Jesse Smedley is a Principal of Oakbridge Insurance and the founder of iHealthBrokers. He founded iHealthBrokers in 2007, and Oakbridge acquired iHealthBrokers in 2025. He has spent nearly two decades teaching people how to save money on their health insurance and navigate Medicare, and he is the author of Medicare A to Z: Your Roadmap to Medicare.
You may have seen headlines that Medicare premiums are about to explode in 2027 or that Medicare prescription drug coverage is in trouble. But CMS tells a much calmer story. Here are the Medicare changes in 2027 that matter, and what to do about them. The national average may be up. But that number is rarely the number that decides whether your coverage really still works.
One new change affects 15 named drugs. Another affects how plans are compared and priced. But the change that affects you the most may be buried in your Annual Notice of Change.
1. 2027 Part D Premiums
The first change, and the first scary headline you’ve probably seen, concerns monthly premiums, specifically for those Part D plans.
The temporary Part D premium stabilization program ends in 2027. CMS chose to end it rather than run it for a third year. But, of course, Part D plans still exist. Although some plans will move, not all plans will move at exactly the same rate. So, your plan may not be affected as much as somebody else’s.
Even taking all that into consideration, CMS is predicting that the average stand-alone Part D plan premium for 2027 will be about $36. That’s roughly a dollar more than the 2026 average of about $35.
If you have prescription drug coverage through your Medicare Advantage plan, it matters even less. In fact, it’s actually even expected to fall.
Many Medicare Advantage plans are offered at a very low cost or even no cost. This includes those that offer prescription drug coverage. So, you can expect that your Medicare Advantage premium, at least with regard to that Part D prescription drug coverage, will remain largely stable.
Monthly premiums are certainly very important. Additionally, they are the most easily identifiable cost. However, when comparing Part D plans or Medicare Advantage plans, it’s very important that you look at other costs as well.
Compare those out-of-pocket maximums, co-pays or co-insurance for your prescriptions, and other out-of-pocket costs. If comparing Medicare Advantage plans, you want to look at doctors within the networks, as well.
2. Medicare Drug Price Negotiations
In 2027, Medicare has negotiated prices for 15 more drugs on Part D plans. And believe it or not, this is a little controversial!
The maximum fair price for these 15 new drugs will take effect on January 1, 2027. That’s in addition to the 10 drugs with negotiated prices that took effect in 2026. All in all, this is 25 drug prices negotiated by Medicare.
When looking at data from 2024, CMS estimated that about 5.3 million people took one or more of these 15 newly negotiated drugs.
And these are for very serious illnesses, things like diabetes, cancer, asthma, and other serious illnesses as well.
So, if these new negotiated prices are going to save beneficiaries so much money, why is it controversial?
If you are one of the millions of people who take one of these medications, this is undeniably a good thing. It’s something that will save you a lot of money.
But, of course, that cost has to come from somewhere. And some people argue that these negotiated prices, as well as the potential to cover Ozempic, could potentially be a factor in those increasing Part D costs.
3. Permanent Part D Changes in 2027
There is another change that you may not feel quite so much. But it’s more something that’s just good to know about for peace of mind for the future.
In recent years, there have been a tremendous amount of changes to Part D with the implementation of the out-of-pocket maximum or catastrophic coverage spending threshold, as well as negotiated drug pricing and more.
As of 2027, a lot of these changes will be permanent. Starting in 2027, CMS is writing the Part D redesign into its permanent regulations.
This means that the annual threshold is not going to expire in later years.
If you are someone who has more extensive prescription drug needs, Medicare is keeping track of your prescription drug spending. Should you reach that catastrophic coverage threshold, your covered in-network prescriptions that are on your plan’s formulary will be covered at no cost for the remainder of the calendar year.
The manufacturer discount program and selected drug subsidy are also built into these permanent changes.
But remember, those premiums that you pay for Part D don’t count toward your yearly spending. Medicare is only tracking deductibles, co-pays, and co-insurance.
4. Medicare Star Ratings Changes
The next change has to do with how the plans are rated and compared.
In recent years, star ratings have been an easy way to just get a quick glimpse into the average rating of a plan.
And if you’ve ever wondered how those star ratings are calculated, that is changing too.
Starting with the 2027 measurement year, CMS is removing 11 measures, so star ratings will lean more on outcomes, patient experience, and actual access to care. Because ratings are based on past performance, you’ll see the effect in star ratings published in later years.
Comparing Medicare Advantage plans is probably one of the more confusing aspects of using Medicare.gov.
There are a lot of documents available, but sometimes they’re not the documents that you need, or at least the documents aren’t very clear. They won’t give you the best picture when you’re trying to compare the different plans.
That is also expected to change this year with more access to plans that go into further detail regarding preventive care and more.
5. Dual Eligible Special Needs Plans
There are also changes coming down the pipeline, which will hopefully make it easier for those who are enrolled in a D-SNP.
A D-SNP is a Dual Eligible Special Needs Plan. These are designed for people who are eligible for both Medicaid and Medicare.
They’re a type of Medicare Advantage plan that offers the full range of benefits offered by Medicare, in addition to those offered by Medicaid, with very, very low costs.
If you are someone who is eligible for a D-SNP, this may be a great route to pursue.
In 2027, many of these D-SNP plans are going to offer one integrated card for both Medicaid and Medicare benefits.
Additionally, some of the burden on beneficiaries is going to be relieved. In the past, two health assessments were required, one for Medicare and one for Medicaid. Moving forward, these plans will just require one integrated health assessment.
You can learn more in the plan material specific to your plan or even on your ID card.
6. Your Annual Notice of Change
If you’re enrolled in a Medicare Advantage plan or a Part D plan, every year you should receive an Annual Notice of Change.
You should receive those Annual Notices of Change in advance of the AEP, which runs from October 15 to December 7. Our Medicare enrollment guide covers every window.
Your Annual Notice of Change is just that. It’s going to detail all of the changes to your plan that are pertinent to deciding whether to keep your current plan or switch to a different one.
It’s very important that you don’t just take for granted that your plan is still the best plan option for your needs.
You need to review your Annual Notice of Change so that you can compare your current benefits to the benefits that will be offered next year.
If your benefits have decreased, it’s very important that you compare your new options as well.
And quite frankly, even if your benefits remain the same, it’s a good idea to compare all of the plans available for 2027 because every year there are new plans, and it may be that one of the new plans is actually better suited to your needs than your current plan.
Make sure to look for changes in premiums, deductibles, copays and coinsurance, and, of course, your out-of-pocket maximum. The benefits offered may have changed as well. Comb through the plan’s formulary (here is how to compare Part D plans) to make sure that your prescription drugs are still covered. And make sure your doctors and hospitals are still in the networks.
This is something that can change drastically from year to year, and it’s one of the bigger setbacks to Medicare Advantage plans.
Many doctors and hospitals find the preauthorization requirements rather restrictive. In recent years many doctors and hospitals have been jumping ship. Make sure your doctor still accepts your plan.
Get Help With Your 2027 Medicare Review
Most Medicare changes in 2027 won’t hit everyone the same way. Your plan, your prescriptions and your doctors decide what changes for you. For the new premium and deductible numbers, see our Medicare costs page.
Want a second set of eyes before December 7? Get your free quotes or call a licensed broker at (866) 260-9829.
