Medicare Prescription Drug Plan Premiums Are Changing for 2027: What You Need to Know
If you have a standalone Medicare prescription drug plan, you may be opening your Annual Notice of Change (ANOC) this fall and wondering why your plan looks so different for 2027.
For some people, the biggest surprise may be the monthly premium.
You may be thinking, “Why is my prescription drug plan getting so expensive? I barely take any prescriptions!”
You aren't alone. Medicare prescription drug plans can change from year to year, and 2027 brings an important change to the Medicare Part D market that may affect the premiums and plan choices available to Medicare beneficiaries.
At Utah Avenue Insurance, we recommend reviewing your prescription drug coverage every year—even if your medications haven't changed.
Why Are Medicare Prescription Drug Plan Premiums Changing in 2027?
One of the changes affecting standalone Medicare Part D plans in 2027 is the end of a temporary government program called the Part D Premium Stabilization Demonstration.
The Centers for Medicare & Medicaid Services (CMS) introduced this temporary program in 2025 as Medicare implemented major changes to the Part D prescription drug benefit. The goal was to help reduce large year-to-year changes in premiums for participating standalone prescription drug plans.
The program continued in 2026, although the amount of premium stabilization was reduced.
CMS has now announced that the demonstration will end after 2026, meaning standalone Part D plans will return to traditional market conditions for 2027.
That does not mean everyone's prescription drug plan premium will increase by the same amount. Some plans may increase more than others, and plan availability, benefits and premiums can vary depending on where you live.
This is one reason it is especially important to review your plan for 2027 instead of simply allowing it to renew automatically.
What Is the Medicare Part D Base Beneficiary Premium for 2027?
CMS has announced that the 2027 Part D base beneficiary premium is $41.33, compared with $38.99 for 2026.
But this number can be confusing.
The $41.33 base beneficiary premium does not mean that every Medicare Part D plan will cost $41.33 per month. It is a national figure used as part of the calculation of plan-specific basic Part D premiums.
Your actual monthly premium will depend on the prescription drug plan you choose and other factors.
So if you receive an ANOC showing a premium that is much higher—or lower—than $41.33, that doesn't necessarily mean there is an error.
Your ANOC Is Important This Year
Medicare plans send an Annual Notice of Change, commonly called an ANOC, each fall. This document tells you what will change with your plan beginning January 1.
Don't throw this letter away!
Your ANOC can show changes to your:
Monthly premium
Prescription drug deductible
Copays and coinsurance
Covered medications
Drug tiers
Pharmacy network
Other plan rules and benefits
A plan that worked wonderfully for you in 2026 may not necessarily be your best option for 2027.
Don't Compare Prescription Drug Plans by Premium Alone
It can be tempting to look for the prescription drug plan with the lowest monthly premium and stop there.
But the cheapest premium doesn't always mean the lowest overall cost.
For example, one plan might cost less each month but charge considerably more for one of your medications. Another plan might have a higher premium but offer much better pricing for the prescriptions you take regularly.
When we compare Medicare prescription drug plans for our clients, we want to look at the whole picture.
Is Your Medication on the Formulary?
A formulary is the list of prescription medications covered by a Medicare drug plan.
Drug formularies can vary from one plan to another, and they can change from year to year. You want to make sure your current medications are covered by the plan you're considering and check what tier each medication falls into.
What Will Your Prescriptions Actually Cost?
Look beyond the monthly premium and consider your copays and coinsurance.
A difference of a few dollars in monthly premium may not matter very much if another plan will save you significantly more on the medications you fill throughout the year.
Does the Plan Have a Deductible?
Check the plan's prescription drug deductible and, just as importantly, which medications are subject to that deductible.
Understanding when the deductible applies can help you avoid an unpleasant surprise at the pharmacy in January.
Are You Using the Right Pharmacy?
Your pharmacy can make a big difference in what you pay.
Medicare prescription drug plans have pharmacy networks, and some plans have preferred in-network pharmacies where members may receive lower copays or coinsurance.
The pharmacy you've used for years may not necessarily be the least expensive pharmacy with your new plan.
What Is Your Estimated Total Cost for the Year?
This is one of the most important numbers to consider.
Instead of asking only:
“Which plan has the cheapest premium?”
We also want to ask:
“Which plan is likely to cost me the least overall based on the medications I actually take?”
That means considering your premiums, deductible and estimated prescription costs together.
“But I Don't Take Any Prescriptions. Why Should I Pay So Much for a Drug Plan?”
We hear this question frequently, especially from healthy Medicare beneficiaries who take few or no medications.
If your Part D premium increases significantly, it may be tempting to simply cancel the plan.
Be careful before doing that.
Going without Medicare Part D or other creditable prescription drug coverage for too long can potentially result in a Medicare Part D late enrollment penalty if you decide to enroll again later.
We'll cover the Part D late enrollment penalty in more detail in another article, because it's important to understand the rules before dropping prescription coverage simply to save money on the monthly premium.
There may also be lower-cost Part D options available in your area that make more sense for someone who currently takes few or no medications.
Don't Automatically Renew Your Medicare Prescription Drug Plan for 2027
Prescription drug plans are one area of Medicare where we believe an annual review can be especially valuable.
Your medications can change.
Your plan's formulary can change.
Your pharmacy costs can change.
Your deductible can change.
And your monthly premium can change.
Even if you've been happy with the same prescription drug plan for several years, 2027 is a good year to take another look at your options.
Let Utah Avenue Insurance Help You Review Your 2027 Medicare Drug Coverage
You don't have to figure all of this out by yourself.
At Utah Avenue Insurance, our local Medicare agents can help you review your current prescription drug plan, enter your medications, compare available plans and look at the estimated costs for the year.
We'll help you look beyond just the monthly premium and consider your prescriptions, pharmacies, deductible, copays and estimated annual costs when comparing your options.
If your 2027 Annual Notice of Change shows that your prescription drug plan is getting more expensive, don't panic—and don't cancel your coverage without understanding your options first.
Schedule an appointment with a local Utah Avenue Insurance agent and let us help you review your Medicare prescription drug coverage for 2027.
Better coverage starts here.
