Alaska Part D premiums could rise in 2027 as CMS ends stabilization program

Alaska Medicare beneficiaries could pay more for prescription drug coverage next year. The Centers for Medicare & Medicaid Services will end the Part D Premium Stabilization Demonstration after 2026. Low-income enrollees who receive Extra Help are partially insulated.

The temporary program was created to hold down Medicare Part D premiums by giving participating plans additional federal financial support. The agency said, "CMS will discontinue the demonstration at the end of CY 2026 to return the program to operating under traditional market conditions in CY 2027."

Medicare's annual out-of-pocket cap for covered prescription drugs stays in place. But the end of the demonstration may bring higher monthly Part D premiums and changes in plan offerings for the 2027 plan year. Beneficiaries without Extra Help, the federal subsidy for low-income enrollees, pay their plan's full premium. Extra Help covers premiums up to a benchmark level, so recipients still depend on being enrolled in a benchmark plan to keep their costs at or near zero.

The change comes as Part D is being redesigned under the federal Inflation Reduction Act. That law created the hard annual out-of-pocket cap on drug spending and expanded Extra Help eligibility.

CMS will announce final 2027 premiums and plan offerings in September. State counselors say Alaskans should review their coverage each year during open enrollment, Oct. 15 through Dec. 7, because plans may adjust premiums or benefits. Alaska's Medicare Information Office offers free, unbiased counseling at 907-269-3680 in Anchorage or 1-800-478-6065 toll-free within Alaska.