10/12/2026
Three Medicare changes take effect on Jan. 1, 2027, and two of them arrive quietly, inside paperwork most people rarely open.
The first is a subsidy that is ending. In 2025, Medicare started a temporary program that held down premiums on standalone Part D drug plans after the drug benefit was redesigned. On July 28, Medicare announced it will discontinue that program at the end of 2026, saying insurers now have enough experience to price their plans without it. The base premium Medicare uses to set Part D premiums rises to $41.33 a month for 2027, up from $38.99. That is a benchmark, not a bill. Each plan sets its own price, and some will move more than others.
The second change is the yearly cap on drug costs. Once your out-of-pocket spending on covered Part D drugs reaches the cap, you pay nothing more for those drugs for the rest of the calendar year. The cap was $2,100 in 2026 and rises to $2,400 in 2027. For someone on an expensive medication, that is $300 more before the protection kicks in. The standard deductible goes from $615 to $700, and a plan can set a lower one.
The third change is the one that can leave a person scrambling. Some insurers are closing Medicare Advantage plans for 2027. A plan leaving at year-end must send a non-renewal letter dated Oct. 2, except special needs plans, and coverage under the old plan ends Dec. 31. Anyone who does not join another Medicare Advantage plan is moved to Original Medicare. Original Medicare does not include drug coverage, so a separate drug plan has to be added. A plan that is not renewed opens a special window to choose another, from Dec. 8 through the last day of February.
Every plan had to mail an Annual Notice of Change for members to receive by Sept. 30. It lists what changes on Jan. 1, from the premium and the deductible to the drug list. It is the most useful document in the whole process, and it usually looks like junk mail.
Pull up the notice, write down every drug you take and the pharmacy you use, and let us assist you with finding a Medicare Advantage Plan that works for you and your budget for 2027. Open enrollment runs Oct. 15 to Dec. 7, and a plan chosen by Dec. 7 starts Jan. 1.
Plenty of plans will barely change, and a plan that still covers the same drugs at a similar cost can simply stay. The point is to know, before Dec. 7, whether staying is still the right call.
We would love the opportunity to assist you. Give us a call! There is no cost to have us as your agent, and we'll help you navigate all of your options.
Agents of the Preferred Insured
1469 Fort Street
Wyandotte, MI 48192
734-250-9800
Source: CMS, CY 2027 Rate Announcement (April 6, 2026) and July 28, 2026 Part D bid memo; 42 CFR 422.2267; Medicare.gov, Part D costs and enrollment periods.
