan
✔
Drug cap: $2,400 in 2027, the same for every plan
✔
Medical MOOP: set by each plan, up to the federal limit for in-network care
✔
Neither limit includes your monthly premium
✔
Reaching one does not count toward the other
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What the Higher 2027 Cap Means for You
For people who already reached the cap in 2026, the 2027 increase means up to $300 more in drug costs before coverage becomes free. Combined with the end of the premium stabilization program, which held standalone premiums down in 2025 and 2026, total yearly costs may rise for some enrollees, depending on the plan.
Who feels the change most
✔
People on one or more specialty drugs
✔
People on several brand-name drugs without lower-cost alternatives
✔
People who switch plans and land on a formulary that puts their drug on a higher tier
Fifteen drugs, including Ozempic, Wegovy, Trelegy Ellipta and Xtandi, get Medicare-negotiated prices on January 1, 2027. A lower plan price on those drugs can mean a lower 25% share and a slower path to the cap.
How to Estimate Your 2027 Out-of-Pocket Costs
1
List every prescription with dose and quantity. Include drugs you take only part of the year.
2
Enter them in Medicare Plan Finder. It shows each plan’s estimated yearly drug cost for 2027 and the month you would reach the cap.
3
Add 12 months of premiums. The cap ignores premiums, so a plan’s real yearly cost is premiums plus drug costs.
4
Compare before December 7, 2026. The plan you choose during Annual Enrollment starts January 1, 2027.
Tip: if you expect to reach the cap anyway, the plan with the lowest premium that covers all your drugs is often the cheapest overall, since everyone’s drug costs stop at $2,400.
Our Part D plans by state 2027 table shows how many standalone plans you can compare.
The Bottom Line
The Bottom Line
The 2027 Part D out-of-pocket maximum is $2,400, and after you reach it your covered drugs cost $0 through December 31. Premiums are not included, so compare each plan’s premiums plus estimated drug costs before the December 7, 2026 deadline.
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY 1-877-486-2048) to get information on all of your options.
Frequently Asked Questions
➤ What is the Medicare Part D out-of-pocket maximum for 2027?
It is $2,400, up from $2,100 in 2026. After your spending on covered drugs reaches $2,400, you pay $0 for covered Part D drugs for the rest of 2027.
➤ Do premiums count toward the $2,400 cap?
No. Only your payments for covered drugs, such as the deductible, copays and coinsurance, count. You keep paying your monthly premium after reaching the cap.
➤ Does the $2,400 cap reset every year?
Yes. It resets on January 1. Spending in 2026 does not carry into 2027.
➤ Is the Part D cap the same in every plan?
Yes. The $2,400 cap is set by Medicare and applies to every standalone Part D plan and every Medicare Advantage plan with drug coverage.
➤ How much do my drugs have to cost to hit the cap?
On a standard plan, about $7,500 in total covered drug costs for the year triggers the $2,400 cap. Plans with copays instead of coinsurance can differ.
➤ Do drugs paid with a discount card count?
Usually not. Drugs bought outside your plan, including with most discount cards, do not count toward the Part D out-of-pocket cap.
➤ Does Extra Help count toward the cap?
Yes. Amounts Extra Help pays toward your drug costs count toward the out-of-pocket threshold, along with payments from state pharmacy assistance programs.
➤ What happens after I reach the cap?
You enter catastrophic coverage and pay $0 for covered Part D drugs until December 31. Drugs not on your formulary are still not covered.
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