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Medicare’s 2026 Drug Price Negotiations: A New Era of Affordability

Starting January 1, 2026, Medicare will implement its first-ever negotiated prescription drug prices; a historic change that could lower costs for millions of beneficiaries. In this post, we discuss Medicare’s 2026 Drug Price Negotiations. This is a direct result of the Inflation Reduction Act of 2022, which for the first time gave Medicare the authority to negotiate the prices of certain high-cost medications.

Why This Matters

For decades, Medicare was prohibited from negotiating directly with drug manufacturers. Instead, it relied on private Part D plan sponsors to manage drug costs. The 2026 negotiations mark a turning point. Medicare will now establish a Maximum Fair Price (MFP) for select drugs, reducing both what the government pays and what beneficiaries spend at the pharmacy counter.

• Projected Medicare savings: About $6 billion in 2026
• Projected out-of-pocket savings for beneficiaries: About $1.5 billion

The First 10 Drugs Negotiated for 2026

CMS chose these drugs because; they are some of the highest-cost Part D medications. In addition; there are no generic or biosimilar medications available, and are widely prescribed.

1. Eliquis – blood thinner for preventing stroke and blood clots
2. Xarelto – blood thinner for reducing risk of clotting
3. Januvia – diabetes medication (DPP-4 inhibitor)
4. Jardiance – diabetes, heart failure treatment (SGLT2 inhibitor)
5. Farxiga – diabetes, heart failure, kidney disease treatment (SGLT2 inhibitor)
6. Entresto – heart failure medication
7. Enbrel – rheumatoid arthritis and autoimmune conditions
8. Stelara – psoriasis, Crohn’s disease, ulcerative colitis
9. Imbruvica – blood cancers (leukemias and lymphomas)
10. NovoLog / Fiasp – fast-acting insulin for diabetes

How Beneficiaries Will Benefit

• Lower copays and coinsurance: Out-of-pocket costs will drop for patients taking these medications.
• Broader affordability: Even if you don’t take one of these drugs, Medicare’s overall savings help stabilize Part D premiums.
• Expanded impact in future years: In 2027 and beyond, CMS has scheduled more drugs for negotiation.

Watch a YouTube video on the Inflation Reduction Act and Changes to Medicare

What Comes Next

• 2027: Fifteen more high-spend drugs are already set to be negotiated, with prices effective January 1, 2027.
• 2028 and beyond: CMS will continue expanding the program, selecting additional drugs each year.
• Rulemaking: Starting in 2026, the program shifts to a formal rulemaking process, adding more transparency.

Challenges and Legal Pushback

The pharmaceutical industry has filed multiple lawsuits challenging Medicare’s new authority, arguing that price negotiations are unconstitutional. At the same time, new legislation has delayed or exempted certain blockbuster drugs, such as Keytruda, from early negotiation. While these challenges could affect the program’s scope, the 2026 savings are locked in and moving forward.

What You Should Do

• Review your Medicare Part D plan during open enrollment to ensure it covers your prescriptions at the lowest cost.
• Talk to your agent if you take any of the drugs on the 2026 negotiation list, you could see meaningful savings.
• Stay informed about future negotiation cycles, as more medications are added each year.

Agents:

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Stay updated on agent events and information

Medicare’s 2026 drug price negotiations represent a historic shift in prescription drug policy. For the first time, Medicare is actively reducing the cost of some of the most expensive and widely used medications in the program. While legal and political challenges remain, the immediate savings for beneficiaries and taxpayers are significant—and this is only the beginning.

Medicare Prescription Drug Coverage: Why Agents Should Guide Their Clients

When it comes to Medicare, prescription drug coverage (Part D) is one of the most important decisions beneficiaries will make. Prescription costs can have a major impact on a person’s budget and quality of life, and the right plan can save thousands of dollars each year.

For Medicare agents, helping clients navigate their Part D options isn’t always about commissions, it’s about building long-term trust, maintaining strong relationships, and positioning yourself as a valuable resource.

Why Agents Should Assist With Part D Decisions

Client Trust and Retention

Even if you aren’t earning a commission on every Medicare Prescription Drug Plan, guiding your clients through their choices shows that you care about their overall well-being. Beneficiaries notice when an agent takes the time to help without a financial incentive. That trust builds loyalty, which translates to long-term client retention.

