Medicare Part D has two coverage stages in 2026: Initial Coverage and Catastrophic Coverage. Initial Coverage: you pay your plan's cost-sharing (copays/coinsurance) until you reach $2,000 in out-of-pocket drug costs. Catastrophic Coverage: after $2,000 OOP, you pay $0 for covered drugs for the rest of the year.
Key Points
- Initial Coverage: pay plan cost-sharing until $2,000 OOP
- Catastrophic Coverage: after $2,000 OOP, pay $0 for covered drugs
- The donut hole (coverage gap) was eliminated in 2024
- $2,000 OOP cap is a major improvement for high drug cost patients
- Extra Help may reduce costs further