Medicare

In this class, we&rsquo;ll walk you through what&rsquo;s changing in 2027, what it could mean for your coverage, and the simple steps you can take before Annual Enrollment ends on December 7.

About This Class

Every fall, Medicare sets the rules for the year ahead, and the 2027 changes are worth a close look. Some costs are creeping up, prescription drug limits are shifting, and select Medicare Advantage plans are leaving certain areas.
The good news is you don&rsquo;t need to become a Medicare expert. You do need to know what&rsquo;s changing and whether your current coverage still fits.
In this class, we&rsquo;ll cover:
<ul>
<li>
What&rsquo;s changing for costs and drug coverage in 2027. Part B premiums and deductibles, the new Part D out-of-pocket limit and deductible, changes to certain Medicare Supplement plans, and how income affects what you pay.
</li>
<li>
The drug protections that continue in 2027. Including the out-of-pocket cap, the insulin cap, no-cost vaccines, and the 15 additional drugs with Medicare-negotiated prices.
</li>
<li>
Plan changes and what to do before December 7. Which plans are leaving certain areas, what your Annual Notice of Change tells you, and five steps to take before Annual Enrollment ends.
</li>
</ul>

Several Medicare premiums, deductibles, and out-of-pocket limits are changing in 2027. While some costs are increasing, others are expected to decrease. Let&rsquo;s start with Part B, then look at what&rsquo;s new for prescription drug coverage.
Part B Premium and Deductible
According to the 2026 Medicare Trustees Report, the standard Part B premium is projected to increase to $209.50 per month, up from $202.90 in 2026.&sup1; The annual Part B deductible is projected to rise from $283 to about $292.&sup1;
Keep in mind that these are projections. CMS will announce the official 2027 Part B amounts later this year, so these figures could still change.
Part D Prescription Drug Coverage
We already know several important numbers for Part D prescription drug coverage in 2027:
<ul>
<li>
Out-of-pocket limit: $2,400, up from $2,100 in 2026&sup2;
</li>
<li>
Standard deductible: $700, up from $615 in 2026&sup2;
</li>
<li>
Base beneficiary premium: $41.33&sup3;
</li>
</ul>
Don&rsquo;t be fooled by that last number. The base beneficiary premium is what Medicare uses to calculate plan premiums and late enrollment penalties (LEP). It is not necessarily the amount you&rsquo;ll pay each month.
What&rsquo;s Happening to Stand-Alone Drug Plan Premiums
People with stand-alone Part D plans may also see changes to their monthly premiums. According to CMS, the average monthly premium is projected to increase slightly, from $35.09 in 2026 to approximately $36 in 2027.⁴
However, actual premiums will vary by plan, so it&rsquo;s important to review what your specific coverage will cost next year.
Higher Deductibles and Out-of-Pocket Limits for Certain Medicare Supplement Plans
If you have a high-deductible Medicare Supplement (Medigap) Plan F, G, or J, your annual deductible will increase to $3,050 in 2027.⁵ This is the amount you must pay in covered out-of-pocket expenses before your Medigap policy begins paying benefits.
With high-deductible Plan G, what you pay toward the Medicare Part B deductible counts toward the $3,050 annual deductible, even though Plan G does not cover the Part B deductible itself.
