Federal Part D Premium Support Is Ending in 2027: What Could It Mean for Hawaiʻi Medicare Beneficiaries?

Medicare prescription drug coverage has gone through several major changes in recent years. Some of those changes have helped protect beneficiaries from extremely high medication costs, including the new annual out-of-pocket limit for Medicare Part D.

However, another change is now coming for 2027—and it may affect what some people pay for their prescription drug coverage.

The Centers for Medicare & Medicaid Services, commonly known as CMS, recently announced that it will end a temporary federal program that has helped stabilize premiums for stand-alone Medicare Part D prescription drug plans.

That announcement has created understandable concern about whether Part D premiums could increase in 2027.

At this point, the most honest answer is:

Some premiums may rise, but the exact effect on Hawaiʻi beneficiaries will not be known until the final 2027 plans, premiums, formularies, and benefits are released.

Here is what we currently know.

What Federal Part D Support Is Ending?

The program being discontinued is called the Part D Premium Stabilization Demonstration.

CMS introduced this temporary program in 2025 as Medicare implemented a major redesign of the Part D prescription drug benefit. Among other changes, the redesign placed a stronger limit on beneficiaries’ annual out-of-pocket prescription costs, while shifting more financial responsibility to insurance companies and drug manufacturers.

Federal officials were concerned that insurers might respond to those higher responsibilities by sharply increasing premiums or withdrawing stand-alone Part D plans from the market.

To reduce that risk, CMS temporarily provided additional federal support to participating stand-alone Part D plans.

In 2025, the program reduced beneficiary premiums by as much as $15 per month, limited year-over-year premium increases and gave participating insurers additional protection from unexpectedly high drug costs. The assistance was reduced for 2026. CMS has now announced that the demonstration will end after December 31, 2026.

CMS says insurers now have enough experience with the redesigned Part D benefit to develop their 2027 pricing without this temporary assistance.

Is Extra Help Ending Too?

No.

This is an important distinction.

The temporary Premium Stabilization Demonstration is not the same as Medicare’s Extra Help, also known as the Part D Low-Income Subsidy.

Extra Help assists qualifying beneficiaries with Part D premiums, deductibles and prescription drug cost-sharing. That program is not being eliminated by this announcement.

Some people may hear the word “subsidy” and assume their Extra Help is ending. That is not what CMS announced.

Beneficiaries who currently receive Extra Help should still review their 2027 coverage carefully, because benchmark plans, premiums and formularies can change. However, the underlying Extra Help program remains available to people who meet its eligibility requirements.

Why Was the Temporary Program Created?

The federal government was trying to accomplish two things:

1. Improve protection for beneficiaries with high prescription drug expenses.

2. Prevent sudden premium increases while insurers adjusted to the redesigned benefit.

According to the U.S. Government Accountability Office, the premium stabilization program largely achieved its short-term purpose. It helped hold down average stand-alone Part D premiums and supported stable enrollment during the transition.

However, the program was also expensive. CMS estimated that it would cost the federal government approximately $9.8 billion during 2025 and 2026.

Supporters of ending the program argue that it was always intended to be temporary, that insurance companies have now had time to adjust and that taxpayers should not continue providing billions of dollars in additional support indefinitely.

Consumer advocates see another side of the issue. They are concerned that removing the assistance may cause some plans to increase premiums more sharply than beneficiaries have experienced in recent years. KFF has cautioned that some people enrolled in stand-alone Part D plans could face larger increases in 2027, although plan-specific premiums are not yet known.

Both viewpoints are worth understanding.

Does This Mean Everyone’s Part D Premium Will Increase?

Not necessarily.

Every Part D insurance company develops its own premiums and benefits. Some plans may raise premiums significantly, some may make smaller changes and others could potentially remain stable or even decrease.

The end of the federal demonstration removes one form of premium support, but it does not determine exactly what every plan will charge.

Insurance companies may respond in different ways, including changes to:

• Monthly premiums

• Deductibles

• Copayments or coinsurance

• Covered-drug formularies

• Preferred pharmacy networks

• Prior-authorization or step-therapy requirements

• The number of plans they offer

That is why the monthly premium will tell only part of the story.

