In 2026, there is no distinct "donut hole" phase in Medicare Part D, according to CMS. The old coverage-gap structure was replaced by the Inflation Reduction Act's three-phase design: a deductible phase (up to $615), an initial coverage phase, and a catastrophic phase in which your parent pays $0 after out-of-pocket spending reaches the $2,100 annual cap. The term "donut hole" describes a gap that the current design no longer contains.
Using benefits
Medicare Part D Coverage Gap in 2026: Does the "Donut Hole" Still Exist? (2026)
By Chuck Brodsky, Co-Founder, MediNav — Updated July 2026 — 6 min read
Quick answer
Caregivers who managed a parent's drugs a few years ago remember the donut hole as the stretch where costs suddenly jumped mid-year. If you are looking for it in 2026, you will not find it — the phase it referred to no longer operates as a separate step, and understanding why prevents needless worry about a mid-year cost spike.
What the donut hole used to be
For years, Part D had a coverage gap: after a parent and their plan had spent a set amount, coverage dropped and the beneficiary paid a much larger share until they reached catastrophic coverage. That gap was the "donut hole." It was closed gradually over more than a decade, and the Inflation Reduction Act then replaced the entire structure with a simpler design.
The 2026 design has three phases, not four
In 2026, Part D moves through three phases. In the deductible phase, your parent pays the full negotiated price until the plan deductible — up to $615 — is met. In the initial coverage phase, your parent pays coinsurance or copays. In the catastrophic phase, reached once out-of-pocket spending hits the $2,100 annual cap, your parent pays $0 for covered Part D drugs for the rest of the year. There is no separate gap phase between initial and catastrophic coverage.
Why people still hear the term
The phrase persists in older articles, plan materials, and casual conversation, so caregivers reasonably expect a donut hole to appear. It does not. If a source describes an active coverage gap for 2026, it is out of date. What replaced it is the hard $2,100 out-of-pocket cap, which is more protective than the old design because it puts a firm ceiling on covered-drug spending.
What this means for planning a parent's year
The practical effect is predictability. Under the old donut hole, families braced for a mid-year cost jump that was hard to forecast. In 2026, your parent moves from the deductible, through coinsurance, to $0 once they reach the $2,100 cap — no sudden gap. For a parent on expensive drugs, the main planning task is managing the timing of that spending, not surviving a coverage gap.
For related reading, see the Part D $2,100 out-of-pocket cap and what it covers.
When to call MediNav
- Free: Ask a specific question — ask how your parent’s Part D coverage works in 2026 without the old donut hole.
- Free: Run the coverage check — in about two minutes, see what a parent is likely eligible for with 2026 figures for your state.
- Paid ($9–$19/mo): MediNav Watch and Watch+ re-check the figures as they change each year and remind you before deadlines, so nothing lapses unnoticed.
Related guides
- The Part D $2,100 Out-of-Pocket Cap — the hard ceiling that replaced the gap
- What Is Extra Help? — the drug subsidy worth about $5,700 a year
- How to Lower Medicare Costs — government programs that cut drug costs
- The Medicare Savings Programs — premium and cost-sharing help
Frequently asked questions
What if an article says my parent will hit the donut hole in 2026?
That information is out of date. In 2026, Part D has three phases — deductible, initial coverage, and catastrophic — with no separate coverage gap. Once out-of-pocket spending reaches the $2,100 cap, your parent pays $0 for covered drugs. Rely on current CMS materials.
How is the new design better than the old donut hole?
It is more predictable and more protective. Instead of a mid-year stretch of higher costs, your parent's covered-drug out-of-pocket spending is capped at $2,100 for the year. After that, they pay nothing more for covered Part D drugs until the next year begins.
Does my parent still have a deductible in 2026?
Possibly. Many plans charge a deductible of up to $615 in 2026, paid at the full negotiated price before the initial coverage phase begins. Some plans set a lower deductible or none at all. Check the specific plan's deductible when comparing options.
When does my parent reach the catastrophic phase?
When their out-of-pocket spending on covered Part D drugs reaches the $2,100 annual cap. At that point they pay $0 for covered drugs for the rest of the year. How quickly they get there depends on how expensive their medications are and when they fill them.
Did the Inflation Reduction Act eliminate the coverage gap?
The coverage-gap structure was replaced by the Inflation Reduction Act's three-phase design. Rather than framing it as a single event, the accurate description is that the old gap no longer operates as a separate phase; a deductible, initial coverage, and a capped catastrophic phase took its place.
Does the $2,100 cap reset each year?
Yes. The out-of-pocket cap applies per calendar year. A parent who reaches it in one year starts over in January, moving through the deductible and initial coverage phases again before returning to the catastrophic phase.
Sources: CMS Final CY2026 Part D Redesign Program Instructions, Medicare.gov — Costs for Medicare drug coverage. Last verified July 2026.