CMS also announced that the 2027 annual out-of-pocket limits for Medicare Supplement Plans K and L will be $8,360 and $4,180, respectively.⁶
These deductible and out-of-pocket limit changes apply only to the specific Medicare Supplement plans mentioned above, not all Medigap policies.
Higher-Income Beneficiaries May Pay More
If your income is above certain limits, you may pay an additional amount for Part B and Part D known as an Income-Related Monthly Adjustment Amount, or IRMAA. Our class &ldquo;IRMAA: Medicare&rsquo;s Surcharge on Premiums&rdquo; explains how it works.
Your 2027 IRMAA is generally based on income reported on your 2025 federal tax return.⁷ The official 2027 income brackets will be announced later this year.
If your income has since dropped because of certain life-changing events, such as retiring or reducing your work hours, getting divorced, losing a spouse, or losing certain pension income, you may be able to ask Social Security to use more recent income information. You can do this using Form SSA-44.⁸
 SOURCES
<ol>
<li>
&ldquo;2026 Medicare Trustees Report.&rdquo; CMS.gov, 9 June 2026,<a href="https://www.cms.gov/oact/tr/2026"> https://www.cms.gov/oact/tr/2026</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;How much does Medicare drug coverage cost?&rdquo; Medicare.gov,<a href="https://www.medicare.gov/health-drug-plans/part-d/basics/costs"> https://www.medicare.gov/health-drug-plans/part-d/basics/costs</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Medicare Part D 2027 National Average Monthly Bid Amount Information.&rdquo; CMS.gov, 28 July 2026,<a href="https://www.cms.gov/newsroom/fact-sheets/medicare-part-d-2027-national-average-monthly-bid-amount-information"> https://www.cms.gov/newsroom/fact-sheets/medicare-part-d-2027-national-average-monthly-bid-amount-information</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Medicare Advantage and Medicare Prescription Drug Programs Expected to Remain Stable in 2027.&rdquo; CMS.gov, 28 September 2026,<a href="https://www.cms.gov/newsroom/press-releases/medicare-advantage-medicare-prescription-drug-programs-expected-remain-stable-2027"> https://www.cms.gov/newsroom/press-releases/medicare-advantage-medicare-prescription-drug-programs-expected-remain-stable-2027</a>. Accessed 27 October 2026.
</li>
<li>
&ldquo;F, G &amp; J Deductible Announcements.&rdquo; CMS.gov, October 2026,<a href="https://www.cms.gov/medicare/health-drug-plans/medigap/f-g-j-deductible-announcements"> https://www.cms.gov/medicare/health-drug-plans/medigap/f-g-j-deductible-announcements</a>. Accessed 27 October 2026.
</li>
<li>
&ldquo;K &amp; L Out-of-Pocket Limits Announcements.&rdquo; CMS.gov, October 2026,<a href="https://www.cms.gov/medicare/health-drug-plans/medigap/k-l-out-of-pocket-limits-announcements"> https://www.cms.gov/medicare/health-drug-plans/medigap/k-l-out-of-pocket-limits-announcements</a>. Accessed 27 October 2026.
</li>
<li>
&ldquo;Medicare Premiums: Rules for Higher-Income Beneficiaries.&rdquo; Social Security Administration,<a href="https://www.ssa.gov/benefits/medicare/medicare-premiums.html"> https://www.ssa.gov/benefits/medicare/medicare-premiums.html</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Request to lower an Income-Related Monthly Adjustment Amount (IRMAA).&rdquo; Social Security Administration,<a href="https://www.ssa.gov/medicare/lower-irmaa"> https://www.ssa.gov/medicare/lower-irmaa</a>. Accessed 22 October 2026.
</li>
</ol>

