Medicare drug plan members will stop paying for covered prescriptions once their own spending reaches $2,400 in 2027, up from $2,100 this year. For a member in a plan with the full $700 deductible and the standard 25% coinsurance, that point arrives after about $7,500 in covered drug costs. Medicare.gov lists both figures, and the last day to change plans for 2027 is Dec. 7.
How the $2,400 cap is reached
Medicare.gov says no drug plan may charge a deductible above $700 in 2027, compared with $615 in 2026. After the deductible, the member pays 25% of the cost of generic and brand-name drugs as coinsurance. The initial coverage stage ends when spending reaches the cap, which Medicare.gov puts at $2,100 in 2026 and $2,400 in 2027. After that, catastrophic coverage applies for the rest of the calendar year and the member pays nothing for covered drugs.
The arithmetic is simple. A member with $7,500 in covered drug costs pays the $700 deductible first. That leaves $6,800, and 25% of it is $1,700. The two add up to $2,400, the cap. This is a worked example of the standard design, not a figure Medicare.gov publishes, and it assumes a plan that charges the full deductible and no flat copays.
The people affected are anyone in a stand-alone drug plan or a Medicare Advantage plan with drug coverage. Each of them has to look up the 2027 deductible on that plan’s own page, line it up against the year’s prescriptions, and see how far the first $700 and the 25% stretch would go before Dec. 7.
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What the same math looked like in 2026
Run the 2026 numbers the same way and the cap arrived sooner. A $615 deductible, then 25% of the remaining costs, reaches $2,100 at about $6,555 in covered drug costs. In 2027 a member has to run up roughly $945 more in drug costs before the cap switches on, because the deductible and the cap both rose. CMS says in its 2027 Part D bidding instructions that it updates the statutory Part D benefit amounts every year, which is why both numbers moved.
That matters most to people on one or two expensive brand-name drugs. Someone whose medicine costs about $700 a month would owe the whole deductible on the first fill and then 25% of each refill. People on a handful of low-cost generics may never come near the cap and will care more about a plan’s premium and copays.
A lighter year looks different. A member with $3,000 in covered drug costs under the same standard design pays the $700 deductible, then 25% of the remaining $2,300, which is $575. The year ends at $1,275, well short of the cap. The cap only changes the bill for members whose drug costs climb past roughly $7,500 under the full-deductible design.
Medicare.gov also lists what counts toward the limit. On its 2026 costs page, it says the limit counts the deductible, the member’s own out-of-pocket spending and certain payments made for the member, such as Extra Help. Premiums are a separate cost and do not count toward it.
Plans can charge less than $700
The $700 is a ceiling, not a price. Medicare.gov says some plans have no deductible at all. UnitedHealthcare, which sells plans in most states, says on its Part D page that not all Part D plans will have a deductible and that what a member pays can depend on the drug tier. The same page says the $2,400 out-of-pocket maximum applies for 2027 and that the coverage stages themselves have not changed.
That is why two neighbors on the same drug can see very different first-quarter bills. One plan may charge $0 on a tier-one generic and a $590 deductible on brand drugs. Another may start everyone at the full $700. The cap protects both members at the end of the year, but the road to it differs by plan, and the $590 here is only an illustration.
Dec. 7 ends the window to change plans
Medicare.gov says Open Enrollment runs Oct. 15 to Dec. 7, and that a plan must receive the request by Dec. 7. Changes take effect Jan. 1. A member can join, drop or switch a drug plan if on Original Medicare, or switch a Medicare Advantage plan with or without drug coverage. The agency points to its Open Enrollment page and the plan comparison tool for side-by-side costs.
Medicare also offers the Medicare Prescription Payment Plan, which spreads out-of-pocket costs across monthly payments through the year. Medicare.gov says plainly that this option does not save money or lower drug costs. It changes when a member pays, not how much, so it does not replace the choice of a plan with a lower deductible.
The plan comparison tool takes a member’s drug list and pharmacy and returns each plan’s 2027 deductible, premium and estimated yearly cost. A member who enters the real list, with doses, will see whether the cap is within reach or far off, and which plan gets there for the least money.
Which 2027 drug plan costs least for these prescriptions?
A member who picks a plan on the premium alone can find a $700 deductible waiting in January, and once Dec. 7 passes the choice is set for 2027.
The 2027 Medicare Open Enrollment Decision Kit includes a cost calculator spreadsheet that compares plans on cost, drugs and doctors, along with a prescription-by-plan comparison. The 55-page kit also has a Three-Year Cost Model, so a member can see how a deductible and the $2,400 cap play out for a real drug list.
Get the drug-plan cost calculator and prescription-by-plan comparison for the $700 deductible →
This article was produced with AI assistance and edited for accuracy against the sources linked above.