The Importance of Enrolling on Time

Many beneficiaries don’t realize that failing to enroll in Medicare prescription drug coverage when first eligible or going without creditable drug coverage for more than 63 continuous days can lead to a lifetime late enrollment penalty (LEP). This penalty is added to the monthly Part D premium and grows the longer someone goes without coverage.

As an agent, explaining this to clients ensures they understand the financial consequences of delaying enrollment. Helping them avoid unnecessary penalties is another way to build trust and showcase your expertise.

Strengthening Relationships

By reviewing drug coverage options, you’re demonstrating your commitment to helping clients find the most cost-effective and comprehensive plan. This not only makes clients more likely to refer friends and family, but it also establishes you as their go-to resource for future Medicare needs.

Positioning Yourself for Additional Sales Opportunities

Helping with prescription drug coverage is often the first step toward uncovering other gaps in coverage. Once trust is built, clients may be more open to discussing:

• Medicare Supplement plans (Medigap): To help with out-of-pocket costs not covered by Original Medicare.
• Ancillary products: Such as dental, vision, hearing, short-term care, or critical illness coverage. These plans can provide extra protection and peace of mind for expenses Medicare doesn’t cover.

Watch a quick YouTube video on how to deal with non-commissionable PDP plans

Showing That You Put Clients First

Beneficiaries can feel overwhelmed by the number of plan choices. When you guide them, without focusing on commissions, you prove that your priority is their best interest. This approach differentiates you from competitors and builds long-term credibility.

Stay updated on agent events and information

The Bottom Line

Helping clients choose the right Medicare Prescription Drug Plan isn’t just about filling out enrollment forms; it’s about demonstrating integrity, earning trust, and protecting clients from costly mistakes like lifetime penalties.

Even when commissions aren’t involved, the time you invest in helping clients with their Part D decisions will pay off in other ways: stronger retention, new sales opportunities, and a reputation for truly putting clients first. With the client’s permission, agents can run the comparison and send the recommendation through a quick email. If the best option is a non-commissionable plan, clients can easily self-enroll through medicare.gov or a phone call to the carrier.

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Please keep in mind, it is always important to follow all CMS enrollment rules.

By taking a holistic approach, you not only help clients get the coverage they need, you also ensure your business continues to grow through loyalty, referrals, and expanded product offerings.

Because diabetes affects millions of Americans, understanding Medicare diabetes coverage is extremely important to both agents and those affected by diabetes. For diabetics, proper management and access to supplies is essential to maintaining health and quality of life. Fortunately, Medicare provides comprehensive coverage for diabetes-related services and supplies. It’s important to understand what Medicare covers and how to maximize benefits.

Medicare Part B

Medicare Part B covers a variety of diabetes-related supplies and services, including:

Blood Sugar Testing Supplies – This includes blood glucose monitors, test strips, lancets, and control solutions. Medicare generally covers up to 300 test strips and lancets every three months for insulin-dependent beneficiaries and up to 100 for non-insulin users.

Continuous Glucose Monitors (CGMs) – Medicare covers therapeutic CGMs and related supplies for qualifying individuals who meet specific criteria.

Insulin Pumps and Insulin for Pumps – Medicare covers insulin pumps as durable medical equipment (DME) and the insulin used in these pumps.

Medical Nutrition Therapy (MNT) – Beneficiaries with diabetes may receive MNT services, including nutritional assessment and counseling.

Diabetes Screenings – Medicare covers two diabetes screenings per year for beneficiaries at risk of developing diabetes.

Diabetes Self-Management Training (DSMT) – A critical education service that helps patients learn how to manage their diabetes effectively.

Medicare Part D: Prescription Drug Coverage

While Medicare Part B covers insulin used in pumps, Medicare Part D (Prescription Drug Plans) covers most other types of insulin, as well as oral diabetes medications, needles, syringes, and certain related supplies. Coverage may vary based on the specific Part D plan, so it’s important to review formulary lists and copayment amounts before enrolling in a plan.

