The 2027 numbers
Official These are Medicare's final numbers for 2027, from the CMS 2027 Rate Announcement (April 6, 2026). Checked .
| Standard benefit | 2026 | 2027 |
|---|---|---|
| Most a plan's deductible can be | $615 | $700 |
| Your share after the deductible | 25% | 25% |
| Yearly out-of-pocket cap | $2,100 | $2,400 |
| After the cap | $0 | $0 |
Both 2027 numbers grew by the same 13.65% yearly increase: $615 × 1.1365, rounded to the nearest $5, is $700; $2,100 × 1.1365, rounded to the nearest $50, is $2,400. Medicare's 2027 base premium is $41.33 a month (2026: $38.99), but real plan premiums vary a lot and seldom match it, so the calculator asks for yours. Premiums never count toward the cap.
The calculator goes month by month, January to December. In each month it handles your drugs in the order you listed them. For each fill it works out what you pay: first any deductible left, then your share (25%, or your plan's copay or coinsurance), until the cap is reached. A 90-day fill counts in the month you fill it.
What counts toward the cap
Since 2025, for each fill Medicare counts the greater of what you would owe under the standard benefit or what you owe under your plan's own design (CMS TrOOP memo, corrected Dec 20, 2024). So in a plan with low copays, the count toward $2,400 can grow faster than your own payments. Your payments stop when the count reaches the cap.
Example: a $600 brand drug with a $47 copay and a $0 deductible. You pay $47 a month ($564 for the year), but Medicare counts $2,325 toward your cap. The calculator shows this as “What counts toward your cap.”
If you choose “I know what I pay at the pharmacy,” we can only count what you pay. If your plan has extra coverage, you may reach the cap sooner; your plan's Explanation of Benefits shows the exact count.
Insulin and vaccines
- Each covered insulin costs no more than the lesser of $35 for a one-month supply or 25% of its price ($105 for a 90-day fill). The deductible never applies. What you pay counts toward the cap and toward the $700 deductible.
- Recommended adult vaccines cost $0 with no deductible, so leave them out.
The payment plan formula
The Medicare Prescription Payment Plan sets a most-you-can-be-billed amount (a “cap”) for each month. It uses the $2,400 yearly cap even if your plan's is lower, and bills only what you would have paid at the pharmacy. No fees, no interest.
- First month (the month you join): ($2,400 − what already counted toward your cap this year) ÷ months left in the year, including this one. Your bill is that amount or what you owe that month, whichever is less. Join for January and the first cap is $2,400 ÷ 12 = $200.
- Later months: (what you still owe from earlier months + this month's new costs) ÷ months left in the year. Your bill is that amount. December bills whatever is left.
That's why bills usually rise through the year: unpaid costs roll forward into fewer remaining months.
Checked against Medicare's own example
Medicare.gov example 3 (2026, $2,100 cap): you pay $4 most months, $617 in April and $124 in July and October, and you join the payment plan in April. Our formula reproduces every bill Medicare.gov prints:
| Month | At the pharmacy | Payment plan bill |
|---|---|---|
| January | $4.00 | paid at pharmacy |
| February | $4.00 | paid at pharmacy |
| March | $4.00 | paid at pharmacy |
| April | $617.00 | $232.00 |
| May | $4.00 | $48.63 |
| June | $4.00 | $49.20 |
| July | $124.00 | $69.86 |
| August | $4.00 | $70.66 |
| September | $4.00 | $71.66 |
| October | $124.00 | $113.00 |
| November | $4.00 | $115.00 |
| December | $4.00 | $118.99 |
The calculator also reproduces all three worked examples in CMS's payment plan guidance and both examples in the CMS TrOOP memo, to the cent. You can see these on Medicare.gov's payment plan page (opens in a new tab).
Rounding and limits
Each month's cap is rounded to the cent, with half a cent rounded up. CMS's own example ($181.455 becomes $181.46) and Medicare.gov's ($132.045 becomes $132.05) only work with this rule.
A few cents can differ from rounded examples
We follow the formula in CMS guidance. Medicare.gov example 2 prints December as $241.53, but its column then adds up to $959.94 instead of the stated $960; the formula gives $241.59. Medicare.gov example 1 shows “$190.38*” for every month from May to December as an approximation; recalculating month by month gives $190.38 or $190.37, adding up to exactly $2,100.
What we assume (and say so):
- Your share of each fill is rounded to the cent, half up. Plans and pharmacies may round a cent differently.
- Drugs are handled in the order you list them. Near the deductible or the cap this can move a few dollars between drugs; the year's total usually doesn't change.
- If a fill crosses the end of the deductible and your plan charges a copay, we count the rest of the deductible plus the full copay (as in CMS's TrOOP example). Your plan may split it differently.
- The 2026 comparison uses the same prices, the 2026 rules and your plan deductible (at most $615).
Not included: Extra Help, the income-related extra amount (IRMAA), late penalties, drugs your plan doesn't cover, Part B drugs given in a clinic, coupons and pharmacy discounts. Not medical or insurance advice. Back to the calculator.