Savvy Senior: Ways to Cut Medicare Costs in 2027

I’m on Medicare. What changes are coming in 2027, and how can I make sure I’m not paying too much for my coverage?

– Careful Shopper

Dear Careful,

If you have Medicare, this is a good time to make sure you’re getting the most value for your money. Open enrollment gives you a chance to change Medicare Advantage or prescription drug plans for 2027. Because costs, drug coverage and extra benefits can shift from one year to the next, reviewing your choices now could save you money and frustration later.

Even if you like your current plan, don’t assume next year will look the same. Here’s what to watch.

Prescription drug changes

Medicare Part D prescription drug plans are changing, and some people could end up paying more. In 2027, the maximum annual deductible will rise from $615 to $700, and the yearly out-of-pocket limit for covered Part D medications will increase from $2,100 to $2,400. That cap helps shield people who rely on costly medications. Average premiums for stand-alone Part D plans are expected to go up by less than $1 a month, but actual plan costs can vary widely. A temporary federal program that helped hold down premiums is also ending, which makes comparison shopping especially important.

Your insurer may also revise its formulary, or list of covered drugs, or move a medication to a more expensive tier. Make sure your prescriptions are still covered and find out what you’ll pay for them.

Medicare Advantage changes

If you have Medicare Advantage, the private-insurance alternative to Original Medicare, review your plan closely. Some insurers are dropping plans or leaving certain markets, while others may adjust costs or reduce extra benefits such as dental, vision and hearing coverage.

Doctor, specialist and hospital networks can change as well. If your plan is being discontinued, you’ll need to pick new coverage. Even if it remains available, compare next year’s costs, benefits and provider networks before you automatically renew.

Help with weight-loss drugs

A new Medicare GLP-1 Bridge program offers eligible beneficiaries certain medications for weight management for $50 a month through the end of 2027. Covered drugs include Wegovy, Zepbound (KwikPen only) and Foundayo. Eligibility is limited. For example, you generally need Medicare drug coverage and must meet specific body mass index and health requirements. The program works separately from regular Part D coverage, so the $50 monthly payment does not count toward your Part D deductible or annual out-of-pocket limit. Learn more and check eligibility at Medicare.gov/coverage/weight-loss-drugs.

How to shop smart

Here are four ways to find coverage that matches your needs without overpaying:

Read your plan notice: Your insurer should send an Annual Notice of Change that explains next year’s premiums, deductibles, copayments and coverage changes. Medicare Advantage members should also review provider networks and extra benefits.

Compare total costs: Visit Medicare.gov/plan-compare. Enter your medications and preferred pharmacies to compare plans and estimate annual costs. Don’t focus on premiums alone; include deductibles and prescription costs.

Check your doctors: If you’re considering Medicare Advantage, contact your doctors and hospitals directly to confirm they’ll accept the specific plan in 2027. Online directories can be outdated.

Get free help: Your State Health Insurance Assistance Program, or SHIP, offers free and unbiased Medicare counseling. Find a local counselor at ShipHelp.org or call 877-839-2675.

One important caution: If you’re thinking about switching from Medicare Advantage to Original Medicare, check your Medigap options first. In most states, insurers can deny you a Medigap policy or charge higher premiums based on your health history if you don’t qualify for guaranteed-issue protections. Make sure you understand your choices before leaving your current plan.

Take the time to compare plans before open enrollment ends. A little research now could save you money and help you start the new year with better coverage.