DCI’s exclusive analysis of Center for Medicare & Medicaid Services’ (CMS) data reveals:
- The number of PDPs has plummeted by 55% since the IRA’s passage, to a record low of 360 plans for 2026.
- Preferred cost-sharing pharmacy networks are disappearing, with their share falling to the lowest level since 2014. That’s a post-IRA net loss of 505 plans with these networks.
- Just five companies—Aetna, Health Care Service Corporation, Humana, UnitedHealthcare, Wellcare—will account for 94% of all PDPs in 2026. In recent years, four major plan sponsors—Cigna, Clear Spring Health, Elevance Health, and Mutual of Omaha—have exited the PDP market.
Even with the demonstration program handouts, the Part D market is increasingly fragile: fewer choices, greater concentration, and massive disruption for beneficiaries.
Thanks, IRA! 🙃
What else should you expect for 2026? Find out during my upcoming live video webinar, Drug Channels Outlook 2026, on December 12, 2025, from 12:00 p.m. to 1:30 p.m. ET. Click here to learn more and sign up. As always, we are offering special discounts if you want to bring your whole team.
D IS FOR DATA
A preferred network gives consumers a choice of pharmacy while providing financial incentives to use the pharmacies that offer the payer lower costs or greater control. A consumer with a preferred network benefit design retains the option of using any pharmacy in the network. However, the consumer’s out-of-pocket expenses will be higher at a non-preferred pharmacy.
Within the Medicare Part D program, CMS calls these preferred cost sharing networks and refers to participating pharmacies as preferred cost sharing pharmacies.
According to federal regulations, preferred pharmacies in Part D must offer “covered Part D drugs at negotiated prices to Part D enrollees at lower levels of cost sharing than apply at a non-preferred pharmacy under its pharmacy network contract.” (source) Beneficiaries who qualify for the Low-Income Subsidy (LIS) face minimal out-of-pocket drug costs regardless of a pharmacy’s preferred status.
We identified 2026 Part D preferred cost sharing pharmacy networks using the Beneficiary Cost file from Monthly Prescription Drug Plan Formulary and Pharmacy Network Information (October 20, 2025) and the 2026 Landscape files (September 2025) for PDPs and MA plans.
Our analysis of stand-alone PDPs excluded the following plans:
- Employer-sponsored plans
- Plans from U.S. territories and possessions (American Samoa, Guam, Northern Mariana Islands, Puerto Rico, Virgin Islands)
- Employer/union-only group plans (contracts with "800 series" plan IDs)
D-EEP DIVE INTO DATA
Our final PDP sample included 34 PDPs (down from 42 in 2025), operating 360 regional PDPs (vs. 464 in 2025):
- Ten plans are being offered in 26 to 34 regions, for a total of 329 PDPs.
- The remaining 24 plans are operating in four or fewer regions and account for 31 PDPs. Many of these plans are state-level Blue Cross Blue Shield plans.
- Health maintenance organizations (HMOs): 1,942 local plans
- Preferred provider organizations (PPOs): 1,345 local plans and 21 regional plans
- Private fee-for-service (PFFS) plans: 21 plans
D-CLINE OF PART D
The chart below shows the prevalence of preferred networks in stand-alone prescription drug plans since 2011.
[Click to Enlarge]
In 2011, only 7% of total regional PDPs had a preferred network. By 2023, that share peaked at 98%. For 2026, it will drop to 79%—its lowest point since 2014.
What's more, the total number of PDPs in 2026 will decline for the fourth straight year and mark a new low for the program. Since the passage of the Inflation Reduction Act (IRA), the number of PDPs has plummeted by 55%, from 804 in 2023 to 360 plans in 2026.
Compared with 2025, the absolute number of plans with preferred networks decreased by 105 plans, while the number with open networks increased by one plan.
MA-PDs are less likely to offer plans with preferred pharmacy networks. Overall, slightly less than half of these plans will have preferred networks, which is comparable to the previous year’s share. The prevalence of preferred pharmacy networks will vary by plan type:
[Click to Enlarge]
D-EPARTURES
Here are the 2026 highlights from five major companies with national stand-alone PDPs. These companies account for 94% (337 of 360) of total PDPs. Only two of the 12 companies’ plans will have an open retail network. The other 10 plans will have preferred cost sharing networks.
- Aetna Medicare is offering only the legacy CVS Health SilverScript Choice plan. For 2025, SilverScript Choice had switched from a preferred retail network to an open network.
- Health Care Service Corporation (HCSC) is offering two of Cigna’s three PDPs—Assurance Rx and Extra Rx—under the HealthSpring name. It is also offering two of the three Blue Cross plans that it had offered for 2025.
- Humana is offering two of the plans—Humana Basic Rx and Humana Premier Rx Plan—that it has offered since 2020. Beginning in 2025, the co-branded Humana Walmart Value Rx Plan was renamed as the Humana Value Rx Plan. The Humana Basic Rx plan has had an open network since 2024.
- UnitedHealthcare is offering the same two AARP-branded plans—AARP Medicare Rx Preferred and AARP Medicare Rx Saver—that is has offered since 2024.
- WellCare, which is now part of Centene, is offering two plans in 2026: Wellcare Classic and Wellcare Value Script. It no longer offers the Wellcare Medicare Rx Value Plus plan.
- Cigna, which sold its Medicare businesses to HCSC.
- Elevance Health, which is offering only two plans operating in one region each—down from six plans operating in 20 regions for 2025.
D-ISASTER FOR PART D
Shortly after the IRA passed, I warned it would trigger the collapse of the PDP market. Sadly, my prediction has undeniably come true, even as the IRA’s staunch defenders have tried to deny the economic realities behind the market’s collapse.
Today, enrollment in MA-PD plans is nearly 40% higher than PDP enrollment. That translates into more than 9 million Medicare beneficiaries who receive prescription benefits from MA plans rather than original Medicare plus a PDP. Check out this useful CMS Medicare Enrollment Dashboard.
Meanwhile, Part D plans are shifting costs in ways that hurt many enrollees with higher deductibles and a greater reliance on coinsurance for nonspecialty brand drugs. Participants in PDPs have been hit harder than those in MA-PD plans. And while high-cost drug users benefit from major relief, many moderate and low spenders may actually see higher overall costs.
As Jennifer Snow has noted, the vanishing PDP market directly hurts at least three groups:
- Seniors in rural areas
- Beneficiaries who have a Medigap policy plus Original Medicare
- Those in employer group waiver plans (EGWPs) with customized PDPs
For 2026, CMS also rejected bids from an unspecified number of PDPs.
WHAT’S NEXT?
The PDP market’s collapse is no longer hypothetical. By 2026, we’ll have fewer plans, less competition, and tighter networks. The market will surely consolidate further in 2027 and beyond.
Join me on December 12 for the Drug Channels Outlook 2026 to hear my latest predictions for the future of the IRA and what’s ahead for the Part D market. See you then!
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