Is there still a Medicare Part D donut hole?

There is no Medicare Part D donut hole in 2026. The coverage gap, which people often called the donut hole, was eliminated on January 1, 2025 by the Inflation Reduction Act. If you are shopping for a 2026 or 2027 Part D plan, that phase no longer applies to you.

How Part D costs work now

The benefit has three stages instead of four:

1. Deductible stage. You pay the full negotiated price until you meet your plan’s deductible. No plan may charge more than $615 in 2026 or $700 in 2027, and many charge less or nothing.
2. Initial coverage stage. You pay a copay or coinsurance on each prescription and your plan pays the rest.
3. Catastrophic stage. Once what you have paid out of pocket for covered drugs reaches the annual cap, you pay $0 for covered Part D drugs for the rest of the year. The cap is $2,100 in 2026 and $2,400 in 2027.

What changed, and why it matters

• Under the old rules there was a middle stage where your share of the cost jumped, and there was no limit on what you could spend in a year.
• Now your out-of-pocket drug spending is capped, which matters most if you take a high-cost specialty or brand-name medication.
• Only what you or someone on your behalf pays for covered drugs counts toward the cap. Premiums do not count.
• The Medicare Prescription Payment Plan lets you spread your out-of-pocket costs into monthly installments rather than paying a large amount at the pharmacy counter.
• People who qualify for Extra Help pay far less than these limits, and pay $0 for premiums and deductibles in many cases.

If you still see the term in plan documents

Check the plan year on the document. Materials for 2024 and earlier still describe a coverage gap because it existed then. Anything for 2026 or 2027 should not.

Talk to a licensed iHealthAgents advisor

We can compare every Part D plan available where you live and show you what your own prescriptions would cost under each one.

Book a time with a licensed advisor, or call Illinois 312-726-6565 or Texas 972-666-0578.

This article is for educational purposes only. Figures shown are the 2026 and 2027 Medicare Part D amounts published by CMS: a maximum deductible of $615 in 2026 and $700 in 2027, and an annual out-of-pocket cap of $2,100 in 2026 and $2,400 in 2027.