Medicare's annual open enrollment period begins Oct. 15, and beneficiaries may find fewer options as carriers scale back their plans.
Market contractions cut across Medicare Advantage, the privately run alternative to traditional government-run Medicare, and stand-alone Part D drug plans that pair with traditional Medicare. About one million Advantage members are in plans that are being discontinued for 2027. The number of stand-alone Part D drug plans nationwide will fall to 316 next year from 360, according to KFF, a health policy nonprofit.
While most of the nation's 64 million Medicare recipients will still have plenty of options to choose from, these changes underscore the importance of shopping during open enrollment. Through Dec. 7, beneficiaries can pick a new stand-alone Part D drug plan or a new Medicare Advantage plan, or switch from traditional Medicare into Medicare Advantage or vice versa. (Medigap supplement policies are largely regulated at the state level and aren't part of open enrollment.)
By now, beneficiaries should have received an Annual Notice of Change from their plan outlining anything new for next year. Research your options on the plan finder tool on Medicare.gov. Any coverage changes made during this period will go into effect Jan. 1, 2027.
Medicare Advantage
Medicare Advantage now enrolls about 35 million people, or about 55% of the Medicare population, according to KFF. (Advantage members are ineligible for the $90 premium rebates the Trump administration recently pledged to Medicare recipients to "make coverage more affordable." To qualify, seniors must be on traditional Medicare.)
Plan closures come as some Advantage insurers shift their focus to profitability over enrollment growth. Humana has said that about 600,000 members, or nearly 9% of its total enrollment, will be affected by plan exits for 2027. UnitedHealthcare and CVS Health's Aetna are also terminating plans.
The weighted average monthly premium across Medicare Advantage plans is projected to decline 16.5% to $12 next year, according to the Centers for Medicare & Medicaid Services.
Beyond the premium, pay attention to copayments, coinsurance, and deductibles. Copayments are flat fees, while coinsurance is the percentage of the bill that you're responsible for. Deductibles are the amount you must pay each year before insurance kicks in to cover most services.
Many plans heavily advertise extras like gym memberships and over-the-counter cards that give an allowance for certain items. These are nice perks, but they shouldn't drive your enrollment decision. Far more important is whether your doctors take your insurance. Medicare Advantage plans have networks of participating providers, and restricting doctor access is one lever insurers have to control costs. (In traditional Medicare, you can see any doctor in the country that takes Medicare.)
Medicare's Plan Finder tool links to insurers' online provider directories. To confirm your doctors' participation, call the office and ask if they take the plans you're considering. Another resource is Matchyourmedicare.com, a free educational site that searches for plans that include your doctors and estimates your individual costs based on your medications and other health needs.
Open enrollment offers the opportunity to leave Medicare Advantage for traditional Medicare. An important caveat is that -- outside of limited circumstances and a handful of states -- you aren't guaranteed the ability to buy a Medigap supplement plan to cover what traditional Medicare doesn't. Barring certain exemptions, insurers can charge you more or deny you outright based on your health status. One exception is if your Medicare Advantage plan is being discontinued; that triggers a window to buy a Medigap plan without medical underwriting.
Medicare Part D
The total average monthly Part D premium for stand-alone prescription drug plans is projected to increase to $36 in 2027 from $35.09 this year, according to the CMS. However, there's wide variability beyond these averages. While monthly premiums for several national Part D plans will decrease or increase by less than $10 in many states, according to a KFF analysis, some premiums will rise by $50 or more.
Look beyond the premium to your plan's formulary, as the list of covered drugs is called. If a plan drops coverage of a medication or switches it to a higher coverage tier, your costs will go up.
Some bad news for those with higher medication needs: The spending cap on Part D out-of-pocket costs will rise to $2,400 from $2,100 this year.
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