Black patients with diabetes are at greater risk of underuse of antidepressants even when they have equal access to health insurance. This study aimed to evaluate the impact of removing a significant financial barrier to prescription medications (drug caps) on existing black-white disparities in antidepressant treatment rates among patients with diabetes and comorbid depression. We used an interrupted time series with comparison series design and a 5% representative sample of all fee-for-service Medicare and Medicaid dual enrollees to evaluate the removal of drug caps on monthly antidepressant treatment rates. We evaluated the impact of drug cap removal on racial gaps in treatment by modeling the month-to-month white-black difference in use within age strata (younger than 65 years of age or 65 years of age or older). We compared adult dual enrollees with diabetes and comorbid depression living in states with strict drug caps (n = 221) and those without drug caps (n = 1133) before the policy change. Our primary outcome measures were the proportion of patients with any antidepressant use per month and the mean standardized monthly doses (SMDs) of antidepressants per month. The removal of drug caps in strict drug cap states was associated with a sudden increase in the proportion of patients treated for depression (4 percentage points; 95% CI, 0.03-0.05, P < 0.0001) and in the intensity of antidepressant use (SMD: 0.05; 95% CI, 0.03-0.07, P < 0.001). Although antidepressant treatment rates increased for both white and black patients, the white-black treatment gap increased immediately after Part D (0.04 percentage points; 95% CI, 0.01-0.08) and grew over time (0.04 percentage points per month; 95% CI, 0.002-0.01; P < 0.001). Policies that remove financial barriers to medications may increase depression treatment rates among patients with diabetes overall while exacerbating treatment disparities. Tailored outreach may be needed to address nonfinancial barriers to mental health services use among black patients with diabetes.