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Medicare Part D Plans: What’s Changing in 2027?

Medicare Part D plans change every year, so you should review your drug plan annually regardless of which plan you have. A drug can move from Tier 2 to Tier 3 and suddenly you face a deductible or a higher copay. The plan name can stay the same while the formulary does not. Make sure to Schedule Your Annual Review today!

2027 Medicare Part D Changes at a Glance

The Medicare Part D Threshold Increases to $2,400

One of the biggest Medicare Part D changes for 2027 is the increase in the annual out-of-pocket threshold.

The out-of-pocket threshold limit increases from: $2,100 in 2026 to $2,400 in 2027.

Once qualifying out-of-pocket spending on covered Part D drugs reaches $2,400, the beneficiary enters catastrophic coverage and pays $0 for covered Part D drugs for the remainder of the calendar year.

Remember, if a drug is not on your plan’s formulary and you do not receive an approved coverage exception, you are responsible for 100% of the cost, and that amount does not count toward your $2,400 Part D out-of-pocket threshold.

Is $2,400 a Medicare Part D spending cap?

For most consumers, calling it the 2027 Part D out-of-pocket cap is understandable.

Technically, CMS calls it the annual out-of-pocket threshold.

It does not mean every health care or prescription-related expense is capped at $2,400.

The $2,400 threshold does not include:

• Monthly Part D premiums

• Part D IRMAA

• Drugs that aren’t covered by the Part D plan

• Most over-the-counter medications

• Drugs covered under Medicare Part B

• Costs that do not qualify toward Part D true out-of-pocket spending

The threshold also resets on January 1 each year.

The Medicare Part D Deductible Increases to $700

The maximum Medicare Part D deductible increases substantially in 2027.

It goes from: $615 in 2026 to $700 in 2027.

$700 is the maximum permitted deductible.

A Part D plan may have:

• A $700 deductible

• A deductible below $700

• No deductible

• A deductible that applies to certain drug tiers but not others

This is why comparing Part D plans solely on the deductible can be misleading.

A plan with a $0 deductible could still cost more over the entire year than a plan with a $700 deductible if its monthly premium or prescription copayments are higher.

What really matters?

When comparing Part D plans, look at the combination of: Premium + deductible + medication costs

The lowest premium or lowest deductible does not automatically mean the lowest overall annual cost.

What you pay before you reach $2,400

Before you reach the $2,400 out-of-pocket limit threshold, you may pay a deductible, copay, or coinsurance for covered Part D drugs. In 2027, the deductible can be as high as $700, although some plans charge less or no deductible. Once you reach $2,400 in qualifying out-of-pocket costs, you pay $0 for covered Part D drugs for the rest of the year.

Medicare Negotiated Prices Take Effect for 15 Additional Drugs

Starting January 1, 2027, Medicare will add negotiated prices for 15 new drug groups. At the same time, four of the original 10 drug groups will leave the program. That leaves 21 selected drug groups with negotiated prices in effect for 2027.

Added for 2027

The 15 newly negotiated drug groups are:

• Ozempic, Rybelsus and Wegovy

• Trelegy Ellipta

• Xtandi

• Pomalyst

• Ofev

• Ibrance

• Linzess

• Calquence

• Austedo and Austedo XR

• Breo Ellipta

• Xifaxan

• Vraylar

• Tradjenta

• Janumet and Janumet XR

• Otezla and Otezla XR

Leaving the Program in 2027

Four drugs from the original negotiated drug group are scheduled to leave the program in 2027 because generic or biosimilar competition became available:

• Entresto

• Xarelto

• Stelara

• NovoLog and Fiasp

The negotiated price is the price Medicare negotiated with the manufacturer.

It is not automatically what you pay at the pharmacy. You may pay that amount during the deductible, a copay or coinsurance after that, or $0 once you reach the threshold.

What you pay depends on factors including:

• Your Part D plan

• The drug’s formulary tier

• Copayment or coinsurance

• Deductible status

• Pharmacy

• Whether the medication is being covered under regular Part D

• Whether another Medicare program applies

The Medicare GLP-1 Bridge Program Continues Through 2027

Medicare launched the Medicare GLP-1 Bridge Program on July 1, 2026.

