Medicare Part D Premiums Are Set to Shift in 2027: What Retirees May Pay

Millions of seniors enrolled in Medicare Part D should prepare for changes in premium costs in 2027.

The Centers for Medicare & Medicaid Services (CMS) has forecast new prices for prescription drug coverage beginning Jan. 1.

Here’s a look at how premiums may change and a few simple ways retirees can keep more money in their pockets while shopping for coverage during Medicare’s annual open enrollment period.

How Medicare Part D premiums could change in 2027

CMS projects that the average total monthly premium for standalone Part D plans will edge up next year, rising from $35.06 a month in 2026 to $36 in 2027.

That increase amounts to less than $12 for the year, which may be a welcome bit of relief for seniors facing higher prices for essentials such as gas and groceries.

Even better, Part D premiums inside Medicare Advantage plans are expected to drop sharply by 38%, falling from $11.32 a month in 2026 to $7 in 2027.

Why Part D premiums are staying fairly stable

The expectation that next year’s premiums will remain under control is both encouraging and somewhat unexpected. A federal subsidy program that had helped lower Part D premium costs ended in August, prompting concerns that premiums could rise significantly.

Still, CMS projections suggest those worries may not materialize for at least some beneficiaries. In a recent statement, the agency said Part D costs are “returning to normal market conditions.”

CMS Administrator Dr. Mehmet Oz also said that lower “handouts” to large health insurers are helping keep premiums down.

Ways to reduce Medicare Part D costs in 2027

Most Medicare beneficiaries are likely to see only a modest increase in Part D costs next year, and some may pay less than they do now.

That said, the average does not reflect every individual’s bill. Some enrollees will pay more than the typical amount.

Premiums vary by plan and location, and income also affects what you pay in Medicare premiums next year. One of the most effective ways to control costs is to compare plans carefully during Medicare’s annual open enrollment period.

With that in mind, here are several things to review when comparing prescription drug coverage options during open enrollment, which runs from Oct. 15 through Dec. 7.

Monthly premium

Your monthly premium is the one Part D expense you cannot avoid, even if you do not use any prescription drugs during 2027. Private insurers offer Part D plans, and each sets its own premium.

For that reason, it makes sense to compare plans closely and choose one with a premium you can afford.

Deductible

A deductible is the amount you must pay before your insurance coverage begins.

Medicare drug plans cannot have an annual deductible above $700 in 2027. Some plans have lower deductibles, while others have none at all.

That is another reason shopping around can pay off.

Out-of-pocket cap

There is a yearly limit on what you pay out of pocket for prescription drug coverage. In 2027, that maximum will be $2,400, up from $2,100 in 2026.

As you compare plans, keep that ceiling in mind and remember that your covered drug costs will not exceed $2,400.

Co-payment and co-insurance

A co-payment is a fixed amount you pay for a prescription, while co-insurance is the share of a drug’s cost that you pay yourself.

The size of those charges varies from plan to plan, so review them carefully before enrolling.

Help paying for Medicare Part D

If Part D costs are difficult to manage, several programs can make prescription drugs more affordable.

Extra Help is a federal program that assists lower-income beneficiaries with some prescription drug costs.

State Pharmaceutical Assistance Programs, or SPAPs, can also help with premiums and other cost-sharing.

In addition, some drug makers offer financial assistance for prescription medications. More information about these programs is available on the CMS website.

The bottom line

Many Medicare beneficiaries are likely to see some savings on Part D premiums in 2027, though others may not benefit as much.

Even people who pay less for premiums could face higher total costs if they do not compare plans carefully during open enrollment.

Open enrollment begins on Oct. 15 and continues through Dec. 7. Now is a good time to make a list of your medications and review your finances before choosing the right plan for 2027.

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