07-08-2025
Looking Ahead: The Medicare Prescription Payment Plan In 2026
2025 has been a busy year as some of the Inflation Reduction Act initiatives have taken effect. The biggest one is probably the cap on Part D out-of-pocket costs. This year, the most a drug plan enrollee will pay for covered drugs from an in-network pharmacy is $2,000.
The other big change, the Medicare Prescription Payment Plan (MPPP) is connected to this cap. Those who reach the threshold can face a big bill at the pharmacy. For instance, one specialty drug could in the first month of the year hit the limit. The MPPP allows an enrollee to spread the payments out over the course of the calendar year, instead of all at Basics
For those who are new to this, here's a quick review of 10 important Coming
After the inaugural year of the MPPP, it's time to look at what is scheduled to happen next threshold will increase from $2,000 to $2,100.A participant in the MPPP this year will be reenrolled automatically for 2026. The drug plan must send the renewal notice after the end of the annual coordinated election period (Open Enrollment) but prior to the beginning of the plan year (January 1).
Two points about automatic renewal:
I could not find any mention about how automatic renewal will handle those who have had a change in their medications and no longer would reach the $2,100 cap. The monthly billing in those situations often starts out low but then increases significantly heading toward the end of the an enrollee gets a new medication that hits the point-of-sale notification threshold, the pharmacy must issue the Medicare Prescription Payment Plan Likely to Benefit Notice. (In 2025, the trigger is $600.) CMS had considered requiring the Part D plan sponsors to ensure that pharmacies were prepared to inform the enrollee about the actual out-of-pocket cost of the drug; however, that was not finalized. Instead, CMS 'continues to encourage pharmacies to leverage standard industry transaction set data to provide OOP costs to participants verbally upon request.' Because education about the MPPP is the plan's responsibility, customers may leave the pharmacy without the prescription until they figure out the impact on their monthly a Part D plan bills an MPPP enrollee over the maximum monthly cap (determined by a formula), it should work with the individual to decide whether to refund the difference or apply the overpayment to the remaining out-of-pocket is difficult to find current MPPP enrollment numbers. Avalere Health reported that, of the 1.2 million beneficiaries who met the threshold, only 190,000 (16%) who picked up a medication in February 2025 were enrolled. There are probably several reasons why so many did not sign up for the MPPP together with the $2100 cap can help drug plan enrollees manage the cost of their medications. But at the same time, those who choose to ignore this new Medicare program won't be financially punished. The prescription drug coverage will still be there.
