The drug-coverage part of a Medicare Advantage premium is set to fall 38% in 2027. The Centers for Medicare & Medicaid Services said on Sept. 28 that Medicare Advantage plans that include drug coverage will charge an average of $7 a month for the Part D portion of the premium, after Medicare Advantage rebates, down from $11.32 in 2026. The decrease is $4.32 a month, or about $52 across a year for a member paying exactly the average.
What the $7 counts and what it leaves out
The figure appears in the CMS announcement on the 2027 plans as the average monthly Part D premium for Medicare Advantage plans with drug coverage. The release attaches one qualifier that changes the reading: the $7 is measured after Medicare Advantage rebates. It is a premium, the monthly charge for having the coverage, and not a measure of what members spend when they fill prescriptions.
The 38% is arithmetic on two averages. A drop from $11.32 to $7 is $4.32, and $4.32 divided by $11.32 is about 38%. Neither figure describes a specific plan, and the release does not say how many members pay less or more than the average. A member in a plan whose drug portion is $0 and a member in a plan charging several times $7 are both inside the same national number.
Why $7 and $36 are not competing prices
The same release puts the average stand-alone drug plan premium at $36 in 2027, up from $35.09. Placed side by side, $7 and $36 look like a contest between two ways to buy drug coverage. The numbers rest on different bases. The $7 covers only the drug portion of an Advantage premium and is calculated after rebates, while the $36 is the full premium of a stand-alone plan bought separately by a person in Original Medicare.
The end of the Part D Premium Stabilization Demonstration also lands on the stand-alone side of the market. CMS’s July 28 fact sheet describes the demonstration as a voluntary program for stand-alone drug plans, and KFF’s Juliette Cubanski wrote in a July 29 analysis that it paid subsidies to stand-alone plan sponsors. The Advantage drug-portion average fell over the same period that the stand-alone program was winding down.
The drug portion fell faster than the whole premium
The same release reports that the weighted average Medicare Advantage premium falls 16.5%, from $14.37 to $12.00, a drop of $2.37 a month. The drug portion fell 38%, a larger percentage, and its $4.32 monthly drop is larger in dollars than the $2.37 for the premium as a whole.
The two cannot be added or subtracted from each other. The $7 is an average across plans with drug coverage, while the $12.00 is an average across Medicare Advantage plans generally, and CMS reports them as separate figures. The 38% also rests on the 2026 base of $11.32, which was itself an average across plans, so the percentage says how the averages moved and not how any one plan’s price changed. A member in a plan without drug coverage has no Part D portion to lower, and the release’s drug figure says nothing about that member’s premium.
The ceiling on drug spending sits outside the premium
A lower drug premium does not change how much a member pays at the pharmacy. Medicare.gov’s page on Part D costs says out-of-pocket spending on covered drugs reaches a cap of $2,100 in 2026 and $2,400 in 2027. After that, catastrophic coverage means no cost-sharing for covered Part D drugs for the rest of the calendar year. The cap rises by $300 between the two years even as the average Advantage drug premium falls by $4.32 a month.
Members with limited income sit on a separate track. Medicare.gov’s help-with-drug-costs page says qualifying Extra Help enrollees pay $0 for plan premiums and deductibles in 2027, with copayments capped at $5.80 for generic drugs and $14.40 for brand-name drugs. For those members, an average drug premium is not the number that governs the bill. The Social Security Administration’s Extra Help page says applications can be made online, by phone at 1-800-772-1213 or by TTY, before or after enrolling in Part D.
Changing drug coverage inside a Medicare Advantage plan
Open Enrollment runs from Oct. 15 to Dec. 7, and Medicare.gov says members can join, drop or switch to another Medicare Advantage plan with or without drug coverage. Changes take effect Jan. 1, and the plan must receive the request by Dec. 7. CMS counted about 5,532 Medicare Advantage plans for 2027, and 97% of beneficiaries can reach 10 or more of them, so the plan pool is wide. CMS’s release lists the Medicare Plan Finder and the 1-800-MEDICARE helpline, open 24 hours a day, as the places to compare.
CMS’s national figure for 2027 is $7 a month for the drug portion of an Advantage premium, after rebates, against $11.32 in 2026.
Weighing the drug portion of an Advantage plan against the medicines on a member’s list
The drug portion of a Medicare Advantage premium is one input to what a plan costs a member who takes regular prescriptions. The same premium can sit beside very different pricing for the specific medicines on a member’s list.
The 2027 Medicare Open Enrollment Decision Kit includes a prescription-by-plan comparison and a cost calculator spreadsheet that compares plans on cost, drugs and doctors.
Compare each prescription across plans with The 2027 Medicare Open Enrollment Decision Kit.
This article was produced with AI assistance and checked against the primary sources linked above.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
