Expect Some Changes to Medicare Advantage Plans in 2027

Takeaways

• An estimated 3 million Medicare Advantage members must find a new plan for 2027. Average premiums are dropping while deductibles, copays, and out-of-pocket limits rise.

• Keeping the same Medicare Advantage plan doesn’t mean keeping the same coverage. Your doctors, drug costs, and extra benefits like dental may change.

• Open enrollment ends December 7. Review your Annual Notice of Change, compare plans, and seek advice if needed.

If you have a Medicare Advantage plan, the plan you have today may not look the same next year. Though the Centers for Medicare & Medicaid Services (CMS) estimates that monthly premiums will remain mostly steady, out-of-pocket costs, extra benefits, and plan choices are changing. 

These changes mean you should take a close look at your plan and its costs and benefits. Open enrollment runs through December 7, so there is still time to act.

What Is Changing

As 2027 approaches, key aspects of Medicare Advantage are changing. Understanding how your plan may change is vital to ensure you continue to have the best plan for your needs.

• Fewer plans will be available. With insurers ending plans or leaving certain areas, an estimated 3 million Medicare Advantage members must find new plans. The average Medicare enrollee can choose from 28 plans with drug coverage for 2027, down from 32 this year. General-enrollment Medicare Advantage with drug coverage will not be available across 193 counties and 16 states, affecting around 638,000 people.

• Premiums will be lower as costs rise elsewhere. The federal government reports the average Medicare Advantage premium will drop from $14.37 to $12 a month. Deductibles, copays, and out-of-pocket limits, however, are set to rise.

• Reduced extras and available networks. Insurers are cutting some extra benefits, such as dental coverage. Additionally, some are dropping plans with broad doctor and hospital networks.

• Rising drug costs. The standard drug deductible will rise from $615 to $700. The yearly cap on what you pay for covered Part D drugs will rise from $2,100 to $2,400. 

• Part B premiums are likely to increase. You still pay the Part B premium with a Medicare Advantage plan, which is projected to rise from $202.90 to about $209.50 a month.

What This Means for You

Most people will still have several plans to choose from. However, keeping the same plan does not mean keeping the same coverage. A doctor may no longer be in network, a drug may cost more, or a dental benefit may shrink, or disappear.

The changes may matter most if you:

• See specialists often or take expensive medications

• Rely on dental, hearing, or vision benefits

• Live in a rural area with fewer plan options

Doing nothing can be costly. If your plan is ending and you don’t pick a new one, you will automatically be moved to Original Medicare. While that may not seem like an issue, Original Medicare (Parts A and B) doesn’t include a prescription drug plan.

Unless you subscribe to Part D, which covers prescriptions, you could lose drug coverage. If you require a prescription, you could find yourself paying full price at the pharmacy come January 1.

Going without drug coverage can also bring a penalty that lasts for life. If you go 63 or more days in a row without Medicare drug coverage or other creditable coverage, you may owe a late enrollment penalty. That penalty is permanently added to your Part D premium.

How to Prepare

With a few weeks remaining in the open enrollment period, a few key steps can make the difference for your 2027 coverage.

• Read your Annual Notice of Change (ANOC). Your plan provider must send an ANOC each fall. Look for new premiums, deductibles, copays, and the yearly out-of-pocket limit.

• Review your available doctors and prescription needs. Confirm your doctors, hospitals, and pharmacy are still in network and that your medications are still covered.

• Compare all of your available options. Medicare Plan Finder is a helpful tool, or you can call 1-800-MEDICARE (1-800-633-4227) for assistance.

• Get free, unbiased help from your State Health Insurance Assistance Program (SHIP). They offer one-on-one counseling and advice.

• Consider the total cost of the plan, not just the premium. Add the deductible, copays, and out-of-pocket limit for a bad health year, not just a good one.

• Keep track of important deadlines. Choose a plan between October 15 and December 7 for coverage starting January 1. You can switch plans or return to Original Medicare once between January 1 and March 31. If your plan is ending, you may get extra time to choose, so check your notice.

• Ask about financial help. Extra Help and Medicare Savings Programs may lower your drug and premium costs. 

• Consider Medigap. If you decide to move from Medicare Advantage to Original Medicare, you may be eligible for special protections when buying a Medigap policy.

Additional Reading

For additional reading on issues related to Medicare plan changes, check out the following articles:

• Medicare Coverage Basics: What You Need to Know

• Entering and Leaving Medicare Advantage Plans

• Turning 65? What to Know About the 4 Parts of Medicare

• Medicare Part B: Doctor Visits and Preventative Care