Medicare Drug Prices in 2027: Will Your Copay Drop?

By Austin Tyler · Tyler Insurance Group · Updated August 2026

 

You are going to see a lot of headlines this fall saying Medicare drug prices are dropping. They are not wrong. They are just answering a different question than the one you are asking.

 

The question you are asking is what you will pay at the pharmacy counter in January. That is not the same as the list price, and for a lot of people the answer will be "about the same as now."

 

Quick answer. On January 1, 2027, negotiated prices take effect for a second group of 15 Part D drugs, averaging roughly 44 percent off list price. But the negotiated price is what Medicare pays. What you pay is set by your plan's formulary tier, your deductible, and which phase of the benefit you are in. Some people will see a real drop. Others will see no change at all.

 

What actually got negotiated

Under the Inflation Reduction Act, Medicare negotiates prices directly with manufacturers for a growing list of high-spend drugs. The first 10 took effect in 2026. A second group of 15 follows on January 1, 2027, covering drugs used by about 5.3 million Part D enrollees.

 

Publicly confirmed drugs in this second group include the semaglutide medicines (Ozempic, Rybelsus and Wegovy), Trelegy Ellipta for COPD and asthma, Linzess, Ibrance and Xtandi for cancer, Austedo, Trulicity and Xifaxan. They treat diabetes, cardiovascular disease, obesity, respiratory disease, cancer and digestive conditions.

 

One caution about lists you will see online. Coverage of this program has been mixing up the negotiation rounds. The round taking effect in January 2027 is the second one. A third round was selected in January 2026 and does not take effect in 2027. If you see a drug list, check which year the prices actually apply to before you plan around it.

 

The four things that decide what you actually pay

 

1. Which tier your plan puts the drug on

This is the big one. Plans sort covered drugs into tiers, and your cost sharing follows the tier, not the list price. A drug can get a large negotiated discount and stay on a specialty tier where you owe a percentage of the cost. Tier placement is set by your plan and can change every January.

 

2. Whether you have met your deductible

The standard Part D deductible rises to $700 in 2027. Until you meet it, you generally pay the full negotiated price rather than a copay. A lower negotiated price genuinely helps here, because you are paying that price directly.

 

3. Which phase of the benefit you are in

Part D moves through phases across the year: the deductible, then initial coverage where you pay a copay or coinsurance, then the catastrophic phase once you hit the out-of-pocket cap, which is $2,400 in 2027. Where you sit in that sequence when you fill a prescription changes what you hand over.

 

4. Whether your plan covers the drug at all

A negotiated price applies to drugs a plan covers. Formularies change annually, and a plan can move, restrict or drop a drug for 2027 regardless of what was negotiated. Prior authorization and step therapy requirements can change too.

 

Who is most likely to see a real drop

• People who spend part of the year in the deductible phase, where you pay the drug's price directly.
• People taking one of the negotiated drugs who do not reach the out-of-pocket cap, so their coinsurance is calculated on a lower price.
• People whose plan uses coinsurance, a percentage of cost, rather than a flat copay for that tier.

Conversely, if you pay a flat $47 copay on a preferred brand tier, that copay is $47 whether the underlying price fell 44 percent or not. And if you already reach the out-of-pocket cap every year, you were going to stop paying at the cap either way.

 

How to check your own answer during open enrollment

1. Get your plan's 2027 formulary, which arrives with your Annual Notice of Change by September 30 or is posted on the plan's website.
2. Look up each drug you take by name and note its tier for 2027, not 2026.
3. Check whether the tier uses a flat copay or a percentage. Percentages move with price; flat copays do not.
4. Check for new prior authorization or step therapy requirements on your drugs.
5. Compare against at least one other plan available where you live, using the Medicare Plan Finder at Medicare.gov or a licensed agent who can run all of them at once.

This is the comparison our licensed agents run every fall. For a closer look at how coverage rules play out for one much-asked-about drug class, our local Kentucky team wrote up how Medicare handles Ozempic, Wegovy and Zepbound (https://www.bluegrassmedicarehelp.com/articles/does-medicare-cover-ozempic-wegovy-zepbound/) .

 

Quick recap

• Negotiated prices for a second group of 15 Part D drugs take effect January 1, 2027, at roughly 44 percent off list price.
• The negotiated price is what Medicare pays. Your copay is set by your plan's tier, your deductible and your benefit phase.
• Flat copays do not move with list price. Coinsurance percentages do.
• Formularies change every January, so check the 2027 list rather than assuming last year's tiers.
• Published drug lists are mixing up the negotiation rounds; confirm which year a price actually applies to.

Frequently asked questions

 

Will Ozempic be cheaper on Medicare in 2027?

The semaglutide medicines, sold as Ozempic, Rybelsus and Wegovy, are in the second group of drugs with negotiated Medicare prices effective January 1, 2027, at an average reduction across the group of about 44 percent off list price. Whether your own cost falls depends on your plan's formulary tier for 2027, whether you have met your deductible, and which phase of the Part D benefit you are in. Coverage also depends on what the drug is prescribed for. Check your specific plan's 2027 formulary.

 

Does a negotiated Medicare drug price lower my copay?

Not automatically. The negotiated price sets what Medicare pays the manufacturer. Your out-of-pocket cost is determined by your plan's cost-sharing design: which tier the drug sits on, whether that tier charges a flat copay or a percentage of cost, whether you have met your deductible, and whether you have reached the annual out-of-pocket cap. If you pay a flat copay, a lower list price may not change your cost at all.

 

Which drugs have negotiated Medicare prices in 2027?

A second group of 15 Part D drugs, used by roughly 5.3 million enrollees. Publicly confirmed among them are the semaglutide medicines (Ozempic, Rybelsus, Wegovy), Trelegy Ellipta, Linzess, Ibrance, Xtandi, Austedo, Trulicity and Xifaxan. They treat conditions including diabetes, cardiovascular disease, obesity, COPD and asthma, cancer and digestive disorders. Verify any list against CMS, because published coverage has been confusing this round with the later round selected in 2026.

 

What is the Part D out-of-pocket cap in 2027?

$2,400, up from $2,100 in 2026. Once your out-of-pocket spending on covered Part D drugs reaches that amount in a calendar year, you pay nothing further for covered drugs that year. The standard Part D deductible for 2027 is $700, up from $615.

 

How do I find out what my drugs will cost next year?

Your plan sends an Annual Notice of Change by September 30 with the coming year's formulary and cost sharing. Look up each drug by name, note the 2027 tier, and check whether that tier uses a flat copay or a percentage. Then compare against other plans available where you live using the Medicare Plan Finder at Medicare.gov during the Annual Enrollment Period, October 15 to December 7, or ask a licensed agent to run the comparison across every plan at once.

 

Talk it through with a licensed agent

Our licensed agents compare every plan available where you live, check your doctors and your prescriptions by name, and tell you plainly when the plan you already have is the right one. There is no cost to work with us.