Medicare Advantage (Part C) and Supplemental Coverage

Medicare Advantage (MA) plans must cover everything Original Medicare (Part A and Part B) covers but often include additional benefits, such as expanded prescription drug coverage, wellness programs, and cost-sharing assistance for diabetes management. Some plans may also offer broad access to CGMs and other advanced diabetes care.

How to get Medicare covered diabetes supplies

It is important to always use suppliers and pharmacies that are part of your Medicare plan’s network. Check with the plan provider for specific requirements and preferred providers. Beneficiaries must obtain a prescription from their doctor for blood sugar testing supplies.

Click here to download Medicare coverage of diabetes supplies, services & prevention programs

Medicare provides extensive support for individuals with diabetes, but navigating coverage details can be complex. Understanding what’s included under Medicare Part B, Part D, and Medicare Advantage plans helps beneficiaries make informed decisions and access necessary supplies for effective diabetes management.

The Medicare LIS beneficiaries PDP reassignment is completed each year by CMS. CMS reassigns PDP plans for LIS beneficiaries that go over regional LIS benchmarks and do not comply with the accepted premium amount for the following calendar year.

In some cases CMS will also reassign PDPs plans that are terminating in a specified area. This action also applies to MA plans when they are reducing the area they provide service in.  In either of these instances, Medicare beneficiaries are enrolled in an alternate plan that is compliant with the LIS benchmarks for the specific area.

What is LIS

LIS (Low Income Subsidy) provides financial assistance with Medicare prescription drug coverage. It is available only to those individuals who qualify based on their income and assets.

Maintaining LIS status

There are four different groups of individuals that have LIS and may require assistance to understand and maintain their status. Each year, CMS sends notices out explaining potential changes to each group on specific colors of paper that corresponds to the group they are in.

Medicare LIS Beneficiaries PDP Reassignment and types of notices

The first group

These are individuals who do not automatically qualify for LIS. In September CMS mails a notice on grey paper to anyone who will no longer automatically receive LIS benefits. Those who receive the grey notice may be eligible for LIS. but they must send in a new application.

Learn more about the Grey notice

The grey notice is an application that explains why their LIS benefit renewal is no longer automatic and requests they send the application in. A postage-paid pre addressed envelope is included with the grey application form.

The second group

Each October, CMS sends out an orange notice to individuals who’s LIS co-payment is changing. These people still qualify for extra help, but the amount will be different than it is currently.

The third group

Individuals in this group receive a blue notice in early November. The blue notice explains that the LIS beneficiaries will be assigned a new Part D plan starting January 1st.  

People who are automatically reassigned qualify for a full (100%) subsidy and are currently enrolled in a PDP plan that is raising it’s premium over the approved low premium amount. These individuals were enrolled in their current PDP coverage by CMS. CMS also auto reassigns those who qualify for LIS and are enrolled in a PDP that is leaving the Medicare program.

The fourth group

People who chose their own PDP coverage plan (choosers) receive a notice on tan paper in early November. This notice is sent to those who receive a full (100%) premium subsidy and will have an increase in premium amount. These people will not be reassigned a new PDP plan because they chose their own plan. Therefore individuals can stay in their current plan and pay a higher rate or choose another plan for themselves. The notice includes plan options that provide plans that offer a $0 premium for the beneficiary.

Choosers

What are choosers; they are LIS eligible individuals who receive a 100% premium subsidy and pick their own prescription drug plan. When this is the case, CMS does not enroll these people into a new plan. Although if their chosen plan either terminates or reduces its service area, CMS will enroll them in a plan to avoid a loss of Part D coverage. 

View an example of the tan choosers notice

Click here to view a complete guide to CMS consumer mailings 2024/2025

Medicare Part D 2024

In this post, we will discuss some important information about Medicare Part D 2024.

Medicare Part D plans cover the cost of prescription drugs for Medicare enrollees.  Private insurance companies offer these plans to beneficiaries.   In order to remain complaint, all plan providers must follow CMS’ rules.

Prescription plan costs

There are a few costs associated with Medicare prescription plan coverage.  One of those costs include the monthly plan premium, this amount can range greatly depending on the plan and carrier.  Beneficiaries can opt to have the premium deducted from their monthly Social Security payment.  If the beneficiary has a greater than average income, they may be subject to an IRMAA, an adjusted premium amount based on income.  The premium may also be adjusted for those who have a lower-than-average income and qualify for Extra Help.

