Medicare Part D 2027: What a $2,400 Cap Means for Cancer Drugs

In 2027, people with Medicare drug coverage will pay no more than $2,400 out of pocket for covered Part D drugs, up from $2,100 in 2026. Part D is the Medicare drug coverage you get through a standalone drug plan or a Medicare Advantage plan that includes drug coverage. For people with cancer who take costly drugs by mouth, the cap is the clearest guide to next year's costs, and open enrollment, which runs through Dec. 7, is the time to plan around it.

How Medicare Part D Drug Costs Change in 2027

The Centers for Medicare & Medicaid Services (CMS) set the 2027 numbers in April 2026. The yearly out-of-pocket cap rises $300, from $2,100 to $2,400. The highest deductible any drug plan can charge rises from $615 to $700. A deductible is the amount you pay before your plan starts sharing the cost, and some plans have none.

Once your spending on covered Part D drugs reaches $2,400, Medicare says you move into "catastrophic coverage" and won't have to pay out of pocket for covered Part D drugs for the rest of the calendar year.

Who Benefits Most From the Out-of-Pocket Cap

The cap matters most for people taking oral cancer drugs, such as targeted therapies and oral chemotherapy, that can cost thousands of dollars a month. Many will reach $2,400 early in the year, sometimes with one fill, and then pay nothing more for covered Part D drugs until January 2028.

That is a big change from years past. Writing for CURE in January 2019, before the cap existed, Bill Wimbiscus, who has multiple myeloma and takes the oral drug Revlimid (lenalidomide), put it plainly: "Yet, having insurance is only half the battle." He added, "In my case, copays run about $10,000 per year." Read more in his story about living with oral chemotherapy.

Four cancer drugs will also have Medicare-negotiated prices starting Jan. 1, 2027: Xtandi (enzalutamide) for prostate cancer, Pomalyst (pomalidomide) for multiple myeloma and Kaposi sarcoma, Ibrance (palbociclib) for breast cancer and Calquence (acalabrutinib) for chronic lymphocytic leukemia and mantle cell lymphoma. The $2,400 cap is still the most anyone pays in a year for covered Part D drugs.

Spreading Cancer Drug Costs Over 12 Months

Reaching the cap in January still means a big bill at once. The Medicare Prescription Payment Plan lets you pay your Part D drug costs in monthly bills from your plan instead of all at the pharmacy counter. It does not lower your total; Medicare says you pay the same amount for the year either way.

Here is a simple example using the 2027 cap. Say your first fill in January brings you to $2,400. Without the payment plan, you pay that amount at the pharmacy that month. If you join the payment plan before that January fill, your plan bills you $200 a month for 12 months, which is $2,400 divided by 12. If instead you join in July with the same $2,400 due, the cost is spread over the six months left, or $400 a month. That is why Medicare says people with high drug costs early in the year benefit most.

For 2027, Medicare says your plan will automatically renew your participation each year unless you opt out or change plans. If you switch plans during open enrollment, you will need to sign up again with your new plan. People who get or qualify for Extra Help, a program that lowers drug costs for people with limited income, may not be good candidates for the payment plan, according to Medicare. Premiums are billed separately and are not part of it.

What the $2,400 Cap Does Not Cover

The cap applies only to covered Part D drugs. It does not include your monthly premium. It also does not include drugs covered by Part B, the part of Medicare that pays for treatment given by a health care provider, such as chemotherapy infusions in a doctor's office, clinic or hospital outpatient department. For those, Medicare says you generally pay 20% of the Medicare-approved amount after the Part B deductible.

Because the cap counts only covered drugs, a drug missing from your plan's formulary (its list of covered drugs) won't help you reach it.

Steps to Take Before Medicare Open Enrollment Ends Dec. 7

Use Medicare's online Plan Finder at Medicare.gov. Enter every drug and dose you take and compare 2027 plans on total yearly cost, not only the premium. CMS set the 2027 base beneficiary premium, a national figure used to calculate plan premiums, at $41.33 a month, but your premium depends on the plan you choose. CMS is also ending, after 2026, a temporary program that helped hold down premiums for standalone drug plans, so check your 2027 premium closely.

For each plan you consider, confirm that your cancer drugs are on the formulary, whether they need prior authorization (plan approval before the drug is covered) and which pharmacies are in network, including the specialty pharmacy that would fill your drug. If your oral drug will push you to the cap early, ask your plan about the payment plan for January. CURE's open enrollment checklist for people with cancer covers network and specialty pharmacy questions in more detail. Your cancer center's financial counselor or your State Health Insurance Assistance Program can also help, free of charge.

References

1. "Announcement of Calendar Year (CY) 2027 Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies." Centers for Medicare & Medicaid Services. April 6, 2026.
2. "Annual Release of Part D National Average Bid Amount and Other Part C & D Bid Information." Centers for Medicare & Medicaid Services. July 28, 2026.
3. "How much does Medicare drug coverage cost?" Medicare.gov. Accessed Nov. 9, 2026.
4. "What's the Medicare Prescription Payment Plan?" Medicare.gov (CMS Product No. 12211). September 2026.
5. "Examples of this payment option." Medicare.gov. Accessed Nov. 9, 2026.
6. "Your Medicare in 2027: What's New & Changing." Medicare.gov (CMS Product No. 12229). September 2026.
7. "Medicare Drug Price Negotiation Program: Negotiated Prices for Initial Price Applicability Year 2027." Centers for Medicare & Medicaid Services. November 2025.
8. "Chemotherapy." Medicare.gov. Accessed Nov. 9, 2026.
9. "Contract Year 2026 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program (CMS-4208-F) fact sheet." Centers for Medicare & Medicaid Services. April 2025.

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