2027 Medicare Changes Raise Drug Costs and Alter Plan Options for Seniors

Medicare’s annual open enrollment, running from Oct. 15 to Dec. 7, brings three major shifts for 2027. First, the Part D out-of-pocket threshold climbs from $2,100 to $2,400 and the standard deductible rises to $700, meaning higher spending before the cap is reached. Second, the Centers for Medicare & Medicaid Services will end the Part D Premium Stabilization Demonstration, moving insurers back to traditional market conditions and allowing plan-specific premium changes.

Third, the program will start negotiating prices for fifteen additional high-cost drugs such as Ozempic, Wegovy, and several respiratory and oncology treatments, which CMS expects to shave roughly $685 million off beneficiaries’ costs. Meanwhile, some Medicare Advantage carriers are pulling plans from certain locales and scaling back benefits like dental coverage. With a 3.6 % Social Security cost-of-living adjustment slated for 2027, many seniors may see the increase eroded by rising health expenses, making careful plan comparison essential before the new coverage takes effect on Jan. 1.