If you have been seeing headlines about Medicare Part D changes coming in 2027, here is the most important point:
Medicare Part D prescription drug coverage is NOT ending.
What is ending is a temporary federal program that has helped stabilize premiums for many stand-alone Medicare Prescription Drug Plans due to market condition changes caused by the Inflation Reduction Act and other factors. This could affect what some beneficiaries pay for Part D covered medications in 2027, but it does not mean that everyone’s premium is going to increase.
What Is Changing?
In 2025, the Centers for Medicare & Medicaid Services (CMS) introduced the Part D Premium Stabilization Demonstration as Medicare implemented major prescription drug changes under the Inflation Reduction Act.
The program was designed to help reduce potential premium volatility in the stand-alone Prescription Drug Plan market during this transition.
- For 2025, participating plans received a $15 reduction in the base beneficiary premium calculation, and CMS limited year over year increases in a plan’s total Part D premium to $35.
- In 2026, that assistance was reduced. The premium reduction dropped to $10, while the allowable year over year premium increase grew to $50.
- CMS has now announced that the demonstration will end after December 31, 2026.
Does That Mean Your Premium Is Going Up?
Not necessarily. CMS has not said every Part D premium will increase. It has said that this temporary stabilization program is ending. Those are two very different things.
CMS has announced that the 2027 national average monthly bid amount is $296.05, compared with $239.27 for 2026. It also announced a 2027 base beneficiary premium of $41.33. Neither of these numbers is necessarily what you will pay. Individual plan premiums will vary.
We will know much more when the actual 2027 plan premiums, formularies, pharmacy networks, and benefits become available.
Don’t Look at Premium Alone
This is probably the most important advice we can offer:
Never choose a Medicare prescription drug plan based solely on its monthly premium.
When reviewing your 2027 coverage, we need to look at:
- Whether your medications are still covered
- What tiers your medications are on
- Your actual prescription costs
- Changes to deductibles
- Prior authorization or other requirements
- Whether your pharmacy remains preferred or in network
- Your estimated total annual cost
A plan with a lower monthly premium can sometimes cost you more over the course of the year.
What About Medicare Advantage?
The Premium Stabilization Demonstration specifically applies to stand alone Prescription Drug Plans, or PDPs.
Millions of beneficiaries receive their Part D coverage through a Medicare Advantage plan. Those plans operate differently.
That does not mean Medicare Advantage plans cannot experience prescription drug changes in 2027. It simply means we should not assume the end of this program will affect every Medicare beneficiary or every plan the same way.
What Should You Do Now?
For most people, the answer is simple: Nothing yet.
Don’t panic. Don’t cancel your coverage. And don’t change plans because of a headline.
Watch for your Annual Notice of Change, and once the 2027 plan information becomes available, we can compare your coverage based on your medications, pharmacy, doctors, health needs, and budget.
The Medicare Annual Enrollment Period runs from October 15 through December 7.
The Bottom Line
- Medicare Part D is not ending.
- A temporary program that helped stabilize premiums for participating stand-alone drug plans is ending after 2026.
- Could some premiums increase? Yes.
- Should you panic or change plans today? No.
When the final 2027 information becomes available, we will help you review the actual numbers and determine what makes the most sense for you.
Questions about your Medicare Insurance Plans and coverage?
Contact us at 330.892.0384.
Yost Insurance Agency is not connected with or endorsed by the U.S. government or the federal Medicare program. This information is provided for educational purposes and is not plan specific.
