CMS said the Biden-era program will expire at year-end after costing $9.8 billion in 2025 and 2026, while critics say the move undercuts President Trump's pledge to lower drug costs.
CMS said Biden-era subsidies for Medicare Part D will expire at the end of the year and will not be offered in 2027, ending a program launched in 2024 that was expected to last at least three years. The broader Part D redesign under the Biden administration also set a $2,000 annual cap on out-of-pocket prescription drug spending and allowed Medicare to negotiate prices for certain high-cost drugs. New monthly cost estimates are due in mid- to late-September, but the national average monthly bid amount for 2027 is projected at $296.05, up from $239.27 last year, after a program that the Government Accountability Office said cost $9.8 billion across 2025 and 2026; about 23 million people were enrolled in standalone Part D plans in 2025. Critics including KFF's Juliette Cubanski, Protect our Care's Leslie Dach and the Center for Medicare Advocacy's David Lipschutz said the move could lift premiums for millions of seniors, squeeze household budgets and favor Medicare Advantage, even though it may produce federal savings. CMS Administrator Dr. Mehmet Oz said the Biden administration had directed "BILLIONS of taxpayer money DIRECTLY to Big Insurance Companies" and argued the market has stabilized, with most beneficiaries seeing lower premiums, no change or increases of less than $10. The decision lands as President Trump promotes cheaper drugs through TrumpRx and "most-favored-nation" deals, and after Republicans in Congress let ObamaCare subsidies expire.