Millions of older adults with Medicare prescription coverage will see lower prices on some of the most commonly used – and most expensive – brand-name drugs starting in 2026, with even bigger savings in 2027. AARP, which pushed for these changes, says the new negotiations will bring “meaningful relief” to people who have been stretching budgets or skipping needed medicines because of high costs.
Lower Prices Start in 2026
A 2022 law gave Medicare the authority to sit down with drug manufacturers and negotiate prices for high-cost Part D drugs that lack cheaper generic or biosimilar options. The first round covers 10 widely used medications, with reduced prices taking effect January 1, 2026, and is expected to save Part D enrollees about 1.5 billion dollars in out-of-pocket costs that year.
These initial drugs treat serious conditions common in older adults, including: blood clots (Eliquis, Xarelto), heart failure (Entresto), rheumatoid arthritis and psoriasis (Enbrel, Stelara), diabetes and related heart and kidney problems (Farxiga, Jardiance, Januvia, Fiasp and NovoLog insulin), and blood cancers (Imbruvica). AARP notes that the negotiated prices are at least 38 percent below 2023 list prices and often 50 percent or more, which can make the difference between filling a prescription and going without.
Bigger List – and Savings – in 2027
In 2027, 15 additional high-cost Part D drugs will join the negotiated list, used by about 5.3 million people and responsible for roughly 40.7 billion dollars in Medicare spending. CMS estimates these second‑round prices will save Medicare 8.5 to 12 billion dollars a year and cut beneficiaries’ out‑of‑pocket spending by about 685 million dollars annually.
These medicines include Ozempic, Rybelsus, Wegovy, Tradjenta, Janumet and Janumet XR for type 2 diabetes and related conditions; Trelegy Ellipta and Breo Ellipta for asthma and COPD; cancer drugs such as Xtandi, Ibrance, Pomalyst, Calquence and Ofev; Linzess and Xifaxan for chronic constipation and IBS; Austedo and Austedo XR for movement disorders; Vraylar for mood and psychiatric conditions; and Otezla for psoriasis and psoriatic arthritis. Starting January 1, 2027, every stand‑alone Part D plan and every Medicare Advantage prescription plan must offer these negotiated prices to eligible enrollees.
How This Fits Into A Bigger Push
AARP stresses that drug price negotiation is just one piece of broader Medicare prescription reforms that also include a new 2,000‑dollar annual cap on Part D out‑of‑pocket costs in 2025 and the continued 35‑dollar monthly cap on insulin. The group warns that drug companies are lobbying and filing lawsuits to weaken or overturn Medicare’s negotiating authority and says it will keep mobilizing its 50‑plus membership to defend and expand these savings.
For seniors, AARP’s key message is to stay informed: review Part D and Medicare Advantage plan materials carefully for 2026 and 2027, talk with prescribers about whether your medications are on the negotiated lists, and factor these changes into your coverage choices during open enrollment.