Medicare Part D

Menifee Medicare Part D: coverage gap closes Jan. 1, 2026

MENIFEE, Calif. — As the Oct. 15 Annual Enrollment Period opens, Medicare Part D continues the overhaul that began last year. Starting Jan. 1, 2027, no one with a Part D plan will pay more than $2,400 out of pocket for covered prescription drugs in a calendar year.

For people who take costly medications, that ceiling is a meaningful change. For everyone else, it's still worth understanding — because the way you pay for drugs, and when, is different in 2027 than it was even two years ago.

Here's a plain-English look at what changed, what stayed the same, and the mistakes to avoid this fall.

The $2,400 out-of-pocket cap

In 2027, your out-of-pocket spending on covered Part D drugs is capped at $2,400 for the year, according to CMS. Once you hit that number, you pay nothing for covered prescriptions for the rest of the calendar year.

A few things to know:

• The cap applies to covered drugs on your plan's formulary. If your plan doesn't cover a medication, what you spend on it usually doesn't count toward the cap.
• The cap resets every Jan. 1.
• It applies whether your drug coverage comes through a stand-alone Part D plan or is built into a Medicare Advantage plan with drug coverage.

The Part D maximum deductible is $615 in 2026 and $700 in 2027. Plans can set a lower deductible, but not a higher one.

The coverage gap is gone

For years, the "donut hole" was one of the most confusing parts of Medicare. Once you and your plan had spent a certain amount, you fell into a coverage gap where drugs got more expensive — then eventually into catastrophic coverage, where they got cheaper again.

That structure ended in 2025. Part D now has just three phases:

1. Deductible — you pay full negotiated price until you meet the deductible (up to $700 in 2027). 2. Initial coverage — you pay a copay or coinsurance; your plan pays the rest. 3. Catastrophic coverage — once your out-of-pocket spending hits $2,400 in 2027, you pay nothing for covered drugs the rest of the year.

No more donut hole. No more sudden price jump midyear.

The Medicare Prescription Payment Plan

Even with the $2,400 cap, some people could face a big bill early in the year — for example, if an expensive prescription is filled in January.

That's what the Medicare Prescription Payment Plan is designed to soften. It's a free, optional program that lets you spread your out-of-pocket drug costs across the calendar year in monthly payments instead of paying at the pharmacy counter.

A few points worth knowing:

• You still owe the same total amount — the payment plan just changes when you pay.
• You can sign up before the year starts or at any point during the year.
• If you sign up midyear, your remaining costs are spread across the months left.
• You pay your plan directly each month; the plan pays the pharmacy.

This program tends to help most if you have high drug costs early in the year. If your prescriptions are inexpensive, it may add paperwork without much benefit.

What Menifee readers should watch during AEP

Menifee is in Riverside County, where CMS Landscape files list 68 Medicare Advantage plans from 18 carriers for 2027. Beneficiaries can compare stand-alone Part D plans and Medicare Advantage plans with drug coverage during the Annual Enrollment Period, Oct. 15 through Dec. 7. Coverage chosen during AEP starts Jan. 1, 2027.

Even with the new $2,400 cap, plans still differ in important ways:

• Which drugs are on the formulary
• Which pharmacies are considered in-network or "preferred"
• The deductible amount (from a plan-set low up to $700 in 2027)
• Monthly premiums

Because these details vary plan by plan, the only reliable way to see how your specific medications are treated is to run them through the Plan Finder at Medicare.gov or to call 1-800-MEDICARE.

Mistakes to avoid this year

• Assuming the cap means everyone pays $2,400. Most people won't reach it. The cap is a ceiling, not a target.
• Skipping the annual review. Formularies, pharmacy networks, and premiums change every year. A plan that fit in 2026 may not fit in 2027.
• Ignoring IRMAA. Higher-income beneficiaries pay a surcharge on Part B and Part D premiums. In 2026, IRMAA begins above $109,000 in income for a single filer (based on your 2024 tax return).
• Waiting past Dec. 7. Miss the deadline and you're generally locked into your current coverage for 2027, unless you qualify for a Special Enrollment Period.