Overview
- The Centers for Medicare and Medicaid Services announced it will not renew the temporary Part D subsidy that paid insurers extra help for 2025–26 and will end the program after the 2026 plan year.
- The decision removes a unilateral CMS stabilization payment that operated alongside a statutory Inflation Reduction Act mechanism and does not eliminate the Part D benefit itself.
- Supporters cite increased federal costs tied to the subsidies, with reporting that the measures raised federal outlays by roughly $40 billion in 2025–26 and produced a large rise in long‑term Part D liabilities in the trustees report.
- CMS projects most enrollees will see no change or only small premium increases, and the agency said many beneficiaries would face under $10 more per month, but analysts warn premiums could rise because the subsidies had cut average monthly standalone Part D premiums from $43 in 2024 to $36 in 2025.
- Concrete effects for seniors will become clear when CMS releases 2027 plan bids in September and beneficiaries choose plans during open enrollment from October 15 to December 7, a process that could shift some people into different plans or raise out‑of‑pocket costs.