Medicare in 2027: What Beneficiaries Need to Know

For the more than 66 million Americans enrolled in Medicare, 2027 will bring another year of important changes. Some will provide meaningful savings, particularly for people who take expensive prescription medications, while others could result in higher costs. Perhaps most importantly, Medicare beneficiaries should not assume that the plan that worked well for them in 2026 will necessarily remain their best choice in 2027.

Here are some of the most important issues Medicare beneficiaries should be watching.

Prescription Drug Costs Continue to Change

The redesign of Medicare Part D prescription drug coverage continues in 2027. One of the most significant protections is the annual limit on what beneficiaries will spend out-of-pocket for covered Part D medications.

For 2027, that limit increases to $2,400, up from $2,100 in 2026. Once a beneficiary reaches the annual out-of-pocket threshold, there is no additional cost sharing for covered Part D drugs for the remainder of the year. For anyone managing expensive medications, this ceiling can provide real peace of mind.

The 2027 rules continue the Part D benefit redesign that began under the Inflation Reduction Act. The old “coverage gap”—often referred to as the “doughnut hole”—is gone. The benefit now moves through three simpler phases: a deductible phase, an initial coverage phase, and a catastrophic phase in which beneficiaries pay nothing more for covered drugs.

Another important feature is the Medicare Prescription Payment Plan, which allows beneficiaries to spread their prescription drug out-of-pocket costs throughout the year rather than paying a large amount at the pharmacy early in the year. This program does not reduce the total cost of prescriptions, but it can make those costs easier to budget. A beneficiary may opt into the program at any time during the year.

Medicare’s Negotiated Drug Prices Expand

One of the biggest developments for 2027 is the expansion of Medicare’s Drug Price Negotiation Program. Negotiated prices for 10 high-cost medications took effect in 2026. Beginning January 1, 2027, negotiated prices will take effect for 15 additional drugs. These include widely used medications such as Ozempic, Rybelsus, Wegovy, Trelegy Ellipta, Breo Ellipta, Linzess and Tradjenta, as well as several expensive cancer medications.

Don’t Assume Your Medicare Advantage Plan Is Staying the Same

People enrolled in Medicare Advantage should pay particularly close attention to their Annual Notice of Change (ANOC) this fall. Your plan must provide its 2027 ANOC by September 30 each year, and reading it is one of the most important things you can do before the Annual Enrollment Period.

Medicare Advantage plans can change premiums, copayments, deductibles, provider networks, prescription formularies, doctor and hospital networks, and supplemental benefits from one year to the next. Benefits such as dental, vision, hearing and over-the-counter allowances may also change.

CMS has finalized payment and regulatory changes for Medicare Advantage plans for 2027, including changes to the Star Ratings system used to evaluate plan quality. CMS projects that overall Medicare Advantage payments to plans will increase by approximately 2.48% in 2027, but that does not mean every plan or beneficiary will see an equivalent increase in benefits.

Part B Costs Are Not Final Yet

As of August 2026, the final Medicare Part B premium and deductible for 2027 have not yet been announced.

For reference, the standard Part B premium is $202.90 per month in 2026, with an annual deductible of $283. Current Medicare projections indicate that Part B costs are likely to rise again in 2027, but beneficiaries should be cautious about relying on estimates until CMS announces the official amounts later this year.

Higher-income beneficiaries should also remember that Medicare premiums can be affected by the Income-Related Monthly Adjustment Amount (IRMAA). In most cases, Medicare uses tax information from two years earlier to determine whether an additional Part B and Part D premium applies.

October 15 Should Be on Your Calendar

Medicare’s Annual Enrollment Period runs from October 15 through December 7, with coverage changes generally taking effect January 1. Final 2027 Medicare Advantage and Part D plan information, including plan offerings and premiums, is expected to be released in September.

When comparing plans, don’t focus solely on the monthly premium. Check whether your physicians and hospitals remain in-network, whether your prescriptions remain on the formulary, what tier each medication occupies, which pharmacies are preferred, and how deductibles and copayments have changed.

The Bottom Line

Medicare is becoming increasingly difficult to evaluate based on premium alone. Prescription drug protections are improving, and negotiated drug prices may provide significant savings for some beneficiaries. At the same time, deductibles and copays are increasing, and Medicare Advantage and Part D plans can change substantially from year to year.

A plan that was a perfect fit this year could change in ways that matter to you next year. That makes it important to review your coverage rather than simply allowing it to renew automatically. Read your Annual Notice of Change, make a list of your doctors and prescriptions, and compare your existing coverage with the 2027 alternatives available in your area.

Navigating Medicare can be complicated. Coverage options may vary based on healthcare needs, prescription medications, income, preferred doctors and hospitals, and personal preferences. Asking the right questions and getting knowledgeable assistance can make the process much easier.

For assistance reviewing your Medicare options, contact Crystal A. Manning, a licensed Medicare advisor with more than 25 years of experience, at 412-716-4942 or crystalmanning33@gmail.com.

Crystal is also pleased to introduce her daughter, Dvonya Sedlacko-Stephens, who can be reached at 412-657-3889 or djsedlacko@gmail.com.