While some costs are increasing, several protections designed to help limit prescription drug expenses will continue in 2027:
<ul>
<li>
Prescription drug costs remain capped. In 2027, you&rsquo;ll pay no more than $2,400 out of pocket for covered Part D drugs. Once you reach that amount, you won&rsquo;t pay anything for covered Part D drugs for the rest of the year.&sup1;
</li>
<li>
Insulin remains capped at $35 for a month&rsquo;s supply of each covered insulin product, with no deductible.&sup2;
</li>
<li>
Recommended adult vaccines remain covered at no cost under Part D, including vaccines for shingles and RSV.&sup3;
</li>
<li>
The Medicare Prescription Payment Plan continues. This optional program allows you to spread your out-of-pocket prescription drug costs throughout the year instead of paying larger amounts at the pharmacy all at once.⁴
</li>
<li>
Extra Help continues to provide assistance with Part D premiums and other prescription drug costs for people who qualify based on income and resources.⁵
</li>
</ul>
More Prescription Drugs Will Have Medicare-Negotiated Prices
Another change takes effect January 1, 2027: 15 additional prescription drugs will have prices negotiated by Medicare, joining the first 10 drugs with negotiated prices that took effect in 2026.⁶ The 2027 list includes medications such as Ozempic, Rybelsus, and Wegovy, along with drugs used to treat cancer, asthma, and other conditions.⁷
Keep in mind that a lower negotiated price doesn&rsquo;t necessarily mean every person will have a lower copay. What you pay will still depend in part on your specific Medicare drug plan and how it covers your medications. That&rsquo;s another reason to check your plan&rsquo;s formulary, its list of covered medications, before deciding whether to keep your coverage for 2027.
Comparing Prices with TrumpRx.gov
TrumpRx.gov is a federal website that shows cash prices and coupons for some prescription drugs.⁸ When you use TrumpRx and other discount cards instead of your Medicare plan, what you spend doesn&rsquo;t count toward your deductible or your $2,400 out-of-pocket limit.⁹ Before you decide, compare the TrumpRx.gov price with what you&rsquo;d pay under your plan. 
SOURCES
<ol>
<li>
&ldquo;How much does Medicare drug coverage cost?&rdquo; Medicare.gov,<a href="https://www.medicare.gov/health-drug-plans/part-d/basics/costs"> https://www.medicare.gov/health-drug-plans/part-d/basics/costs</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Insulin.&rdquo; Medicare.gov,<a href="https://www.medicare.gov/coverage/insulin"> https://www.medicare.gov/coverage/insulin</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Medicare Part D Vaccines.&rdquo; MLN908764. CMS.gov, July 2026,<a href="https://www.cms.gov/files/document/mln908764-medicare-part-d-vaccines.pdf"> https://www.cms.gov/files/document/mln908764-medicare-part-d-vaccines.pdf</a>. Accessed 23 October 2026.
</li>
<li>
&ldquo;Medicare Prescription Payment Plan.&rdquo; CMS.gov,<a href="https://www.cms.gov/inflation-reduction-act-and-medicare/part-d-improvements/medicare-prescription-payment-plan"> https://www.cms.gov/inflation-reduction-act-and-medicare/part-d-improvements/medicare-prescription-payment-plan</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;2027 Medicare Advantage and Part D Landscape: State-by-State Fact Sheets.&rdquo; CMS.gov,<a href="https://www.cms.gov/files/document/2027-medicare-advantage-part-d-landscape-state-state-fact-sheets.pdf"> https://www.cms.gov/files/document/2027-medicare-advantage-part-d-landscape-state-state-fact-sheets.pdf</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Selected Drugs and Negotiated Prices.&rdquo; CMS.gov,<a href="https://www.cms.gov/initiatives/medicare-prescription-drug-affordability/overview/medicare-drug-price-negotiation-program/selected-drugs-negotiated-prices"> https://www.cms.gov/initiatives/medicare-prescription-drug-affordability/overview/medicare-drug-price-negotiation-program/selected-drugs-negotiated-prices</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Medicare Drug Price Negotiation Program: Selected Drugs for Initial Price Applicability Year 2027.&rdquo; CMS.gov, 17 January 2025,<a href="https://www.cms.gov/files/document/factsheet-medicare-negotiation-selected-drug-list-ipay-2027.pdf"> https://www.cms.gov/files/document/factsheet-medicare-negotiation-selected-drug-list-ipay-2027.pdf</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Your Medicare in 2027: What&rsquo;s New &amp; Changing.&rdquo; 12229. Medicare.gov,<a href="https://www.medicare.gov/publications/12229-your-medicare-in-2027-whats-new-and-changing.pdf"> https://www.medicare.gov/publications/12229-your-medicare-in-2027-whats-new-and-changing.pdf</a>. Accessed 27 October 2026.
</li>
<li>
&ldquo;Help with drug costs.&rdquo; Medicare.gov,<a href="https://www.medicare.gov/basics/costs/help/drug-costs"> https://www.medicare.gov/basics/costs/help/drug-costs</a>. Accessed 27 October 2026.
</li>
</ol>

