Medicare open enrollment begins with changing plans and possible rises in prescription drug costs

Open enrollment for Medicare, the nationwide United States federal health insurance programme mainly for people aged 65 and older, has begun. Several changes are coming this year, including fewer plans on offer and the possibility of higher prescription drug costs. Open enrollment ends on December 7.

During this period, enrollees can choose between traditional Medicare and Medicare Advantage plans for the coming year. Many enrollees in privately run Medicare Advantage plans may need to find new plans this time, as insurers scale back their offerings.

Medicare Advantage is a Medicare-approved plan run by private insurance companies. The plans must follow rules set by Medicare, such as limiting out-of-pocket expenses and covering all services covered by traditional Medicare. About 35 million people are enrolled in Medicare Advantage.

A KFF analysis shows that the average Medicare beneficiary will be able to choose from among 35 Medicare Advantage plans for 2027, compared with 39 plans in 2026. This indicates that insurers are either scaling back Medicare Advantage plans or removing them completely, and many beneficiaries will need to find new plans for 2027.

A separate KFF analysis earlier this month found that some enrollees will be losing their Medicare Advantage prescription drug plans, which are offered at county level. About 1 percent of Medicare Advantage beneficiaries will have no prescription drug plan available during general enrollment. This includes beneficiaries in 193 counties, up from 123 counties in 2026.

Earlier this year, the Trump administration announced it was ending a key temporary health insurance subsidy programme aimed at capping prescription drug plan premiums for seniors. Medicare Part D — the government health insurance programme's prescription drug benefit — is used by tens of millions of older or disabled beneficiaries.

Dr Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, claimed at the time that the programme, known as the Part D Premium Stabilization Demonstration, benefited corporate insurance companies. The programme's subsidies are set to expire at the end of the year. An administration official told ABC News that the move will likely result in higher prescription costs and increase premiums for about half of recipients.

Juliette Cubanski, vice president and director of the programme on Medicare policy at KFF, said in a statement that without these extra subsidies in place for 2027, some Part D stand-alone drug plan enrollees could face a larger premium increase for drug coverage next year than in recent years, though plan-specific premium amounts are not yet known.

A March 2026 report from the Medicare Payment Advisory Commission found that subsidies provided under the programme reduced the average monthly prescription drug plan premium by $26 in 2025 and $16 in 2026. Timothy McBride, a professor at Washington University in St. Louis's School of Public Health and a health policy analyst, told ABC News that the changes in the subsidies for Medicare Part D are pretty profound and will have a pretty big effect.

In a post on X in July, Dr Oz claimed that most Medicare recipients will not see their premiums go up by more than $10 and some may see even lower premiums. He wrote that every Medicare beneficiary still has access to low-cost plans, and that they will continue to lower prescription drug prices for every American patient.

Other changes coming to Part D include the cap on annual out-of-pocket expenses for Part D drugs. The standard deductible, for example, will increase from $615 to $700. McBride said people need to pay attention not just to the premium, but also to things like the deductible and the caps, because those could significantly affect their out-of-pocket costs.

While the Trump administration vows to lower drug prices for Americans, the Centers for Medicare & Medicaid Services contends that its 2027 prescription drug prices will remain stable and that average prescription drug premiums in Medicare Advantage are projected to fall by more than 30 percent. Enrollees choosing a plan by December 7 will therefore need to weigh premiums, deductibles and coverage together.