Other costs associated with Part D prescription are co-pays and coinsurance amounts paid at the pharmacy.  Many plans also include an annual deductible.  In 2024, the maximum annual deductible has increased from $505 in 2023 to $545 for 2024.

For those who neglect to sign up for a Medicare Part D plan on time, a late enrollment penalty is added to the monthly cost.  The penalty applies to anyone who goes without creditable Part D coverage for a period of 63 or more days.  CMS applies the penalty for as long as the beneficiary has Part D coverage.

Changes for Medicare Part D for 2024 

Because of the Inflation Reduction Act that was signed into law in 2022, there will be changes to the Medicare Part D program.   One important change has to do with the cost Medicare beneficiaries pay for prescription drugs.

 Click here to learn about prescription drug caps

Here are some of the changes in place for 2024:

In 2024, Medicare PDP members who reach the catastrophic phase ($8,000 in 2024) will not pay any additional out-of-pocket costs for the remainder of the year.  This means they are no longer subject to a 5% copay.

PDP plans are no longer able to raise their premiums over 6% per year starting in 2024.

Beneficiaries who use insulin will pay no more than $35 for a 1-month supply for covered insulin brands.  It is important to check your plan’s formulary to confirm which brands they include.  This pricing is in effect until the end of 2025.

Medicare covers many adult vaccines at no cost to Medicare beneficiaries.  this includes the Shingles vaccine as well as TDAP (tetanus vaccine), Covid, flu vaccine, Hepatitis A and many others.

More Medicare beneficiaries will qualify for Extra Help to pay for their health care needs in 2024. This is because beneficiaries with an income of up to 150% of the federal poverty level (up from 135% in 2023) may be qualified for the Part D Extra Help.  This program pays the Part D annual deductible, monthly premium and ensures beneficiaries pay a lower cost for generic and brand name drugs.

A few changes to prescription drug plans in 2025 and 2026

In 2025, one of the changes to the Part D program is a $2,000 out-of-pocket maximum in place for PDP beneficiaries.  CMS is also starting a prescription payment plan program.  The program is referred to as “smoothing” and begins Jan 1, 2025.  This program gives beneficiaries an opportunity the spread out the cost of prescription medications out over the year by using a payment plan.

Click here to learn more about the prescription payment program

In 2026 price negotiations will begin for expensive drugs that have no generic alternatives.

Learn the details of the price negotiation program

To view a comprehensive guide to all the ins and outs of Medicare for 2024, click this link and  download a copy of CMS Medicare and You handbook for 2024.    Information on Medicare Part D starts around page 79.

Watch a quick YouTube video on the drug cap proposed for 2025

Take a look at some of the other compliance updates CMS has in place or has proposed for agents :

Watch a quick YouTube video on the CMS proposed rule CMS 4205-P an how this could effect our business

Find out more about the 2024 CMS call recording requirements

Make sure you are up-to-date with the SOA rules – click here and learn more

Take a look at our video on TPMO rules for 2024

If you are unsure of the differences between an educational event and a sales event, click here.  You may also want to read our blog on “Things you can’t say when selling Medicare“.

If you already have a contract with Crowe and want to add a carrier, click here

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Please note: agents who offer Medicare Part D plans need to complete annual carrier certifications as well as AHIP before they can offer the plans.  AHIP is an annual certification that CMS requires.  It includes marketing and compliance guidelines as well as FWA laws.

If you don’t follow the Medicare marketing rules, you risk losing commissions, termination of your contracts, losing your license and receiving fines.

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Wellcare prescription plans

Because the ability to access affordable prescription medications is crucial to maintaining good health, beneficiaries must be aware of all their options.  In order to help individuals make an informed decision, we will discuss some benefits of the WellCare prescription drug plans.

Important; CMS has guidelines in place to regulate the types of medications that prescription drug plan providers must cover.  This includes a minimum standard of benefits for providers to follow. The formulary for each plan Each plan meets the requirements as required by law. Because each plan differs, the cost and drugs included in the formulary can vary.

