What the Part D “Coverage Gap” Used to Mean
For years, Medicare Part D had a much-discussed “coverage gap” — often called the donut hole — where beneficiaries who spent enough on prescriptions in a year would suddenly face much higher costs before catastrophic coverage kicked back in. The Inflation Reduction Act restructured Part D’s cost-sharing phases, and for 2026 the practical effect is a hard annual out-of-pocket cap.
The 2026 Part D Structure
In 2026, the standard Part D deductible is $615. After you meet the deductible, you move into the initial coverage phase, sharing costs with your plan according to its formulary tiers. Once your total out-of-pocket drug spending for the year reaches $2,100, you move into the catastrophic coverage phase — and from that point forward, you pay $0 for covered Part D drugs for the rest of the calendar year. That $2,100 cap is the single most important Part D number to know for 2026, because it means your maximum drug spending for the year is capped regardless of how many prescriptions you fill.
Why This Still Catches People Off Guard
Even with the cap in place, a few things trip people up:
- Formulary tiers matter. Two plans can have very different costs for the exact same drug depending on which tier it sits on. A plan that looks cheap on premium alone can be expensive if your specific medications are on a high tier.
- Not all pharmacies are equal. Preferred pharmacy networks can mean a meaningfully lower copay than an out-of-network pharmacy for the same drug, same plan.
- Mid-year plan changes to formularies are rare but possible. Reviewing your plan each year during AEP — rather than assuming this year’s plan is still the cheapest option for your specific drug list — is the best way to avoid surprises.
How to Check Where You Stand
Your Part D plan sends an Explanation of Benefits (EOB) after each fill showing your running total toward the deductible and the $2,100 cap. If you’re not sure where you stand for the year, your plan’s member portal or customer service line can tell you exactly how much you’ve spent so far.
Have questions? Schedule a free review with Kayla Price, a licensed insurance agent at Price Services Group. Call 866-648-1578 or visit priceservicesgroup.com/schedule.
Price Services Group, LLC is not affiliated with or endorsed by the U.S. government or the federal Medicare program. NPN: 18530055 | Agency NPN: 20387435