What changed across Medicare for 2027

Fewer plans on the menu

The first thing to know about 2027 is that the number of Medicare plans has been shrinking. After years of the plan menu growing wider and wider, carriers have started to pull back — trimming plans that didn't attract enough members or cost too much to run. You can already see the trend in the move from 2025 to 2026.

Source: CMS Medicare Advantage and Part D Landscape files. "The average person" figure is the count of MA-PD plans available where a typical beneficiary lives, not the total number of plans in the country.

The sharpest drop is in stand-alone Part D drug plans — the plans people on Original Medicare buy just for their prescriptions. They fell from 474 in 2025 to 367 in 2026, a bit more than one in five gone. Medicare Advantage plans with built-in drug coverage narrowed too, from an average of 34 choices down to 32.

What this means if you're renewing: a smaller menu doesn't automatically mean your plan is gone — most plans still renew year to year. But plan contraction is exactly why the fall check-up matters. When a carrier trims its lineup, your specific plan is more likely to be one of the ones being ended or folded into another plan. If that happens and you don't act, you can be moved automatically into a replacement plan — or, for a terminating drug plan, left without prescription coverage. Fewer plans also means the ones that remain may have adjusted their prices and benefits to absorb members from the plans that went away.

The $2,000 drug cap and the Part D redesign

The biggest structural change to Medicare in years is a hard limit on what you pay for prescription drugs. Under the Inflation Reduction Act, Part D now has a $2,000 annual cap on out-of-pocket drug costs. This cap began in 2025. In plain terms: once your own spending on covered prescriptions reaches $2,000 in a calendar year, you pay nothing more for covered drugs for the rest of that year. There is no longer a "coverage gap" — the old "doughnut hole" — where costs could climb into the thousands.

The change didn't stop there. Part D is being redesigned over several years to make that cap work, and the details keep getting finalized. The CY2027 Final Rule, published in April 2026, finalized changes to the Manufacturer Discount Program for 2027 — the program that sets how much drug makers chip in toward your prescription costs once you reach certain spending points. You don't have to track the machinery. What matters for you is the result: plans have been re-pricing premiums and reworking their drug lists to fit the new rules, so the plan that was a good fit two years ago may look different now.

There's also a payment option worth knowing about. Because of the redesign, you can choose to spread your out-of-pocket drug costs across the year in monthly installments instead of paying a large amount at the pharmacy counter all at once. It doesn't lower your total — it just smooths the timing.

Why premiums and benefits are shifting

Put the two forces together — a narrower plan menu and a redesigned drug benefit with a firm $2,000 ceiling — and you get a year of real movement. When plans have to absorb more of the cost of expensive prescriptions, that pressure has to go somewhere. Plans respond by adjusting three things:

• Premiums and deductibles — the monthly amount you pay and the amount you cover before the plan starts paying. These can rise, fall, or hold steady, and they don't all move in the same direction.
• Formularies — the list of drugs a plan covers, and which "tier" each drug sits on. A medication you take could move to a more expensive tier, need prior approval, or drop off the list entirely.
• Supplemental extras — the dental, vision, and hearing benefits, over-the-counter allowances, and fitness perks that Medicare Advantage plans add on top of basic Medicare. These are often the first things trimmed when a plan is under cost pressure.

None of these show up in the headlines, because they're specific to each plan. A plan can keep the same name and the same premium while quietly dropping the dental coverage you relied on, or raising the copay on a drug you take every month. That's precisely why a year-over-year check of your own plan beats reading about averages. The averages tell you the weather; your plan's Annual Notice of Change tells you what to wear.

How to see YOUR changes

This guide is the map; the next step is checking your own address on it. Every fall, CMS publishes the Landscape and Crosswalk files — the public records of what happens to every Medicare Advantage and Part D plan, including which ones renew, merge, shrink, or end. Our What Changed tool turns those files into a plain-English, side-by-side comparison of your plan's premium, deductible, maximum out-of-pocket, star rating, and extra benefits from one year to the next. No form, no phone number, and no one calls you.