Total savings for seniors may hit $15 billion
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Out-of-pocket costs for the first 10 Medicare-negotiated prescription drugs will fall by more than 50% on average starting Jan. 1, 2026
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Nearly 9 million Medicare seniors use the drugs, which treat conditions such as diabetes, heart disease, cancer and autoimmune disorders
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Total savings for Medicare Part D enrollees are expected to reach $1.5 billion in 2026, according to federal estimates
Out-of-pocket costs for some of the most commonly used prescription drugs among Medicare seniors are set to fall dramatically in 2026, according to a new report released Tuesday by AARP.
The analysis finds that people enrolled in stand-alone Medicare Part D plans will see their out-of-pocket costs for the first 10 Medicare-negotiated drugs drop by an average of more than 50% when negotiated prices take effect on Jan. 1, 2026. The medications are used by nearly 9 million Medicare beneficiaries and are prescribed to treat serious and chronic conditions, including diabetes, heart disease, autoimmune disorders and cancer.
The price reductions stem from Medicares new drug price negotiation authority, created under the 2022 prescription drug law that AARP strongly supported. The program allows Medicare to negotiate prices directly with drug manufacturers for select high-cost medications, a shift that advocates say is long overdue.
Major savings for seniors
AARP officials say the savings will make a meaningful difference for older Americans who have struggled with rising drug prices and difficult choices between medication and other basic needs.
Medicare prescription drug negotiation is on track to deliver billions in savings for Americas seniors starting in January, making lifesaving medication more affordable, said Nancy LeaMond, AARPs executive vice president and chief advocacy and engagement officer. But beware: big drug companies are spending millions to delay negotiation and keep prices sky highwhile lining their own pockets.
LeaMond said AARP will continue to oppose efforts to weaken or delay the negotiation program, emphasizing the organizations role as an advocate for older Americans and their families.
According to the Centers for Medicare & Medicaid Services, the negotiated prices are expected to save Medicare Part D enrollees about $1.5 billion in out-of-pocket costs in 2026 alone.
Improved access and coverage
The AARP report analyzed stand-alone Part D plan data from five states with high Medicare enrollment and found that lower negotiated prices are translating into measurable, real-world savings.
Among the key findings:
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Seven of the 10 negotiated drugs are expected to cost enrollees less than $100 per month in 2026
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All stand-alone Part D plans reviewed in the study will cover all 10 drugs next year, an increase compared with current coverage levels
Leigh Purvis, AARPs prescription drug policy principal and the reports author, said the changes could improve access for seniors who previously struggled to afford these medications.
Our report shows that Medicare beneficiaries should see substantially lower monthly costs for these medicines in 2026, Purvis said. This will improve access for seniors who were previously facing high out-of-pocket costs and confirms that Medicare drug price negotiation is providing real benefits for people in the Medicare program.
Industry opposition continues
While consumer advocates have praised the negotiation program, pharmaceutical companies have mounted legal challenges and lobbying efforts aimed at delaying or blocking its implementation. Drugmakers argue the policy could harm innovation, a claim AARP and other advocates dispute.
Supporters counter that high drug prices have already limited access for many patients and that negotiated pricing helps ensure Medicare beneficiaries can obtain needed treatments without financial hardship.
What comes next
The negotiated prices for the first 10 drugs are scheduled to take effect at the start of 2026, with additional medications expected to be added to the program in future years.
The full AARP report is available online, along with additional information about the organizations efforts to lower prescription drug prices and expand affordability for older Americans.
Posted: 2025-12-22 01:57:07