A plan with a low premium may not be the best value if it does not cover an important medication favorably. A plan with a higher premium may sometimes produce lower overall costs, depending on a person’s prescriptions and pharmacy.

Who in Hawaiʻi Could Be Most Directly Affected?

The temporary program applies to stand-alone Part D prescription drug plans.

These plans are commonly used by people who have:

• Original Medicare

• Original Medicare with a Medicare Supplement plan

• Certain other types of Medicare coverage that do not include prescription benefits

The program does not apply in the same way to Medicare Advantage plans that already include prescription drug coverage.

Hawaiʻi had eight stand-alone Medicare prescription drug plans available for 2026, according to CMS. With a relatively limited number of choices, a significant premium increase, formulary change or plan withdrawal could be especially important for local beneficiaries.

Medicare Advantage members should not assume that their coverage will remain unchanged, however. Medicare Advantage plans can also revise their drug formularies, pharmacy networks, copayments and benefits each year.

The practical lesson is the same for everyone:

Do not assume your 2026 coverage will work exactly the same way in 2027.

Could This Make Medicare Advantage More Attractive?

Possibly, especially if premiums for stand-alone Part D plans rise.

Many Hawaiʻi Medicare Advantage plans include prescription drug coverage as part of the plan. Some beneficiaries may compare that bundled coverage with the combined cost of Original Medicare, a Medicare Supplement policy and a separate Part D plan.

However, switching coverage solely because of a Part D premium would be a mistake.

Medicare Supplement and Medicare Advantage work very differently. Before making a change, beneficiaries should consider:

• Doctors and hospitals

• Provider networks

• Prescription coverage

• Travel needs

• Monthly premiums

• Copayments and coinsurance

• Maximum out-of-pocket exposure

• The ability to qualify for a Medicare Supplement policy later

A lower monthly premium does not automatically mean better coverage, just as a higher premium does not automatically mean a better plan.

What Should Hawaiʻi Beneficiaries Do Now?

There is no need to panic or make an immediate coverage change.

The full 2027 Hawaiʻi plan information is not yet available. Until the final premiums and benefits are released, nobody can accurately say exactly how much a particular beneficiary will pay next year.

For now, the best steps are simple:

Keep a current list of your prescriptions, including dosage and frequency. Watch for your plan’s Annual Notice of Change, which explains how its costs and coverage will differ in 2027. When plan information becomes available, compare total estimated annual costs rather than looking only at the monthly premium.

Also confirm that your medications remain on the formulary and that your preferred pharmacy is still treated favorably by the plan.

This may be an especially important year for beneficiaries who have renewed the same Part D plan automatically for several years.

We Will Share More as Soon as the Picture Becomes Clear

The announcement that federal premium support is ending is important, but it is only the beginning of the 2027 Part D story.

We still need to see:

• Which stand-alone plans will be offered in Hawaiʻi

• What each plan will charge

• Whether formularies and pharmacy networks change

• How Extra Help benchmark coverage will be affected

• Whether any insurers enter or leave the local market

Premier Benefit Consultants will continue reviewing the information as it becomes available. Once the final Hawaiʻi plan details are clear, we will share an updated explanation of what the changes may mean for local beneficiaries.

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Need Help Understanding Your Medicare Coverage?

Prescription drug coverage can be confusing, especially when premiums, formularies and pharmacy networks change from one year to the next.

At Premier Benefit Consultants, our licensed, local Medicare insurance agents help Hawaiʻi residents understand their Medicare options and compare coverage based on their prescriptions, doctors, healthcare needs and budget. Our guidance is available at no cost to you.

You do not need to wait until the Annual Enrollment Period to begin asking questions. If you are concerned about the upcoming Part D changes or want help understanding your current coverage, contact PBC to speak with a local Medicare insurance professional.

We may not have every 2027 answer yet—but we can help you understand what is known, what remains uncertain and what to review once the final plan information is released.

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Disclaimer: This article is for educational purposes only and is based on information available as of August 2026. Final 2027 Medicare Part D plans, premiums, formularies, pharmacy networks and benefits were not yet available when this article was written. Medicare rules and plan details may change. For current information, consult Medicare.gov, your plan documents or a licensed Medicare insurance professional.