Medicare&rsquo;s Annual Enrollment Period (AEP) runs from October 15 to December 7, 2026, and any changes you make will go into effect for 2027.&sup1; Rising costs are only half the story. Plans change what they cover, which doctors and pharmacies they include, and sometimes whether they&rsquo;re offered in your area at all.
Some Medicare Advantage Plans Are Changing or Leaving Certain Areas
For the third year in a row, some Medicare Advantage insurers are reducing the number of plans or areas they serve. Humana, for example, has announced plan exits that will affect roughly 600,000 members in 2027.&sup2; Other insurers are also making changes as rising medical and prescription drug costs, along with changes in how Medicare Advantage plans are paid, put pressure on plan costs.
On a positive note, average Medicare Advantage monthly premiums nationwide are projected to decrease from $14.37 in 2026 to $12 in 2027, according to CMS.&sup1; Keep in mind these are national averages. Your actual costs, benefits, and available plans will depend on where you live and the coverage you choose.
What matters most is what&rsquo;s happening with your plan where you live. And even if your Medicare Advantage plan isn&rsquo;t going away, don&rsquo;t assume it will stay the same. For 2027, you could see changes such as:
<ul>
<li>
Reduced dental, vision, or hearing benefits
</li>
<li>
A reduced or eliminated over-the-counter benefit
</li>
<li>
Changes to your provider network
</li>
<li>
Prescriptions moved to a different drug tier or removed from the plan&rsquo;s formulary
</li>
<li>
Higher copays or out-of-pocket limits
</li>
<li>
Changes to additional benefits, such as grocery or other supplemental benefits
</li>
</ul>
The important takeaway: don&rsquo;t let your Medicare plan renew without reviewing what&rsquo;s changing for 2027.
Watch for an Important Notice from Your Medicare Plan
Your current Medicare plan will send you information this fall explaining what will happen to your coverage in 2027. Don&rsquo;t toss it aside. It may be one of the most important pieces of Medicare mail you receive all year.
If your plan is continuing in 2027, look for your Annual Notice of Change (ANOC). It explains what&rsquo;s changing with your plan for the coming year, including things like:
<ul>
<li>
Monthly premiums
</li>
<li>
Deductibles and copays
</li>
<li>
Prescription drug coverage
</li>
<li>
Provider networks
</li>
<li>
Dental, vision, and other benefits
</li>
<li>
Out-of-pocket limits
</li>
</ul>
Even if you&rsquo;ve been happy with your plan, review this notice carefully. A plan that worked well for you in 2026 may not be the best fit in 2027.
If your plan is no longer available where you live, you&rsquo;ll receive a notice explaining that your coverage will not continue in 2027 and outlining your options and deadlines.&sup3;
This doesn&rsquo;t mean you&rsquo;re losing Medicare. Your Part A and Part B coverage isn&rsquo;t going away. It means you&rsquo;ll need to decide how you want to receive your Medicare coverage in 2027. If your Medicare Advantage plan is not renewed and you don&rsquo;t choose another Medicare Advantage plan before your current coverage ends, you&rsquo;ll generally return to Original Medicare.&sup3; You may need to enroll in a separate Part D plan to maintain prescription drug coverage. You may also have a Special Enrollment Period and certain rights to purchase a Medicare Supplement (Medigap) policy.
Pay close attention to the dates and instructions in the notice you receive, since your options and deadlines can depend on your situation.
Five Things to Do Before December 7
The most important thing is understanding what&rsquo;s changing in your coverage and whether your current plan still meets your needs.
<ol>
<li>
Find your plan notice. Review the ANOC or other notice you receive from your current plan.
</li>
<li>
Make a list of what matters to you. Include your prescriptions, doctors, preferred pharmacies, and the benefits you use most.
</li>
<li>
Don&rsquo;t compare premiums alone. Look at deductibles, copays, prescription coverage, provider networks, benefits, and out-of-pocket limits, too.
</li>
<li>
Review your options before December 7. Even if you&rsquo;re happy with your current coverage, make sure it still fits your health needs and budget for 2027.
</li>
<li>
Get help if you want it. A licensed insurance advisor can help you understand what&rsquo;s changing, compare available options, and determine whether your current coverage still fits your needs.
</li>
</ol>
 SOURCES
<ol>
<li>
&ldquo;Medicare Advantage and Medicare Prescription Drug Programs Expected to Remain Stable in 2027.&rdquo; CMS.gov, 28 September 2026,<a href="https://www.cms.gov/newsroom/press-releases/medicare-advantage-medicare-prescription-drug-programs-expected-remain-stable-2027"> https://www.cms.gov/newsroom/press-releases/medicare-advantage-medicare-prescription-drug-programs-expected-remain-stable-2027</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Humana exit notices loom for 600,000 Medicare Advantage members.&rdquo; Healthcare Finance News, 1 September 2026,<a href="https://www.healthcarefinancenews.com/news/humana-exit-notices-loom-600000-medicare-advantage-members"> https://www.healthcarefinancenews.com/news/humana-exit-notices-loom-600000-medicare-advantage-members</a>. Accessed 22 October 2026.
</li>
<li>
&ldquo;Plan Non-Renewal Notice.&rdquo; Medicare.gov,<a href="https://www.medicare.gov/basics/forms-publications-mailings/mailings/costs-and-coverage/change-in-plan-availability"> https://www.medicare.gov/basics/forms-publications-mailings/mailings/costs-and-coverage/change-in-plan-availability</a>. Accessed 22 October 2026.
</li>
</ol>