CMS has now extended the program through December 31, 2027.

Eligible Medicare Part D beneficiaries can obtain certain qualifying GLP-1 medications for weight management for a $50 monthly copayment.

CMS currently lists all formulations of Foundayo, all formulations of Wegovy, and only the KwikPen formulation of Zepbound for the Bridge. The Zepbound single-dose vial and single-dose pen are not included.

Part D distinction vs Medicare GLP-1 Bridge Program

The Medicare GLP-1 Bridge operates outside the normal Part D benefit.

That means: The $50 GLP-1 Bridge copay does not count toward the $2,400 Part D out-of-pocket threshold.

CMS also says:

• The Part D deductible does not apply

• The $50 copay does not count toward TrOOP

• Part D Extra Help does not reduce the Bridge copay

That is an important distinction for someone calculating how quickly they may reach the $2,400 Part D threshold.

CMS limits the Bridge to weight-management use, and only for specified products and formulations. If the drug is prescribed for a medical condition already covered under Part D, such as type 2 diabetes, certain cardiovascular-risk reduction uses, moderate-to-severe obstructive sleep apnea, or qualifying MASH, coverage runs through the Part D plan rather than the Bridge Program.

Eligibility rules apply. Please speak with your doctor to determine whether one of these medications may be appropriate for you.

The Medicare Prescription Payment Plan Continues

The Medicare Prescription Payment Plan also continues in 2027.

Every Medicare Part D plan must offer it.

It allows beneficiaries to spread qualifying prescription drug out-of-pocket costs across monthly payments instead of paying the entire amount at the pharmacy.

For example, someone who fills a very expensive prescription early in January may be able to spread the amount they owe across subsequent months.

The Medicare Prescription Payment Plan changes when you pay, not how much you owe.

It’s not an additional prescription drug discount.

What Should You Review for Your 2027 Medicare Part D Plan?

Before selecting or renewing Part D coverage, have an updated list of:

• Prescription name

• Dosage

• Quantity

• How frequently you refill it

• Preferred pharmacy

Then compare those exact prescriptions against the 2027 plan.

You should look at the projected total annual cost, not simply the monthly premium.

For example:

• Plan A costs $5 per month but makes one of your prescriptions expensive.

• Plan B costs $25 per month but provides substantially better pricing on that prescription.

• Plan B could easily be the less expensive plan over the entire year.

2027 Medicare Part D Open Enrollment

Medicare Open Enrollment for 2027 coverage runs:
October 15, 2026 through December 7, 2026.

Changes made during this period take effect January 1, 2027.

CMS recommends that beneficiaries review their coverage because plan premiums, costs, formularies and other benefits can change from year to year.

Key Takeaways

• The maximum deductible increases from $615 to $700.

• The annual Part D out-of-pocket threshold increases from $2,100 to $2,400.

• Beneficiaries continue paying $0 for covered Part D drugs after reaching the catastrophic threshold.

• Negotiated Medicare prices take effect for 15 additional high-cost drug groups

THIS WEEK’S ACTION STEP

Schedule an Annual Review to review your Drug Plan:

But the biggest question for an individual beneficiary is still much more personal:

Are your prescriptions covered by your plan in 2027, what will you actually pay for them, and is there another Part D plan that covers those same drugs for less?

Fun Fact

Viagra wasn’t originally developed for erectile dysfunction. Sildenafil was first studied as a treatment for angina and high blood pressure, but researchers noticed an unexpected side effect during clinical trials. That side effect ultimately became the drug’s primary use.

Have a blessed week!
Matt

Founder, Senior Healthcare Planning
Founder, Ashbury Boutique Wealth Management

Sources

• CMS 2027 Medicare Advantage and Part D Rate Announcement

• CMS 2027 Medicare Drug Price Negotiation Program Fact Sheet

• CMS Selected Drugs and Negotiated Prices

• CMS 2027 Selected Drug List Fact Sheet

• CMS Medicare Prescription Payment Plan

• Medicare.gov Part D Coverage Information