Find out about the Medicare drug price negotiations

Although Wellcare offers three different plan choices, it is important to review each plan formulary and make sure it provides coverage to fit the prescription needs for anyone considering enrollment.

The three Wellcare PDP plans for 2024

Some features of the Wellcare prescription plans

Wellcare has no or low premium plans available to provide coverage for individuals who qualify for Extra Help.  These plans are available in all states and offer low or no copays when enrollees purchase prescriptions from preferred pharmacies.

Some Wellcare plans include no deductible, so plans cover prescriptions on day one.

Wellcare has a nationwide network of preferred pharmacies that includes thousands of national, regional and local pharmacy chains. It also includes grocers and independent pharmacies as well.  These relationships help plan members save money on prescription drugs.

Use this link to the Wellcare preferred pharmacy tool and find a local in-network pharmacy.

Find a preferred pharmacy tool to find a local pharmacy.

The member service representatives are available either online at wellcare.com/PDP or by phone at 866-822-1339 (TTY – 711) during the hours of 8am – 8pm EST Monday – Friday. They can provide answers to members coverage or medication questions.

If you want to view the plan formulary (complete list of drugs each plan covers), visit Wellcare’s website or contact their member services department.

Aetna SilverScript

For Medicare beneficiaries who are on Original Medicare or Original Medicare and a Medicare Supplement plan, it is a good idea to add a Medicare prescription drug plan to cover your prescriptions. One prescription drug plan that provides coverage to many beneficiaries is the Aetna SilverScript Plan.  In this post, we will go over some of the benefits these plans provide.

Aetna SilverScript Overview

Aetna SilverScript is a Medicare prescription drug plan provider.  It is part of the Aetna family of medical insurance plans. These plans are designed to work with Original Medicare or Medicare supplement plans and cannot be sold to anyone who is currently enrolled in a Medicare Advantage plan and wants to remain on that plan.

Eligibility for prescription plan enrollment

In order for a beneficiary to eligible for enrollment in any PDP plan, they must be enrolled in either Medicare Part A or both Medicare Part A & Part B.  Beneficiaries must also live in the service area of the plan they want to enroll in.

There are specific times you must use to enroll in a Medicare prescription drug plan (Part D).

1. During your initial enrollment period (IEP).
2. Enroll during the Annual Election period (AEP).
3. If you have a Medicare Advantage plan, you can enroll during the Medicare Advantage Open Enrollment Period (MAOEP).
4. When you qualify for a special election period (SEP).

Learn more about Medicare’s enrollment periods

Aetna SilverScript plans

In 2024, Aetna is offering 3 different plan choices:

1. First, the SilverScript Smart Saver plan – This plan has an average monthly premium of $11.19, Please note, this cost is an average.  Actual cost depends on the service area. This plan offers a $0 copay for a 30-day supply of Tier 1 drugs.   There are almost 600 drugs that fall into Tier 1 and Tier 2 on this plan, drugs on tier 2 have a copay amount of $5.  The SilverScript Smart Saver plan also provides members a low deductible of $280 for Tier 2 through Tier 5 drugs.
2. Second, the SilverScript Choice plan – Members of this plan pay an average monthly premium of $46.59.  Please note, this cost is an average and the actual cost depends on the service area.  There is a $545 deductible applied to all tiers of this plan.  The copay amount for Tier 1 drugs is $2 while the Tier 2 copay amount is $7.  Beneficiaries who qualify for Extra Help do not have to pay a plan premium.
3. Third, the SilverScript Plus plan – The premium for this plan averages $103.51 although the actual amount varies depending on the service area.  This is a top-notch plan that offers members a $0 deductible for both Tier 1 and Tier 2 drugs.  On this plan, there is a $0 copay for many prescription vitamins, minerals and some other types of drugs. members also receive additional gap coverage.

Watch a video on Drug plan changes for 2024

Features of Aetna SilverScript PDP plans

Variety of Plans

Aetna offers a wide range of prescription drug coverage options.  This allows beneficiaries to choose a plan that aligns with their personal needs and budget.  Each plan covers different medications at varying costs.

