2027 Medicare price negotiations are in, and so are GLP-1s

As it goes with the Inflation Reduction Act, CMS announced negotiated prices for 15 high-cost drugs that take effect January 1, 2027. This time around, the savings are substantial. An estimated $12 billion would have stayed in beneficiaries’ pockets if these prices had been in effect in 2024. Droves of beneficiaries stand to save an estimated $685 million in out-of-pocket costs when these prices become effective.

The headliner: GLP-1s join the club

The inclusion of Ozempic, Rybelsus, and Wegovy marks a turning point in Medicare drug coverage. The negotiated 30-day supply price drops from $959 to $274—a 71% discount.

2.3 million Medicare Part D enrollees used these medications in 2024, with over $15 billion in total covered costs. These drugs treat Type 2 diabetes, cardiovascular disease, and obesity. Since obesity is the most common chronic condition for those working over 60, a lower price tag can help those needing the boost lose 15%-20% of their body weight now that the price is more affordable.

Cost has been the primary barrier to access across the board, but particularly so for those over 65. At an average of $1,300 monthly without insurance, many Medicare beneficiaries either struggled to afford these medications or went without them entirely.

But we’re getting ahead of ourselves. Here’s the whole list:

Over 1.9 million Medicare beneficiaries used the respiratory medications in 2024. Another 632,000 used Linzess for digestive issues. Understanding which medications resonate with specific populations helps agents provide relevant information during client conversations.

What does this mean for you?

The key is understanding how this translates to savings for you.

Medicare plans are required by law to include these negotiated drugs in their formularies, so if you were choosing a plan solely based on the coverage of one of these drugs, you're options now have opened up substantially. The negotiated price applies regardless of which coverage phase you're in. With the elimination of the coverage gap, the $2,100 out-of-pocket maximum in 2026, and the Part D Prescription Drug Payment Plan, you should have an easier time than ever predicting costs and budgeting effectively.

FAQs

"My current plan already covers this medication. Does this change anything?"

Current out-of-pocket costs will update to the new negotiated prices. Even with current coverage, you may be paying significantly more than the new negotiated prices, especially if you haven't met your deductible or are in the initial coverage phase.

"Will my plan drop this medication from the formulary?"

Plans are required to include all 15 negotiated medications, and any of those previously negotiated. This is mandated, so you're drugs are safe on your formulary until a biosimilar or generic is released. 

The bottom line

The 2027 Medicare drug negotiations are a boon for those who are on one of these drugs. GLP-1s capture attention due to their popularity and dramatic price reduction, but the other 14 medications affect hundreds of thousands of beneficiaries across diverse health conditions.

If you are on one of these drugs, it might be a good idea to meet with an agent here at Action Benefits to review all of your options. These new prices might mean a plan switch is in your best interests.