Medicare Open Enrollment Brings Fewer Plans, Higher Drug Costs

Medicare's open enrollment period runs through Dec. 7, and the field of available Medicare Advantage plans has gotten smaller while a temporary drug-cost subsidy is set to disappear, according to the Centers for Medicare & Medicaid Services and research from KFF cited by ABC News.

During the enrollment window, beneficiaries choose between traditional Medicare and Medicare Advantage, the privately run alternative that must follow federal rules on out-of-pocket limits and covered services. Roughly 35 million people are enrolled in Medicare Advantage plans, per ABC News.

What's changing for Medicare Advantage enrollees this year?

A KFF analysis found that the average Medicare beneficiary will be able to choose from 35 Medicare Advantage plans for 2027, down from 39 plans in 2026, ABC News reported. The drop signals that insurers are scaling back offerings or pulling out of certain markets entirely, which means many current enrollees will need to pick new coverage for next year rather than simply renew what they have.

A separate KFF analysis, also cited by ABC News, found that some Medicare Advantage enrollees will lose their prescription drug coverage altogether because those plans are offered at the county level. About 1% of Medicare Advantage beneficiaries will have no stand-alone drug plan available to them during general enrollment, the analysis found. That gap now touches 193 counties, up from 123 counties in 2026.

Why are insurers cutting Medicare Advantage plans?

ABC News did not report a single stated reason from insurers for the reductions, but the shrinking plan counts coincide with CMS projections for 2027 pricing. The agency contends that prescription drug prices under Medicare Advantage will hold stable next year and that average prescription drug premiums in the program are projected to fall more than 30%, even as the overall menu of plans narrows.

How will the end of Part D subsidies affect premiums?

Earlier this year, the Trump administration moved to end the Part D Premium Stabilization Demonstration, a temporary subsidy program designed to cap prescription drug plan premiums for seniors enrolled in Medicare Part D, the program's prescription drug benefit used by tens of millions of older and disabled beneficiaries, according to ABC News.

Dr. Mehmet Oz, the CMS administrator, said at the time that the subsidy program had primarily benefited corporate insurance companies, ABC News reported. The subsidies are scheduled to expire at the end of this year.

An administration official told ABC News the change will likely raise prescription costs and increase premiums for about half of Part D recipients. "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," the official said, according to ABC News.

What's the deadline to switch plans?

Open enrollment closes Dec. 7. Beneficiaries who want to compare plans, switch from Medicare Advantage back to traditional Medicare, or shop for a new Part D drug plan before losing current coverage need to act before that date, per ABC News.

Medicare changes by the numbers

• 35 million people are enrolled in Medicare Advantage plans nationwide, per ABC News.
• 35 plans will be available to the average beneficiary in 2027, down from 39 plans in 2026, according to KFF data cited by ABC News.
• 1% of Medicare Advantage beneficiaries will have no stand-alone prescription drug plan available during general enrollment, up to 193 counties affected compared with 123 counties in 2026, per KFF.
• More than 30% — the projected drop in average Medicare Advantage prescription drug premiums for 2027, according to CMS.
• About half of Part D stand-alone drug plan recipients are expected to see premium increases once the temporary subsidy expires, an administration official told ABC News.
• Dec. 7 is the deadline to make changes during this year's open enrollment period.

The practical effect for most beneficiaries, per the reporting, is twofold: a narrower set of Medicare Advantage options to review, and a prescription drug market where premium relief that had been propped up by a temporary federal subsidy is going away. CMS maintains that 2027 drug pricing within Medicare Advantage will remain stable and that the program's average drug premiums are headed lower, even as the subsidy tied specifically to stand-alone Part D plans winds down. Beneficiaries weighing both programs have until Dec. 7 to settle on coverage for next year, according to ABC News.