The answer
What is the Medicare donut hole?
The donut hole was a coverage gap in Medicare Part D where you paid a larger share of drug costs after reaching a spending threshold.
For 2026, that old gap structure no longer works the same way, because Part D now has a yearly out-of-pocket cap of $2,100. An out-of-pocket cap is the most you pay yourself for covered drugs in a year. Once your covered drug spending reaches that $2,100 limit in 2026, you pay nothing more for covered prescriptions for the rest of the year. The phrase donut hole describes the older phase where costs jumped in the middle of the year, but the 2026 cap replaces that worry with a clear ceiling on what you spend.