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Table V-6. Part D Benefit Parameters for Defined Standard Benefit for CY 2025 and CY 2026 for Non-LIS Beneficiaries22
2025 2026 Deductible Phase Cost sharing: 100% Cost sharing: 100%
Deductible: $590 Deductible: $615 Initial Coverage Phase Applicable Drugs Cost sharing: 25% Non-applicable Drugs Cost sharing: 25% Applicable Drugs Cost sharing: 25% Non-applicable Drugs and Selected Drugs Cost sharing: 25%
Out-of-Pocket Threshold: $2,000 Out-of-Pocket Threshold: $2,100 Section D. Retiree Drug Subsidy Amounts While the IRA significantly redesigned the Part D benefit for 2025, the IRA did not change the statutory requirements for retiree drug subsidy plans (as defined in section 1860D-22 of the Act). Specifically, the IRA did not change the requirements related to the methodology for calculating the cost limit and threshold for the CY 2026 retiree drug subsidy amounts for retiree drug subsidy plans.23 Per section 1860D-22(a)(3)(B) of the Act and § 423.886(b)(3), the cost threshold and cost limit for qualified retiree prescription drug plans are updated using the API, as defined previously in this document.24 The updated cost threshold is rounded to the nearest multiple of $5 and the updated cost limit is rounded to the nearest multiple of $50. The cost threshold and cost limit are defined as $590 and $12,150, respectively, for plans that end in CY 2025, and as $615 and $12,650 for plans that end in CY 2026, as noted in Table V-7. Table V-7. Updated Retiree Drug Subsidy Amounts in CY 2026
2025 2026 Retiree Drug Subsidy Amounts
Cost Threshold $590 $615 Cost Limit $12,150 $12,650
22 These parameters reflect additional plan coverage required for covered insulin products under section 1860D-2(b)(9) of the Act, as added by section 11406 of the IRA, and ACIP-recommended adult vaccines under section 1860D-2(b)(8) of the Act, as added by section 11401 of the IRA. 23 Please see the Final CY 2025 Part D Redesign Program Instructions: https://www.cms.gov/files/document/final-cy-2025-part- d-redesign-program-instructions.pdf. 24 The cost threshold is the amount of gross retiree costs that a retiree must incur before the retiree drug subsidy applies. The cost limit is the maximum amount of gross retiree costs that the retiree drug subsidy will cover after a retiree hits the cost threshold.