Medicare drug premiums jump 50% as open enrollment deadline nears
KFF analysis shows average costs for stand-alone plans will hit $51 in 2027, but beneficiaries can save hundreds by switching before Dec. 7.
By Jonathan Ramirez ·
The average monthly premium for stand-alone Medicare prescription drug plans will rise by 50% in 2027, according to a new analysis by the Kaiser Family Foundation. The cost will climb from $34 in 2026 to $51 next year for those who keep their current coverage. Beneficiaries have until Dec. 7 to switch to cheaper options during the open enrollment period to avoid the hike.
Robert Travis Scott of Abingdon, Virginia, acted quickly after his AARP-UnitedHealthcare plan announced a jump from $39.60 to $121.90 per month. Scott spent time comparing online options and found a Humana plan with similar benefits for $19.30. He estimated the switch will save him approximately $1,000 over the next year. "Yes, I am quite happy about that," Scott said regarding his new coverage.
Juliette Cubanski, director of the Program on Medicare Policy at KFF, warned that the stakes are higher this year for those who do not shop around. She noted that substantial premium increases mean beneficiaries who stay put could face significant financial burdens. The KFF analysis found that 10.4 million enrollees, or 76% of those in stand-alone plans without low-income subsidies, will pay more if they keep the same plan.
A major driver of the cost increase appears to be a decision by the Centers for Medicare & Medicaid Services in July. CMS ended a three-year pilot program early after it had only operated for two years. The pilot provided subsidies to stand-alone plans in 2025 and 2026 to help keep premiums down. CMS Administrator Mehmet Oz described the subsidy program as an insurance industry bailout. KFF noted that CMS had projected a much smaller national average increase of just $1 based on September data.
About 25 million people currently enroll in stand-alone Medicare drug plans, while roughly 31 million receive drug coverage through Medicare Advantage plans. Enrollees in Medicare Advantage plans will see much smaller increases. Their average drug cost will rise to $9 per month in 2027, an increase of less than $2. More than half of all Medicare beneficiaries are enrolled in these integrated plans.
Beyond monthly premiums, beneficiaries will face higher deductibles and less predictable out-of-pocket costs. The average deductible for stand-alone plans will rise to $643 in 2027, up from $540 this year. For Medicare Advantage plans, the deductible will average $489, up from $360. Most enrollees will also shift from fixed copayments to coinsurance, requiring them to pay a percentage of drug costs rather than a set fee. This change can make monthly expenses harder to forecast.
President Donald Trump has touted his administration's success in lowering pharmaceutical prices ahead of the Nov. 3 midterms. Speaking at a campaign rally in Ohio on Oct. 28, he claimed the U.S. now has the lowest drug prices anywhere in the world. "We have the lowest drug prices anywhere in the world," Trump said. "We went from the highest drug prices, we now have the lowest drug prices, favored nations, anywhere in the world." However, the actual cost for individual patients varies widely based on specific medications and insurance coverage.
