If you take prescription drugs on Medicare, January 1, 2027 brings big changes: negotiated prices take effect on 15 more high-cost drugs — including Ozempic, Rybelsus, and Wegovy — and your yearly out-of-pocket limit moves to $2,400.
But open enrollment (October 15–December 7, 2026) is when these changes hit your wallet. Here’s what’s changing and what to do.
1. The out-of-pocket cap rises to $2,400
Since 2025, Part D has had a yearly ceiling on covered drug costs — new under the Inflation Reduction Act. The cap started at $2,000 in 2025, rose to $2,100 in 2026, and lands at $2,400 for 2027. Once your spending on covered drugs hits that amount, you pay $0 for covered drugs for the rest of the year.
Premiums don’t count toward it — only your deductible, copays, and coinsurance on covered formulary drugs do.
2. The maximum deductible climbs to $700
The maximum Part D deductible rises from $615 in 2026 to $700 in 2027. Not every plan uses the full amount, and Extra Help recipients pay little or nothing. Check your plan’s number — you pay it before cost-sharing kicks in.
3. Fifteen more drugs get negotiated prices
Starting January 1, 2027, negotiated prices take effect on 15 high-cost drugs, discounted roughly 38% to 85% off list prices. About 5.3 million beneficiaries use them; CMS expects roughly $685 million in out-of-pocket savings.
The full list: Ozempic, Rybelsus, and Wegovy (semaglutide), Trelegy Ellipta, Xtandi, Pomalyst, Ibrance, Ofev, Linzess, Calquence, Austedo and Austedo XR, Breo Ellipta, Tradjenta, Xifaxan, Vraylar, Janumet and Janumet XR, and Otezla — covering diabetes, several cancers, asthma and COPD, gut conditions, movement disorders, and psoriasis.
The standout: the semaglutide group was negotiated to about $274 for a 30-day supply, down from $959 — a 71% cut.
One caveat: the negotiated price is what Medicare and your plan pay — not automatically your copay. Check your plan’s tier placement.
4. The federal premium backstop goes away
Since 2025, a temporary federal program held stand-alone premiums down with extra subsidies. CMS is ending it after 2026, projecting the average stand-alone premium rises less than $1 (to about $36), with 88% of non-low-income beneficiaries able to access a basic plan at $10.30 a month or less.
Analysts are more cautious — estimates suggest nearly half of the roughly 25 million stand-alone enrollees could see $11–$20 monthly increases. The base beneficiary premium rises to $41.33 from $38.99. Either way, this is the year to compare plans instead of auto-renewing.
5. You can spread drug costs into monthly payments
The Medicare Prescription Payment Plan continues in 2027: an installment option, not a discount. Hit the full $2,400 cap in January and stay enrolled all year, and bills run about $200 a month.
Timing matters: join in July and only six months remain to spread the cost, pushing bills toward $400 — so enroll before the plan year begins if you expect big early-year drug costs.
6. Insulin and vaccines stay protected
The $35 monthly cap on covered insulin remains in place for 2027 — even during the deductible phase. Recommended adult vaccines stay free under Part D.
Your open-enrollment checklist (before Dec 7)
- Read your Annual Notice of Change. Plans must mail it by the end of September. Look for premium changes, drugs moved to higher tiers, and pharmacy network changes.
- Compare plans on medicare.gov using your actual prescriptions. Watch for prior authorization rules and mail-order requirements in the fine print.
- Check whether you may qualify for Extra Help or a Medicare Savings Program. These can erase premiums and slash drug copays — and Extra Help shields you from the premium shifts in change 4.
Need a hand? Our free Apply for Me program matches San Antonio seniors with programs they may qualify for — including Extra Help and Medicare Savings Programs. Free, unbiased counseling is also available from Texas SHIP counselors.
Frequently asked questions
Will Ozempic cost less on Medicare in 2027?
About $274 for a 30-day supply, down from a $959 list price — but your copay depends on your plan’s tier placement. Check your 2027 formulary.
What is the Part D out-of-pocket maximum for 2027?
$2,400 for covered Part D drugs — up from $2,000 in 2025 and $2,100 in 2026. It adjusts upward each year under the Inflation Reduction Act.
Do I need to switch plans for 2027?
Not necessarily — but compare. The premium stabilization program is ending, and formularies change every year. Use medicare.gov’s plan finder before December 7.
Does the $2,400 cap include my monthly premium?
No. Only spending on covered formulary drugs — deductible, copays, and coinsurance — counts toward the cap.
What is the Medicare Prescription Payment Plan?
An option to spread out-of-pocket drug costs into monthly bills instead of paying large amounts early in the year. It smooths timing, not your total. Enroll through your drug plan before the plan year starts.
I’m on a fixed income. What helps most?
Check whether you may qualify for Extra Help or a Medicare Savings Program — both can dramatically cut premiums and copays, and our free Apply for Me program can help.
Sources: CMS press release on 2027 Medicare Advantage and Part D stability; CMS 2027 Part D bid fact sheet; SeniorSimple’s Medicare Part D 2027 guide; SeniorSite’s Part D cap and payment plan guides; KFF and Avalere analyses; Becker’s Payer Issues. Figures verified across multiple sources as of October 2026. For general information only — not insurance or medical advice.