Medicare costs are expected to rise modestly in 2027, with the Part B premium projected at $209.50 per month.&sup1; The Part D out-of-pocket limit is also increasing to $2,400.&sup2; You also learned that stand-alone Part D plans may see premium changes now that a temporary stabilization program is ending, that important drug protections like the $35 insulin cap continue, and that 15 more drugs will have Medicare-negotiated prices. At the same time, some Medicare Advantage plans are leaving certain areas, and others are changing their benefits.
The biggest takeaway: you don&rsquo;t need to become a Medicare expert, but you do need to review your coverage. Find your Annual Notice of Change, make a list of your prescriptions and doctors, and compare more than just the premium before Annual Enrollment ends on December 7.
Next steps
<ul>
<li>
Brush up on how surcharges work in &ldquo;<a href="/retirement-school/irmaa" rel="follow">IRMAA: Medicare&rsquo;s Surcharge on Premiums</a>&rdquo;
</li>
<li>
Take a deeper look at drug coverage in &ldquo;<a href="/retirement-school/medicare-part-d" rel="follow">Navigating Medicare Part D for Prescription Drugs</a>&rdquo;
</li>
<li>
Make sure you&rsquo;re not caught off guard by &ldquo;<a href="/retirement-school/how-to-avoid-common-medicare-mistakes" rel="follow">How to Avoid Common Medicare Mistakes</a>&rdquo;
</li>
</ul>
Not affiliated with the U.S. government or federal Medicare program. Not affiliated with any federal agency.
 SOURCES
<ol>
<li>
&ldquo;2026 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds.&rdquo; CMS.gov, 9 June 2026,<a href="https://www.cms.gov/oact/tr/2026"> https://www.cms.gov/oact/tr/2026</a>, Table V.E2. Accessed 22 October 2026.
</li>
<li>
&ldquo;How much does Medicare Part D drug coverage cost?&rdquo; Medicare.gov,<a href="https://www.medicare.gov/health-drug-plans/part-d/basics/costs"> https://www.medicare.gov/health-drug-plans/part-d/basics/costs</a>. Accessed 22 October 2026.
</li>
</ol>

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Every fall, Medicare changes the rules for the year ahead, and the 2027 changes are worth a close look. Some costs are creeping up, prescription drug limits are shifting, and select Medicare Advantage plans are leaving certain areas. The good news is you don’t need to become a Medicare expert. In this class, we’ll walk you through what’s changing in 2027, what it could mean for your coverage, and the simple steps you can take before Annual Enrollment ends on December 7.


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Medicare Changes for 2027: What You Need to Know

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