Medicare Plan Changes Drive Busy Open Enrollment

Medicare Advantage deserts are uncommon, coverage robust 

Medicare Advantage plan exits have hit rural areas with small Medicare populations and larger urban areas alike, KFF found. For example, three insurers will no longer offer MA plans with drug coverage in rural Brown, Lake of the Woods, Morrison and Renville counties in Minnesota next year. 

And HealthSpring will no longer offer Medicare Advantage plans with drug coverage in Miami-Dade County, Florida, next year, KFF reports. Likewise, Humana will no longer offer MA plans with drug coverage in Monroe County, New York, in the Rochester area.

“The different decisions of insurers to exit certain counties suggest a combination of factors are at play, including local market characteristics, cost pressures, shifts in firm-level strategies and ultimately the insurers’ assessment of profitability,” according to KFF analysis. 

Still, having no access to an MA plan with drug coverage is uncommon, KFF says.

Among eligible beneficiaries — excluding those in Connecticut — 40 percent, or roughly 25.6 million, have 31 or more Medicare Advantage plans with drug coverage to choose from next year. Forty-nine percent, about 30.8 million, can choose from 11 to 30 plans.

Eleven percent of eligible beneficiaries, about 6.8 million, have one to 10 Medicare Advantage drug plans to choose from next year.

Stand-alone Part D drug plans in transition

The average monthly premium for stand-alone plans will increase by less than $1, from $35.09 in 2026 to $36 in 2027, says the Centers for Medicare & Medicaid Services. 

But for the 83 percent of current stand-alone plan enrollees who don’t receive financial assistance with their drug costs through the federal Extra Help program, the average premium will rise 50 percent from $38.72 this year to $58.20 in 2027, says an analysis by Avalere Health, a health care consulting firm.

Medicare beneficiaries will have an average of nine stand-alone Part D plans to choose from next year. That includes 19 states and Washington, D.C., with a choice of nine stand-alone plans, 15 states with eight plans and eight states with 10 plans.

Changes in the cost and availability of Part D stand-alone plans reflect rising drug prices — including GLP-1s — and the plans’ added costs for a more generous Part D benefit thanks to consumer-friendly provisions of a 2022 prescription drug law that revamped coverage requirements, Wright says. 

And unlike MA plans with drug coverage, stand-alone drug plans — which cover 25.3 million beneficiaries — don’t receive federal rebates that can reduce or eliminate Part D premiums. So, these plans “are just in a more difficult environment,” Wright says.

The loss next year of temporary federal subsidies that helped stand-alone plans lower premiums in 2025 and 2026 didn’t cause across-the-board premium hikes for 2027, Wright says. “But it also didn’t mean that plans just stayed put,” he adds. “They are very selective in where they are and what premiums they’re charging. So it still remains to be seen how this will play out.” 

KFF says the canceled subsidies are “possibly related” to the loss next year of all zero-premium Part D stand-alone plans available to people not enrolled in the Extra Help program. Four million such beneficiaries enrolled in these plans will face higher stand-alone Part D premiums next year, KFF says.

Enrollees currently in zero-premium Part D stand-alone plans should review their plan materials and ensure that they are prepared to start paying their updated premium in January 2027 to avoid potentially being dropped by their plan. 

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