For Two Years, a Federal Program Held Down Part D Premiums. It Ends After December.
CMS is winding down the subsidy that cushioned standalone drug-plan premiums. Here’s the number to look for in September — and the free window to do something about it.
If you have a standalone Medicare drug plan, you’ve been getting a discount for two years and probably never knew it. A temporary federal program cut the average standalone Part D premium by $26 a month in 2025 and $16 a month in 2026 (MedPAC, March 2026 Report to Congress, as cited by KFF, July 29, 2026). On July 28, 2026, CMS announced the program ends after this year.
That’s roughly $192 of cushion coming out of the average premium in 2027.
What actually happened
The program has a mouthful of a name: the Part D Premium Stabilization Demonstration. CMS launched it in 2025, when changes under the Inflation Reduction Act shifted more drug costs onto the plans themselves and standalone premiums started climbing (KFF, July 29, 2026).
It did two things for the plans that opted in. It knocked a set amount off the base premium used to price every plan — $15 in 2025, $10 in 2026. And it capped how much a participating plan could raise your monthly premium from one year to the next: $35 in 2025, $50 in 2026 (KFF, July 29, 2026).
CMS says the demonstration has done its job. In its July 28 fact sheet, the agency said plan sponsors now have “sufficient experience under the redesigned Part D benefit,” and that it will end the demonstration “to return the program to operating under traditional market conditions in CY 2027” (CMS, “Medicare Part D 2027 National Average Monthly Bid Amount Information,” July 28, 2026).
One number is already public. The national base beneficiary premium — the starting point plans build from, not what you pay — rises to $41.33 for 2027, up from $38.99 (CMS, July 28, 2026).
What this means for your wallet
Two things matter here, and the second one is getting almost no coverage.
First, the averages. About 25 million people are in standalone Part D plans (Managed Healthcare Executive, July 30, 2026). CMS Administrator Mehmet Oz said publicly that premiums “will go up by less than $10 for most Medicare recipients, with many even seeing lower premiums.” KFF’s Medicare program director, Juliette Cubanski, framed it differently: some enrollees “could face a larger premium increase for drug coverage next year than in recent years,” and plan-specific amounts aren’t known yet (KFF, July 29, 2026). Both statements can be true at once. Averages hide the outliers, and you are not an average.
Second — and this is the part to circle — the ceiling on the increase is what’s disappearing. In 2026, a participating standalone plan could not raise your premium more than $50 a month over the prior year, whatever happened to its costs. Under a $50 cap, a $20 plan could not become a $90 plan in one year. For 2027 there is no such cap. That doesn’t predict what your plan will do. It removes the thing that was standing in the way.
Nobody knows your number yet — not your plan’s agent, not us. CMS says it will release final 2027 premiums with the full plan landscape in mid-to-late September (CMS, July 28, 2026).
The fix, and it’s a real one
Here’s the good news. Switching a drug plan is one of the easiest things Medicare lets you do.
Unlike Medigap, Part D has no health underwriting. No insurer can turn you down or charge you more because of your prescriptions or your medical history when you switch during open enrollment. Your window is October 15 through December 7, and the change takes effect January 1, 2027 (Medicare.gov).
So the sequence is simple:
- By September 30: Your plan must mail its Annual Notice of Change. Find the 2027 premium line and hold it next to what you pay now (Medicare.gov).
- Mid-to-late September: CMS posts the full 2027 plan landscape, so you can see what else is out there.
- October 15 to December 7: Run your actual prescriptions and your actual pharmacy through the Plan Finder at Medicare.gov, or call 1-800-MEDICARE (1-800-633-4227), or your free State Health Insurance Assistance Program (SHIP) counselor.
Do nothing and most plans renew you automatically into the 2027 version, at the 2027 price.
One more thing, because fall is when the phone starts ringing. Senior Savers is independent — we’re not Medicare, not your plan, and we’re not selling you one. Nobody legitimate needs to cold-call you about your Part D premium. If someone does, hang up and call the number printed on your own card, on your own schedule.
The takeaway
The cushion is coming out from under standalone drug plan premiums next year. You’ll see your own number in September, and you’ll have from October 15 to December 7 to change your mind — free, and with no health questions asked. Put that letter somewhere you’ll actually read it.
This is information, not financial, medical, or legal advice — for your specific coverage, contact Medicare or a licensed SHIP counselor.
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Sources: CMS, “Medicare Part D 2027 National Average Monthly Bid Amount Information,” fact sheet, July 28, 2026; KFF, Juliette Cubanski, “CMS’s Decision to End Temporary Subsidies to Medicare’s Stand-Alone Drug Plans Could Mean Larger Premium Increases for Some Beneficiaries Next Year,” July 29, 2026, citing MedPAC’s March 2026 Report to Congress; Managed Healthcare Executive, “CMS sets the 2027 Part D bid amount at $296.05, will end premium subsidy program,” July 30, 2026; Medicare.gov, open enrollment and Annual Notice of Change guidance (accessed August 31, 2026).
