Medicare Part D out-of-pocket cap rises to $2,100

Medicare Part D's annual out-of-pocket spending cap moved to $2,100 for 2026, up from $2,000 in 2025, under the drug-pricing provisions of the Inflation Reduction Act ^[1]. Once a Part D enrollee's out-of-pocket spending on covered medications reaches that amount, the plan pays 100% of the cost of covered drugs for the rest of the calendar year ^[1].

The $2,100 figure is part of a broader redesign of Part D that took effect in 2025. Before that, enrollees had to spend $8,000 out of pocket in 2024 to reach the "catastrophic coverage" phase where costs stopped ^[1]. The coverage gap once known as the "donut hole" was eliminated on Dec. 31, 2024, cutting Part D down from four coverage phases to three: deductible, initial coverage, and catastrophic coverage ^[1].

Other numbers are also shifting for 2026. The maximum allowed deductible rises to $615, up from $545 in 2024 ^[1]. During the initial coverage phase, enrollees pay copays and coinsurance until their out-of-pocket spending — not counting manufacturer discounts, but including anything paid through the Extra Help low-income subsidy — reaches the $2,100 cap ^[1]. According to GoodRx, the cap is scheduled to be adjusted annually going forward based on inflation, though this source does not spell out the exact dollar figure for 2027 ^[1].

The cap applies the same way whether someone has a stand-alone Part D plan or prescription coverage bundled into a Medicare Advantage plan ^[1]. A separate, voluntary option called the Medicare Prescription Payment Plan lets enrollees spread their out-of-pocket drug costs across monthly bills throughout the year instead of paying it all up front at the pharmacy; there is no cost to join, but participants must opt in and re-enroll each year ^[1].

Why it matters for patients

For Medicare Part D enrollees who take expensive prescription drugs, hitting the $2,100 threshold earlier in the year means their plan starts covering 100% of the remaining year's costs for covered medications sooner than it would have before 2025, when the threshold was $8,000 ^[1]. GoodRx notes this change is most helpful to people who actually spend that much on drugs each year; enrollees whose annual prescription costs stay under $2,100 won't see much difference from the cap itself ^[1].

The source reviewed here does not specify how GLP-1 medications for diabetes or obesity are treated under this cap, so it is not known from this source whether coverage, prior authorization, step therapy, or quantity limits for these drugs change under the new limit. Those coverage restrictions, which GoodRx says are common in Medicare Advantage plans with drug coverage, can still affect whether and how quickly someone reaches their out-of-pocket cap ^[1].

Because plans differ, Part D enrollees are advised by GoodRx to review their plan's Annual Notice of Change, which insurers must send by Sept. 30 each year, and to check the plan's formulary and pharmacy network before deciding on 2026 coverage ^[1].

What happens next

Medicare's annual open enrollment period ran from Oct. 15 to Dec. 7, 2025, giving enrollees a window to switch plans for 2026 coverage ^[1]. Anyone who joined the Medicare Prescription Payment Plan during that window had their participation begin Jan. 1, 2026; enrollment in the payment plan otherwise remains open throughout the year ^[1]. Because the out-of-pocket cap is set to keep changing with inflation each year, its exact 2027 level was not detailed in the source reviewed for this article ^[1].