Millions of New Yorkers benefiting from Medicare Part D subsidies could start seeing higher monthly premiums if the Trump administration ends the program, according to Gov. Kathy Hochul.
The Trump administration recently announced it would end the Medicare Part D Premium Stabilization Demonstration Program, which supports about 25 million Americans across the country, by the end of the year — a year earlier than initially planned.
Hochul called on the administration to stop the planned cuts on Wednesday, Aug. 5, as she says those impacted in New York — around 1.3 million seniors — could start seeing higher prescription drug costs as soon as next year.
"While Republicans are hellbent on making life harder and more expensive for hard-working Americans,
I'm staying laser-focused on helping seniors and putting money back into New Yorkers' pockets," Hochul said.
Here's what to know.
Why is the Trump administration ending Medicare Part D subsidies?
The coverage is no longer necessary, according to Centers for Medicare & Medicaid Services (CMS) Administrator Mehmet Oz.
"The Biden admin gave BILLIONS of taxpayer money DIRECTLY to Big Insurance Companies. This is unacceptable," Oz said in a social media post announcing the policy change on July 28. "We are stabilizing the market so this bailout is no longer needed."
In response to the Inflation Reduction Act going into effect in 2022, the Biden administration created a "demonstration project" in 2024 aimed at stabilizing Part D premiums and enrollment that steered subsidies to insurance companies to keep premiums lower. According to USA TODAY reporting, the project cost the federal government $9.8 billion in 2025 and 2026.
Through the project, the average monthly premium for a stand-alone drug plan fell from $43 in 2024 to $36 in 2026 and enrollment increased from 23 million to 25 million nationwide, USA TODAY says.
How much could New Yorkers' insurance premiums increase?
It's still a bit unclear.
CMS said they'll release details on monthly premiums for Medicare prescription drug plans and privately administered Medicare Advantage plans in September, USA TODAY reported. However, Oz shared that premiums will go up by less than $10 for "most Medicare recipients" and "many" will see lower premiums.
Contributing: USA TODAY
Emily Barnes covers state government for the USA TODAY Network-New York with a focus on how policy and laws impact New Yorkers' taxes, communities and jobs. Follow her on Instagram or X @byemilybarnes. Get in touch at ebarnes@usatodayco.com.
This article originally appeared on Rockland/Westchester Journal News: Why Medicare costs could soon increase for 1.3 million New Yorkers
