CMS Proposes Eliminating the 1-Dollar Generic Drug Copay for the Lowest-Income Medicare Dual Enrollees

A proposed rule published in the Federal Register on October 20, 2026 would eliminate the 1-dollar generic drug copayment for Medicare beneficiaries who qualify as full-benefit dual eligible individuals with incomes at or below 100 percent of the Federal Poverty Level. The change, if finalized, would take effect for Part D plan years beginning January 1, 2028.

The proposal carries out Section 6219 of the Consolidated Appropriations Act, 2026, which directed the Centers for Medicare and Medicaid Services to adjust cost-sharing reductions for low-income Part D enrollees. Under current rules, full-benefit dual eligible individuals in this income tier pay up to 1 dollar in copayments for covered generic drugs. The proposed rule would reduce that amount to zero.

Full-benefit dual eligible individuals are people who qualify for both Medicare and Medicaid. Those with incomes at or below 100 percent of the Federal Poverty Level represent the lowest-income tier within that group. They already receive help with Part D premiums and cost-sharing through the Low-Income Subsidy program, but a small copayment for generics has remained in place.

CMS estimated the proposed provision would cost the federal government approximately 1.337 billion dollars over the 2028 to 2037 period. The agency stated that potential benefits include improved medication access and adherence for low-income Part D beneficiaries.

The same proposed rulemaking also addresses pharmacy benefit manager transparency requirements and Medicare Advantage provider directory accuracy standards under separate provisions of the 2026 law. Public comments on the full proposed rule are due by December 15, 2026.