WASHINGTON, D.C. — The Centers for Medicare & Medicaid Services will end a temporary premium-stabilization program for standalone Medicare drug plans after 2026, returning Part D to traditional market conditions as insurers prepare their 2027 offerings.
CMS disclosed the change July 28 as part of its preliminary technical bid information for Medicare Part D plans. The data will be used by insurers to finalize prescription drug and Medicare Advantage offerings ahead of the annual open-enrollment period.
The Part D Premium Stabilization Demonstration began in 2025 after benefit changes required by the Inflation Reduction Act created uncertainty over standalone prescription drug plan premiums.
CMS said insurers now have sufficient experience operating under the redesigned Part D benefit to support the assumptions used in their 2027 bids. The voluntary demonstration will therefore conclude at the end of the 2026 contract year.
Ending the program removes a temporary federal mechanism intended to limit premium volatility and variation while insurers adjusted to the benefit changes. CMS did not provide preliminary plan-specific premiums or estimate how ending the demonstration could affect what beneficiaries pay in 2027.
The agency set the 2027 national average monthly bid amount at $296.05. The figure represents the enrollment-weighted average of Part D plan bids for the basic prescription drug benefit and is used to calculate federal subsidies paid to plans.
The national base beneficiary premium will be $41.33 in 2027. That amount is the starting point used to calculate each plan’s basic Part D premium rather than the final monthly charge paid by every enrollee.
Under the Inflation Reduction Act, annual increases in the base beneficiary premium are capped at 6% from 2024 through 2029.
CMS described the figures as preliminary technical information. Final premiums will vary by plan and may reflect additional plan-specific factors.
The agency expects to release the finalized 2027 Medicare Advantage and Part D plan landscape in mid-to-late September. Final national average premiums and other enrollment information are also scheduled for release in September.
Support the local news that supports Chester County. MyChesCo delivers reliable, fact-based reporting and essential community resources—free for everyone. If you value that, click here to become a patron today.