Planned Expiry of Medicare Drug Subsidy Draws Ire of Democrats and Advocates for Seniors

More than 23 million Medicare recipients could be facing higher drug prices next year when the Trump administration allows the sunset of an optional expansion plan that cut prices on prescriptions.Enhanced subsidies for Medicare drug coverage, known as Medicare Part D, were launched during the Biden administration in 2023 as part of the Inflation Reduction Act. They included expanded eligibility for lower-income recipients and tighter caps on out-of-pocket drug spending.The Trump administration characterized the subsidies, which reimbursed health insurance companies that agreed to hold down premium increases, as corporate welfare for companies.“The Biden admin gave BILLIONS of taxpayer money DIRECTLY to Big Insurance Companies. This is unacceptable,” the administrator for the Centers for Medicare & Medicaid Services, Dr. Mehmet Oz, said this week. “We are stabilizing the market so this bailout is no longer needed. Premiums will go up by less than $10 for most Medicare recipients, with many even seeing LOWER premiums.”But the announced changes drew fierce backlash from Democrats and criticism from advocates.“Republicans passed the largest cut to Medicare in history,” the Democratic National Committee chairman, Ken Martin, said Thursday on social media. “Now, Donald Trump is raising prescription drug costs for millions of seniors on Medicare. Democrats will work to expand healthcare access and lower costs.”The Medicare Rights Center also weighed in with a statement. “At a time when people with Medicare are already struggling with rising costs, we at Medicare Rights are concerned this decision will unnecessarily erode beneficiary choice, health, and financial security,” it said.“It is likely to make it harder for older adults and people with disabilities to access and afford needed care and may increase enrollment in MA-PD plans that carry increased exposure to administrative barriers like prior authorization.” MA-PD refers to Medicare Advantage prescription drug plans.“For someone living on a fixed income, that can mean choosing between medicine, groceries, or the electric bill,” the health care advocacy group Protect Our Care said in a social media post. “Trump and Republicans keep raising costs for seniors while handing tax breaks to billionaires and big corporations. Seniors deserve better.”About 23 million Americans are on standalone Medicare Part D plans, which pay for outpatient prescription drugs. According to the AARP, the average senior on Medicare Part D takes four to five medications per day. Premiums for those on Medicare Part D totaled $141 billion in 2025, representing 11 percent of Medicare spending, according to the bipartisan health policy organization KFF.“Without these extra subsidies in place for 2027, some Part D stand-alone drug plan enrollees could face a larger premium increase for drug coverage next year than in recent years, though plan-specific premium amounts are not yet known,” wrote the vice president and director of the Program on Medicare Policy at KFF, Juliette Cubanski.The subsidies totaled $10 billion in 2025 and 2026, and worked to reduce the average prescription drug plan premium by $26 in 2025 and $16 in 2026 even as more than 2 million people enrolled in Part D.Mr. Oz said that every Medicare beneficiary “still has access to low-cost plans, and we will continue to lower prescription drug prices for every American patient, from more (most favored nation) deals to our policy giving seniors access to GLP-1s for $50 a month.”According to KFF, the Biden-era subsidies aimed to stabilize drug premiums during the rollout of larger changes to Part D. Now, CMS has decided the extra financial support is no longer necessary to keep the market stable.But rising drug prices and the explosion in use of GLP-1s and specialty drugs have put additional pressure on prescription costs, KFF says. The average monthly premium for Part D recipients of $36 remains more than four times higher than the $8 paid by those on Medicare Advantage.“These cost pressures are likely to continue in 2027 and beyond,” Ms. Cubanski wrote.Brand name prescription drug prices have been increasing more quickly than the rate of inflation for decades, the AARP says.A January 2025 AARP study found that the top 25 most-used brand-name drugs that had not yet been selected for price negotiation went up in price by 98 percent since they first entered the market. Those drugs included Trulicity, Ozempic, Linzess and Ingrezza. The prescriptions were used by 7 million people and drove $50 billion in Medicare spending in 2022, the AARP said.In February, the Trump administration launched the initiative and website TrumpRx, providing those who are uninsured or willing to pay cash with a list of discounted drugs that can be purchased directly from manufacturers. The president has touted negotiated agreements with 17 drug companies designed to bring down costs.During the public portion of a Cabinet meeting at Camp David Friday, the Health and Human Services secretary, Robert F. Kennedy Jr., said the Trump Rx program has so far saved patients $700 million.

Planned Expiry of Medicare Drug Subsidy Draws Ire of Democrats and Advocates for Seniors

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