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Medicare Part D: A New Era of Affordable Drug Prices
Updated: Aug 22
Medicare is Finally Negotiating Drug Prices Directly with the Drug Manufacturers
As an Independent Medicare Broker for over 10 years, I’ve seen firsthand the struggles many face with high prescription drug prices. It's been frustrating to watch seniors pay so much for their medications. But now, there’s good news! Starting January 1, 2026, Medicare will lower the cost of the first 10 drugs. This change is long overdue and will be a blessing for many Americans who rely on Medicare every day.
But that’s not all! Beginning in 2027, Medicare will continue to lower the costs of at least 15 prescription medications each year for the next nine years. This is a significant step toward more affordable healthcare.
I hope this article is a quick read and that you find the information helpful. Our daily goal is to educate and inform others about Medicare and their choices. We’re here to answer any questions you might have!
Updates on Medicare's Next Wave of Re-Negotiated Drug Prices
Thanks to the Inflation Reduction Act, Medicare now has the authority to negotiate its own drug prices. The Centers for Medicare & Medicaid Services (CMS) announced they would negotiate new pricing for the 10 most popular prescription medications each year over the next 5 to 10 years.
In August 2022, President Biden signed the Inflation Reduction Act into law. This law improves Medicare by expanding benefits, lowering drug costs, and enhancing the program's sustainability for future generations. It provides meaningful financial relief for millions of people with Medicare. For the first time, Medicare can negotiate prices for certain high-expenditure, single-source drugs without direct generic or biosimilar competition.
The CMS selected 10 drugs covered under Medicare Part D for the first cycle of negotiations, effective in 2026. CMS entered into voluntary negotiations with the drug companies for those drugs.
Negotiation Process
The negotiation process was thorough. CMS held three meetings with each participating drug company to discuss offers and counteroffers. They reviewed evidence and sought a mutually acceptable price for each drug. During these discussions, CMS raised its offers, while many drug companies lowered their counteroffers.
In five cases, CMS and the drug companies reached an agreement during negotiation meetings. In four instances, CMS accepted a revised counteroffer from the drug companies. For the remaining five drugs, CMS sent a final written offer, which the companies accepted by the statutory deadline.
Impact of the Negotiated Prices
These negotiated prices have a significant impact. Between January 1, 2023, and December 31, 2023, around 8.8 million of the 54 million people with Medicare Part D coverage received these drugs for various conditions, including cardiovascular disease, diabetes, autoimmune diseases, and cancer. These drugs accounted for $56.2 billion in total Part D gross covered prescription drug costs during 2023, representing about 20% of the total.
During this same period, people with Medicare Part D incurred $18.9 billion in out-of-pocket costs, including $3.9 billion for drugs selected for negotiation.
Estimated Medicare Net Savings in 2023
If the negotiated prices had been in effect during 2023, they would have saved an estimated $6 billion in net covered prescription drug costs. This represents a 22% reduction in overall spending. When these negotiated prices go into effect in 2026, people enrolled in Medicare prescription drug coverage could save an estimated $1.5 billion.
2026 Prices After New Prices Were Negotiated for the 2026 Plan Year
Here are the negotiated prices for 2026:
Eliquis dropped 56% from $521.00 to $231.00.
Januvia dropped 79% from $527.00 to $113.00.
Fiasp & NovoLog Flex Pens dropped 76% from $495.00 to $119.00.
Farxiga dropped 68% from $556.00 to $178.50.
Enbrel dropped 67% from $7,106.00 to $2,355.00.
Jardiance dropped 66% from $573.00 to $169.00.
Stelara dropped 66% from $13,836.00 to $4,695.00.
Xarelto dropped 62% from $517.00 to $197.00.
Entresto dropped 53% from $628.00 to $295.00.
10. Imbruvica dropped 38% from $14,934.00 to $9,319.00.
These prices went into effect on January 1, 2026.
2026 Prices After New Prices Were Negotiated for the 2027 Plan Year
The following prices will go into effect on January 1, 2027:
Ozempic/Rybelsus/Wegovy is dropping 71% from $959.00 to $274.00.
Trelegy Elipta is dropping 73% from $654.00 to $175.00.
Xtandi is dropping 48% from $13,480.00 to $7,004.00.
Pomalyst is dropping 60% from $21,744.00 to $8,650.00.
Ofev is dropping 50% from $12,622.00 to $6,350.00.
Ibrance is dropping 50% from $15,741.00 to $7,871.00.
Linzess is dropping 75% from $539.00 to $136.00.
Calquence is dropping 40% from $14,228.00 to $8,600.00.
Austedo/Austedo XR is dropping 38% from $6,623.00 to $4,093.00.
10. Breo Elipta is dropping 83% from $397.00 to $67.00.
11. Xifaxan is dropping 63% from $2,696.00 to $1,000.00.
12. Vraylar is dropping 44% from $1,376.00 to $770.00.
13. Tradjenta is dropping 84% from $488.00 to $78.00.
14. Janumet/Janumet XR is dropping 85% from $526.00 to $80.00.
15. Otezla is dropping 65% from $4,722.00 to $1,650.00.
2027 Prices After New Prices Were Negotiated for the 2028 Plan Year
The medications listed below will have newly renegotiated pricing that takes effect on January 1, 2028:
Trulicity
Biktarvy
Orencia
Cosentyx
Erleada
Kisqali
Entyvio
Verzenio
Botox/Botox Cosmetic
10. Lenvima
11. Xolair
12. Rexulti
13. Xeljanz/Xeljanz XR
14. Anoro Ellipta
15. Cimzia
Many of you have asked why we chose the Red, White, and Blue Flag Logo and color palette. The answer is in honor of my father, Tillman Braden Jr. Dad retired as a Chief Master Sergeant and is laid to rest at Arlington National Cemetery in Washington, DC. My father taught me to be polite, sincere, well-informed, never late, and to understand what it means to serve others honorably.
As an Independent Medicare Broker, I’m honored to serve my friends, family, and neighbors in retirement. I genuinely love what I do. I’m patient and enjoy teaching and explaining things in a way that’s easy to follow.
In addition to being an Independent Medicare Broker serving clients in 12 states, I am also a Certified Medicare Planner. If I can ever be of service to you or any of your friends or family, please feel free to call, text, or email me at mike@bradenmedicare.com. You can also submit a contact request on our website at www.bradenmedicare.com.
