The 2026 Cap Update & Why It’s $100 Higher | Simplefill

In 2026, a number of changes are coming to Medicare. The goal behind these changes is to offer lower medication costs overall, but that is not necessarily what’s going to occur for everyone. 

One of the changes you can expect this year is a medication cap that is $100 higher. Why is this change being made, and what other changes can you expect?

How Has the Cap Changed?

The previous out-of-pocket cap for prescription drugs in Medicare Part D was $2,000. Once you reached that amount, you wouldn’t have to pay another dollar for covered medications for the rest of the year. 

As of 2026, however, that cap is rising by $100. It applies to Medicare-covered prescriptions, some vaccines, and medical devices. 

Why is the Cap Changing?

This increase is the result of inflation. The cap was never meant to be a fixed rate but, instead, should fluctuate to address inflation and rising medication costs. 

Despite the cap being a bit higher, recipients of Medicare Part D no longer have to worry about the “donut hole” problem. Until the passing of the Inflation Reduction Act (IRA) under the Biden administration,  there was a very high threshold you had to meet, followed by a gap in which you had to pay around 25% for drugs. 

In 2024, there was also catastrophic coverage. Once you reached a certain threshold ($8,000 in 2024), you would pay very little for the rest of the year. 

The IRA eliminated the donut hole and instead placed the $2,000 cap for 2025. As of 2026, the cap is now $2,100. 

Were Other Changes Made to Medicare?

A few other changes are coming to Medicare this year. For one, you can expect premiums to increase for Medicare Part B recipients. These are not necessarily going to be guided by the rate of inflation, however. The spike in prices is the result of an increase in the cost of care as well as a surge in the use of medical services. 

Part B monthly premiums, which were $185 a month in 2025, will now be $202.90 a month. It’s the third year in a row that premiums have increased beyond the rate of Social Security’s cost-of-living adjustment. 

Additionally, for some people who have Part A, there will be an increase in premiums, adding up to $565 a month. For those who have 30 to 39 quarters accumulated, monthly premiums will be $311.

This is also the first year in which Medicare-negotiated prices for certain drugs will come into effect. This is meant to lower out-of-pocket costs for beneficiaries and Medicare itself. A few different drugs will be impacted by these changes, with discounts ranging from 38% to 79% off the 2023 price lists. 

For those who take medications for diabetes, the cap will remain at $35 for a month’s supply. That will be the case whether you’ve met your deductible or not. 

Get Affordable Access to Prescription Medications

Simplefill is a full-service prescription assistance company that researches, qualifies, and maintains patients’ enrollment in all sources of assistance available to them.

Apply today by calling 877-386-0206. A caring Simplefill representative will contact you within 24 hours to discuss your application and, if qualified, enroll you in the program.

Frequently Asked Questions

The answers to these frequently asked questions may offer further guidance on Medicare changes coming in 2026. 

How Many Drugs Has Medicare Negotiated Prices For?

The first 10 drugs that Medicare has negotiated prices for will be available at those lower rates in 2026. Each year, Medicare strives to negotiate further. The second round of negotiations is occurring. The program chooses the most appropriate medications depending on the number of people who rely on them and how expensive they are. 

What Is the Inflation Reduction Act?

The Inflation Reduction Act is legislation passed by the Biden administration. It targeted a number of issues, including climate change and energy production, by proposing innovative solutions. The act strives to lower medication prices for Medicare recipients, while also investing in public health initiatives. 

Why Are Medication Costs So High?

Numerous factors influence the cost of medications in the country. The United States doesn’t have central price negotiation processes. There are also Pharmacy Benefit Managers, who act as middlemen in the process of negotiating with manufacturers. Their involvement can add to the costs. 

There is also the issue of patents, with many manufacturers engaging in aggressive litigation strategies that make it impossible for smaller manufacturers to create generic drugs.