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Medicare Plan Pullbacks, Cost Changes Complicate Open Enrollment for Millions

Medicare Advantage, stand-alone Part D drug plan moves heighten need to review, compare or switch coverage during sign-up period

5-minute read

Tony Pugh,

AARP

Published October 30, 2026

Graphic illustration of an older woman considering healthcare options from an open medicine cabinet.

Beth Goody

Key takeaways

Report: 7.8 million face Medicare coverage disruptions for 2027.
AARP: Carefully review your options during open enrollment period.
Stressed Part D, Medicare Advantage markets spur retools, changes.
Medicare Advantage deserts uncommon, coverage availability robust.
Stand-alone Part D prescription drug plans are in transition.

Medicare open enrollment for 2027 will be more challenging for millions of beneficiaries who face rising premiums , discontinued Medicare Advantage and Part D plans, or who live in areas their plans will no longer serve.

From Oct. 15 to Dec. 7, Medicare beneficiaries can switch from original Medicare to Medicare Advantage or vice versa; change from one Medicare Advantage plan to another; or join, drop or switch to a stand-alone Part D prescription drug plan used by beneficiaries in original Medicare. Unlike original Medicare, Medicare Advantage plans and stand-alone Part D drug plans are offered by commercial insurers.

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But higher costs and involuntary coverage disruptions can add an extra layer of stress to the annual Medicare sign-up period, which many already find confusing and overwhelming.

7.8 million face involuntary coverage interruptions

An estimated 4.4 million people in Medicare Advantage plans with drug coverage must find new coverage next year because their current plans were discontinued, according to an analysis of federal data by DUOS, a health technology company. Another 800,000 are seeking new coverage because their MA plans with drug coverage will no longer serve the counties where they live.

And nearly 2.6 million stand-alone Part D drug plan enrollees face the same problem: Their current plans have either been terminated for next year or won’t be available where they live, says Jenn Kerfoot, president and chief operating officer of DUOS, which helps Medicare enrollees navigate benefits and care. About 961,000 of these beneficiaries — 40 percent — are enrolled in Aetna Medicare SilverScript Choice plans in 13 coverage regions where the plans will no longer be offered next year, Kerfoot says.

Of the combined 7.8 million beneficiaries who faceing coverage disruptions at the end of 2026, at least 4.3 million, or 55 percent, will have to get new coverage from another insurer, according to Kerfoot. A separate analysis by KFF , a nonprofit health care research organization, found similar numbers of beneficiaries affected by MA and Part D plan terminations and exits from local markets.

While these kinds of coverage disruptions are not the norm for most beneficiaries, they do encompass 11 percent of Medicare’s 70.6 million enrollees. And for those affected, it adds urgency to the Medicare open enrollment period, which has historically been underutilized. In fact, nearly 2 out of 3 beneficiaries didn’t compare coverage during open enrollment for 2025 coverage, according to KFF.

And 33 percent of older adults spent less than an hour choosing Medicare coverage during last year’s open enrollment for 2026 coverage, says a new survey of beneficiaries by the University of Michigan. Twenty-seven percent didn’t take any time to review their options. Overall, 80 percent of survey participants kept their coverage from the previous year, the survey found.

AARP urges careful review of options during open enrollment

That approach to open enrollment can be problematic. Because in addition to Part D and Medicare Advantage plans leaving coverage areas and discontinuing plans, significant details, like drug formularies, premiums and provider networks can change from year to year, says Cristina Boccuti, vice president of health security at AARP’s Public Policy Institute.

“Along with checking that their plan is still available, it’s important for Medicare enrollees to review and compare all their options now, during the open enrollment period, to find the coverage that best fits their needs next year,” Boccuti says. “This could mean switching to original Medicare, changing drug plans or finding a different Medicare Advantage plan.”

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Enrollees in discontinued MA plans and plans that have who exited local coverage areas “must proactively enroll in another Medicare Advantage plan if one is available in their area,” or they’ll be switched automatically to original Medicare, according to KFF.

The following resources can help when making open enrollment decisions:

State Health Insurance Assistance Programs (SHIPs) are available in each state. Their trained counselors provide one-on-one assistance with your questions during open enrollment season. They can also tell you about state-specific rules and help you figure out whether you are eligible for financial help with premiums and out-of-pocket costs.
The Medicare Plan Finder compares all Part D and Medicare Advantage plans in your area. And it lists some MA plans’ in-network providers. You can also call 800-MEDICARE (800-633-4227) for assistance or use its live chat tool 24 hours a day, seven days a week, except for some federal holidays.

Medicare Advantage plans now cover 36.2 million people, or 51 percent of eligible beneficiaries. And roughly 89 percent of MA plans also cover prescription drugs, KFF says.

The average beneficiary can choose from 28 Medicare Advantage plans with drug coverage in 2027, down from 32 in 2026, according to KFF. For MA plans with and without drug coverage, the average beneficiary has 35 plans to choose from next year. That’s down from 39 in 2026.

The number of stand-alone Part D plans available in the U.S. will also fall from 360 this year to 316 next year, according to a KFF analysis. For the fourth straight year, the average beneficiary will have fewer stand-alone plans to choose from: nine in 2027, down from 11 in 2026.

Medicare Advantage, Part D insurers adjust coverage offerings

Annual changes in the number and type of plan offerings are not unusual. But several factors help explain what’s happening with MA and stand-alone Part D plans in recent years, says Duane Wright, a senior health care analyst at Bloomberg Intelligence, an independent research division of Bloomberg L.P.

Medicare Advantage plans are facing increased costs due to greater use of health services following the Covid-19 pandemic, changes in plan reimbursements by the federal government and increased use of costly GLP-1s, Wright says. All “have resulted in MA plans being more selective about where they offer coverage,” he adds.

Meredith Freed, a senior policy manager with KFF’s Program on Medicare Policy, said insurers are being “more strategic about their plan offerings, really assessing profitability of plans.”

In previous years, MA insurers in some areas “were offering 10 different plans in a county. So we’re seeing a pullback from some of that,” Freed says.

Next year, 638,000 beneficiaries won’t have any general enrollment Medicare Advantage plans with drug coverage to choose from, according to KFF. These beneficiaries — 239,000 more than in 2026 — are spread out over 193 counties across 16 states and U.S. territories, KFF says. They comprise about 1 percent of eligible Medicare beneficiaries with Part A and Part B coverage.

Many of the 239,000 who will lose access to Medicare Advantage with drug coverage next year will likely enroll in original Medicare for 2027, Freed says. Those who do will not face medical underwriting if they also enroll in a Medigap plan, which helps pay out-of-pocket costs in original Medicare, she adds.

This special “guaranteed issue” protection for Medigap coverage applies to all beneficiaries whose MA plan is involuntarily terminated — even if they have another MA option in their county, Freed says.

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 Health Care Service Corporation 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.

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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Tony Pugh is an award-winning writer and editor covering Medicare for AARP. He has also covered Medicare for Bloomberg Law and as a national correspondent for Knight Ridder/McClatchy Newspapers.

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