Medicare officials announced on July 28, 2026 that the projected monthly premium for Part D prescription drug coverage in 2027 is $41.33, according to the Medicare Trustees Report (Kiplinger). That is a notable jump from 2026, when the average stand-alone drug plan premium was $36, which had been down from $39 the year before (KFF).

Part of the reason is spending on expensive medications, including GLP-1 drugs used for diabetes and weight loss, according to a MarketWatch report published July 29, 2026 (MarketWatch). A Wall Street Journal report from July 28, 2026, referenced by MarketWatch, also flagged that Part D premiums are set to rise sharply.

A 2022 law called the Inflation Reduction Act made big changes to how Medicare drug coverage works, and those changes are being phased in through 2026. One key change: the out-of-pocket spending cap for drug costs dropped to $2,000 in 2025, then rose to $2,100 in 2026. That 5% increase is built into the law's design, not a reversal of the cap (AARP). The maximum deductible, the amount you pay before coverage kicks in, also went from $590 in 2025 to $615 in 2026. CMS has said the Medicare Advantage and Medicare Prescription Drug Programs are expected to remain stable in 2026 (CMS).

These changes carry a cost for insurers and taxpayers. CMS updated its payment formulas for 2027 to account for the law's changes (CMS). The agency also published final rules on April 2, 2026, setting operational guidelines for how plans must implement the new benefits (CMS). CMS projects a 2.48% increase in payments to Medicare Advantage plans for 2027, totaling over $13 billion (CMS).

On the enrollment side, 55% of eligible Medicare beneficiaries are in Medicare Advantage plans in 2026 (KFF). Humana added the most new Medicare Advantage enrollees among all insurers for the year (KFF). For stand-alone drug plans, beneficiaries have 8 to 12 options in 2026 (KFF), with several national plans charging premiums under $10 per month in many areas (KFF). The average premium for Medicare Advantage plans that include drug coverage rose modestly from $7 the prior year (KFF).

The low premiums seen in 2026 were not simply the result of market competition. Medicare Advantage plans receive rebate payments from Medicare, which has historically pushed down what beneficiaries see on their monthly bill (MarketWatch). The $41.33 figure for 2027 comes from the Trustees Report and reflects the national average monthly bid, the amount plans say it costs to provide coverage, before subsidies and other adjustments are applied. It serves as the benchmark for a "premium stabilization" mechanism that caps how much the base premium can rise year over year.

The broader context here is that Medicare drug coverage is in the middle of a major restructuring. The Inflation Reduction Act eliminated certain out-of-pocket costs in the catastrophic phase of coverage in 2024, shifted some financial responsibility to drug manufacturers, and created the $2,000 spending cap in 2025. Those changes forced insurers to recalculate what they expect to pay. Now that the cap is rising to $2,100 and expensive drugs like GLP-1s are driving up overall drug spending, the 2027 bids reflect costs that the 2026 numbers only partially captured. The jump from a $36 average premium in 2026 to a projected $41.33 in 2027 captures that adjustment, though the two numbers are not strictly comparable: one is an average of what stand-alone plans actually charged, the other is a projection of the base premium derived from what plans bid.

The takeaway is that the law's shift of costs from beneficiaries to insurers and drug companies is now showing up in premiums. The low premiums of 2026 appear to have been a transitional effect as plans adjusted to the new rules. The 2027 numbers point toward a new, higher baseline.