How you get Part D
- Stand-alone drug plan (PDP) alongside Original Medicare (with or without Medigap).
- Medicare Advantage plan with drug cover (MA-PD). Most Medicare Advantage plans include it.
Costs for 2026 and 2027
| 2026 | 2027 | |
|---|---|---|
| Annual out-of-pocket cap | $2,100 | $2,400 |
| Maximum standard deductible | $615 | $700 |
| Average stand-alone premium | $35.09 | about $36 |
| Average Medicare Advantage drug deductible | – | about $509 (projected) |
Sources: CMS; NCOA; reporting of Medicare Market Insights projections.
Once your spending on covered drugs reaches the cap, you pay nothing more for covered drugs that year. Covered insulin is limited to $35 a month. Premiums don’t count toward the cap.
2027 changes to watch
- More than a million people’s stand-alone drug plans are ending, so they must choose a new plan by December 7.
- CMS projects average premiums will rise less than $1, but some plans are raising premiums by more than $50 a month.
- KFF found no stand-alone plan will offer a $0 premium for people without Extra Help.
Spreading costs: the Prescription Payment Plan
The Medicare Prescription Payment Plan lets you pay drug costs in monthly installments over the year instead of all at once at the pharmacy. It’s free to join and can help if you have expensive drugs early in the year. Participants are renewed automatically unless they opt out.
Extra Help
Extra Help (the Low-Income Subsidy) lowers premiums, deductibles and copays for people with limited income and resources, and removes the late enrollment penalty. If you qualify for Medicaid or a Medicare Savings Program, you usually qualify automatically. Apply through Social Security.
The late enrollment penalty
If you go 63 days or more without Part D or other creditable drug cover after your Initial Enrollment Period, you’ll pay a penalty of 1% of the national base premium for each full month without cover, usually for as long as you have Part D. Keep proof of any employer or union drug cover; see our enrollment guide.
How to compare drug plans
- List every prescription, with dose and how often you take it.
- Use the Medicare Plan Finder at Medicare.gov to see each plan’s estimated yearly cost for your drugs, not just the premium.
- Check the formulary tier and any prior authorization, step therapy or quantity limits.
- Check preferred pharmacies; prices can be lower at some pharmacies or by mail order.
- Look at star ratings; stand-alone drug plans averaged 3.22 stars for 2027.
- Review again every year. Formularies and prices change; see our open enrollment checklist.
Frequently asked questions
What is the Part D out-of-pocket cap for 2027?
$2,400, up from $2,100 in 2026. After you reach it, covered drugs cost nothing for the rest of the year.
How much does Part D cost?
Stand-alone plans average about $36 a month in 2027, but premiums vary widely, and you may also pay a deductible of up to $700.
Is there a penalty for not having Part D?
Yes. If you go 63 days or more without creditable drug cover, you pay 1% of the national base premium for each month without cover, usually for life.
What is Extra Help?
A federal program that lowers drug plan premiums and costs for people with limited income and resources, and waives the late penalty.
How do I find the cheapest Part D plan?
Enter your prescriptions in the Medicare Plan Finder at Medicare.gov and compare estimated total yearly costs, not just premiums.
Sources
- Becker’s Hospital Review – CMS final 2027 rate announcement
- CMS – Medicare Advantage and Part D expected to remain stable in 2027 (Sept 2026)
- NCOA – Updates to Medicare Part D for 2026
- Holland & Knight – CMS finalizes CY 2027 Medicare Advantage and Part D rule
- Straight Arrow News – Medicare open enrollment begins with fewer plans (Oct 2026)
- CMS – 2027 Medicare Advantage and Part D Star Ratings fact sheet
- Military.com – Medicare late enrollment penalties
- Medicare.gov – Joining a health or drug plan
Insurance prices, discounts and rules change often and vary by state. Figures were checked in October 2026; confirm details with the insurer or your state insurance department.