Medicare Ends Part D Premium Subsidy Program

On January 1, 2027, the Centers for Medicare & Medicaid Services (CMS) Medicare Part D Premium Stabilization Demonstration will end. The termination will likely result in higher premiums for some Medicare beneficiaries.

The Medicare Part D Premium Stabilization Demonstration was implemented in calendar year (CY) 2025 and applied only to standalone prescription drug plans (PDPs). It was created while the plans were implementing changes to the Part D benefit under the Inflation Reduction Act (IRA). The IRA capped out-of-pocket drug spending for Part D enrollees and shifted more costs to Part D plan sponsors, leading to higher expected . . .