Millions of Seniors May Lose Medicare Drug Coverage If They Ignore Plan Termination Notices

Nearly 3.2 million Medicare Advantage enrollees, or almost 11% of all members, will need to choose new coverage for 2027 after insurers stopped offering their plans, according to a Medicare Market Insights review of federal data reported by CNN. More than 1 million people enrolled in stand-alone Part D drug plans are also losing coverage, consulting firm Oliver Wyman said. With open enrollment nearing its close, one of the most expensive mistakes many households can make is the simplest one: taking no action.

If a Medicare Advantage plan ends and the member does nothing, the person is usually shifted to Original Medicare on Jan. 1. That preserves hospital and doctor coverage, but prescription drug benefits are not included unless the person signs up for a separate Part D plan. For someone who depends on insulin or a blood thinner, the problem may not become obvious until a pharmacy visit in early January.

Insurers send termination notices, often called nonrenewal letters, before open enrollment starts. Adult children and caregivers who help manage an older relative's mail are often the first to notice them.

A Third Year in a Row of Plan Losses

About 2.9 million people lost plans for 2026 and roughly 2 million lost plans for 2025, far above the 1% to 2% who typically lost coverage in earlier years, said Jared Strock, founder of Medicare Market Insights. Humana, UnitedHealthcare, Aetna and several Blue Cross Blue Shield carriers are among the insurers cutting plans or exiting certain areas, and many of the canceled plans are preferred provider organization, or PPO, policies.

Rural communities are being hit especially hard. A KFF analysis found that about 638,000 beneficiaries in 193 counties will have no Medicare Advantage drug plan available for general enrollment in 2027, up from 399,000 people in 123 counties this year. Aetna is also leaving the stand-alone Part D market in about half of states, Oliver Wyman said.

MedicalDaily previously reported that members affected by plan exits should review doctor networks before open enrollment begins. Since then, the scale of the cancellations has become clearer, and the time left to respond has narrowed to about six weeks.

Why Missing the Deadline Can Leave a Drug Coverage Gap

People whose plans are ending do have extra time to make a change. They can switch during open enrollment or use a special enrollment period that runs from Dec. 8 through the last day of February, according to the Washington state insurance commissioner's office. But a new plan usually begins on the first day of the month after the switch, so waiting until January can mean weeks of paying full price for prescriptions.

A longer gap can be costly. Medicare may add a late enrollment penalty to a Part D premium if someone goes 63 days or more in a row without Part D or other creditable drug coverage, and the surcharge generally lasts as long as the person keeps Part D. People who receive Extra Help are exempt from the penalty.

Even those who act may still face higher costs. No stand-alone Part D plan will offer a $0 premium for people without low-income assistance in 2027, the standard deductible will rise from $615 to $700, and the annual out-of-pocket cap will increase from $2,100 to $2,400, Straight Arrow News reported, citing KFF.

Timothy McBride, a health policy analyst and professor at Washington University in St. Louis, said enrollees should consider "not just the premium, but also things like the deductible and the caps," he told ABC News. Mary Beth Donahue, CEO of the Better Medicare Alliance, said in a statement to CNN, "Seniors shouldn't have to face this disruption every year."

Those most at risk include people who take several medications or costly prescriptions, rural residents with fewer replacement options, and older adults who live alone or struggle with memory issues. Former PPO members may also encounter narrower doctor networks in a new plan.

What to Do Before Open Enrollment Ends

First, locate the termination letter and keep it as proof that the plan is ending. Then make a list of every prescription, dose, pharmacy and regular doctor.

Compare plans through Medicare.gov's Plan Finder or by calling 1-800-MEDICARE. Free counseling is also available through each state's State Health Insurance Assistance Program, or SHIP, and people with limited income should ask about Extra Help.

If someone runs short of an essential medication during a coverage change, they should contact the prescriber or pharmacist instead of skipping doses. Be cautious about unsolicited calls: Medicare will not unexpectedly phone people to ask for a Medicare number.

Coverage selected during open enrollment begins Jan. 1, and people already enrolled in a Medicare Advantage plan can make one change from Jan. 1 to March 31. CMS has not yet released its overview of supplemental benefits for 2027, including dental and hearing coverage.

A brief review with a family member or SHIP counselor before open enrollment ends is the easiest way to avoid starting 2027 without drug coverage.

Key Questions Answered

What happens if my Medicare Advantage plan ends and I do nothing? You are generally moved to Original Medicare on Jan. 1, and you will not have Part D drug coverage unless you enroll in a drug plan.

How many people are losing their plans for 2027? About 3.2 million Medicare Advantage members and more than 1 million stand-alone Part D members.

What is the deadline to choose a new plan? Open enrollment ends Dec. 7. People whose plans are ending also have a special enrollment period that runs through the end of February 2027.

Is there a penalty for going without drug coverage? Medicare may charge a late enrollment penalty after 63 or more consecutive days without creditable drug coverage. People who receive Extra Help do not pay it.

Where can seniors get free help? Call 1-800-MEDICARE, use Medicare.gov's Plan Finder, or contact your state's SHIP program.