Medicare Cost Hikes Could Hit Seniors Dissatisfied With Their Current Coverage

KEY TAKEAWAYS

• Many retirees who are already unhappy with Medicare should expect higher costs in the coming year.

• A federal subsidy that reduced stand-alone drug plan premiums by an average of $16 per month is ending.

Retirees who are already frustrated with Medicare expenses may be facing even higher bills next year.

In a recent eHealth survey, 42% of Medicare beneficiaries said they were dissatisfied with at least one aspect of their coverage. Premiums were the most common complaint, followed by high out-of-pocket costs.

Many retirees are also dealing with expenses they did not expect. Roughly one-third of Medicare beneficiaries, including Americans age 65 and older as well as younger people with disabilities, told eHealth that their out-of-pocket costs were higher than anticipated.

Why This Matters

Most retirees rely on fixed incomes, usually a combination of Social Security benefits and withdrawals from retirement savings. While Social Security benefits will increase 3.6%, Medicare costs are rising faster than those checks.

Rising Medicare Part B premiums have added to the pressure. In 2026, the standard Part B premium rose by $17.90 to $202.90, the second-largest dollar increase in the program’s history. The 2027 premium has not yet been announced, but the Medicare trustees project it will reach $209.50.

To help offset Part B costs, the Trump administration sent one-time $90 payments to about 20.8 million Original Medicare enrollees. Medicare Advantage members, people whose premiums are paid by Medicaid, and higher earners subject to income-related surcharges were not eligible.

As a result, dissatisfaction with Medicare expenses has climbed. A 2026 survey by The Senior Citizens League, a nonpartisan advocacy group for older Americans, found that 41% of seniors were unhappy with what Medicare costs them, up 10 percentage points from the previous year.

At the same time, self-reported health spending has eased. In the 2025 survey, the median senior said they spent between $401 and $600 per month on healthcare over the previous year; in the latest survey, that figure fell to between $201 and $400.

Still, the survey was fielded early in the year, and TSCL said the drop in healthcare costs and improvement in satisfaction may reflect a lower cap on out-of-pocket prescription drug spending. Medicare Part D first set a hard out-of-pocket drug cap of $2,000 in 2025; it rose to $2,100 in 2026 and will increase to $2,400 in 2027.

Another factor may also be influencing the results. In February, TSCL said a survey showed that 58% of seniors had skipped care to save money, including dental, vision, and hearing services.

The Trump administration is ending a subsidy that had lowered stand-alone Part D premiums by an average of $16 a month in 2026. CMS says the average stand-alone premium is expected to rise by less than $1, to $36 a month, but no zero-premium stand-alone plans will be available in 2027. That change affects about 4 million enrollees who paid nothing in 2026, and some plans, including UnitedHealth’s AARP-branded plans, could see monthly increases of $50 or more for people who do not switch.

In addition, the Part D out-of-pocket cap is increasing by $300 to $2,400, and the maximum deductible will rise by $85 to $700. The 56% of Part D enrollees who receive drug coverage through Medicare Advantage are not affected by the end of the subsidy, and their average drug premium is projected to fall to $7.

Overall, Medicare Part D premiums are expected to rise as government premium-stabilization subsidies end. Beneficiaries will likely pay about $16 more each month, or nearly $200 more a year, for drug coverage.

“In general, any increase in out-of-pocket costs could lower satisfaction levels, regardless of what type of Medicare coverage a person has,” Whitney Stidom, vice president of consumer enablement at eHealth, said in an email.

She recommended that Medicare Advantage and Part D enrollees review the annual notice-of-change letters they received and compare the plans available in their area before open enrollment ends.