Medicare Announces Price Reductions for 15 Medications Set for 2027

Maximum fair prices for a second group of 15 medications negotiated by Medicare will officially take effect on January 1, 2027, according to announcements by the Centers for Medicare & Medicaid Services (CMS). The upcoming price reductions range from 38% to 85% compared to 2024 list prices. This rollout follows the implementation of the historic drug price negotiation program established by the 2022 Inflation Reduction Act, which lifted a long-standing federal prohibition preventing Medicare from directly negotiating drug costs with manufacturers.

The newly negotiated list spans a wide variety of medical conditions. Beyond popular diabetes and weight-management medications containing semaglutide—such as Ozempic, Wegovy, and Rybelsus—the list includes treatments for asthma, chronic obstructive pulmonary disease (COPD), psoriasis, schizophrenia, pulmonary fibrosis, and a brain disorder related to the liver. It also incorporates four cancer medications, two older diabetes pills, and treatments for constipation and involuntary movement conditions.

Data compiled from CMS figures indicates that approximately 5.3 million out of the 53 million enrollees in Medicare Part D used at least one of these 15 medications in 2024. Had the newly negotiated prices been in effect during that year, the CMS estimates that Medicare would have spent roughly $12 billion less after accounting for rebates, marking a 44% overall savings. Factoring in an older manufacturer rebate program, the savings are projected at approximately $8.5 billion, or 36%. Furthermore, the agency anticipates that patients will save around $685 million in out-of-pocket costs throughout 2027 under the standard Part D benefit.

Among the high-profile drugs on the 2027 list is semaglutide, marketed as Ozempic, Wegovy, and Rybelsus by Danish pharmaceutical company Novo Nordisk. The negotiated Medicare price will drop to $274 for a 30-day supply, representing a 71% decrease from its 2024 list price of $959. In 2024, approximately 2.3 million Part D enrollees utilized one of these three brand formulations, resulting in roughly $15.2 billion in spending before rebates.

Federal regulations dictate that the lower Medicare pricing does not automatically expand coverage parameters. Part D plans are strictly prohibited by federal law from paying for medications used exclusively for weight loss, though plans may cover Ozempic and Rybelsus for type 2 diabetes management. Similarly, Wegovy may be covered to reduce cardiovascular risks for adults with heart disease who suffer from obesity or overweight conditions, an indication approved by the FDA in 2024.

To help patients navigate coverage, separate temporary pathways have been introduced, such as the Medicare GLP-1 Bridge program, which runs from July 2026 through December 2027 to cover specific weight-loss prescriptions under set copay rules. Meanwhile, pharmaceutical manufacturers like Novo Nordisk have also announced plans to independently reduce the US list price for their semaglutide products to $675 per month starting around the same period as the federally negotiated rates.

Importantly, a lower Medicare-negotiated price does not guarantee an identical reduction at the pharmacy counter for every patient. Enrollees who are still working through their deductibles or paying co-insurance stand to benefit the most, while individuals with fixed copayments may experience little to no change. Beneficiaries have until the close of the open enrollment period on December 7, 2026, to evaluate how their respective 2027 health plans will manage formularies and cover each specific medication.