Extensive Network of Pharmacies

All Aetna SilverScript plans offer an extensive network of pharmacies.  This gives beneficiaries the flexibility and convenience to choose where they fill their prescriptions.

Mail-Order Options

The Aetna SilverScript plans provide the option for mail-order prescriptions, allowing beneficiaries to receive a 90-day supply of their medications conveniently delivered to their door.

Members of Aetna SilverScript PDP plans can visit AetnaMedicare.com to access and print plan materials, pay their plan premiums, check coverage of their drugs or locate a local, preferred pharmacy.

Aetna also provides members a secure site, Caremark.com, to find prescription prices, see possible prescription savings options, sign up for mail delivery, check order status and more.

Click here to learn why you should use a Medicare agent

To see if these plans are right for you, check with a licensed Medicare agent who can ensure your coverage needs are properly met by either these plans or another one.

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Medicare Part D enrollment period

Medicare plans all have specific periods of time that beneficiaries can use to enroll in each type of plan.  Medicare Part D (prescription drug coverage) is no different.  There is more than one Medicare Part D enrollment period available to beneficiaries.

Please note: Beneficiaries can get Medicare Part D coverage from either a stand-alone PDP plan or from an MAPD plan.

Why enrolling in Part D is important

If your client asks why they should enroll in Part D coverage, you need to tell them about the late enrollment penalty (LEP). Once a beneficiary incurs a penalty, they have to pay it for as long as they have Medicare Part D coverage.  It is added to The Medicare Part D plan premium.  This penalty amount is determined by the number of months the beneficiary has gone without creditable drug coverage.  The penalty applies after a beneficiary goes 63 days or more without creditable coverage. Creditable coverage means a drug plan that provides coverage at least equal to what Medicare part D provides.

Here are a few instances that can result in an LEP

1. When a client Neglects to enroll in Part D as soon as they are eligible.  Enrollment in Medicare Part A & Part B is a great indicator of when to enroll in part D coverage.  It is important to enroll even if the client is not currently taking any prescription drugs.
2. If the beneficiary loses other health coverage such as employer coverage, it is important beneficiaries do not go without creditable coverage for 63 days in a row.
3. Once clients are eligible for Medicare, be sure they maintain records of creditable coverage in the event Medicare asks for proof of previous coverage.

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What Doesn’t Medicare Part D Cover?

Medicare Part D is prescription drug coverage, provided by private insurance companies licensed by the federal government. There are certain kinds of drugs that are excluded from coverage, however. Medicare coverage does not include the following:

• Drugs used to treat anorexia, weight loss, or weight gain

  • Note: Part D may cover drugs used to treat physical wasting caused by AIDS, cancer, or other diseases

• Fertility drugs

• Drugs used for cosmetic purposes or hair growth

  • Note: Drugs used for the treatment of psoriasis, acne, rosacea, or vitiligo are not considered cosmetic drugs and may be covered under Part D

• Drugs that are only for the relief of cold or cough symptoms

• Drugs used to treat erectile dysfunction

• Prescription vitamins and minerals (except prenatal vitamins and fluoride preparations)

• Non-prescription drugs (over-the-counter drugs)

How to Access Medicare Part D Coverage:

In order to avoid additional medical expenses, it is a good idea to work with your doctor and pharmacy to ensure that what they are prescribing you is covered under your private prescription drug coverage. The following are some ways to ensure this coverage:

• Before you go to the pharmacy, find out if your drug is on your plan’s formulary. If possible, ask your doctor to check that your prescription is covered. Otherwise, call your plan directly or check your plan’s website.

• Find out whether your plan places any restrictions on coverage, such as:

  • Prior authorization: you must get prior approval from the plan before it will cover a specific drug

  • Step therapy: your plan requires you try a different or less expensive drug first

  • Quantity limits: your plan only covers a certain amount of a drug over a certain period of time, such as 30 pills per month

• Use a preferred, in-network pharmacy to fill your prescriptions. Many pharmacy networks include both preferred and non-preferred pharmacies. You typically pay less for your prescriptions at preferred pharmacies.

These steps will help you avoid gaps in coverage and unexpected fees and costs from prescriptions that are not covered by Medicare Part D.

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