Millions of Medicare Advantage enrollees face difficult decisions as private insurers scale back offerings and prescription drug costs surge following the Trump administration’s elimination of a key subsidy program. Open enrollment runs through December 7, with significant changes affecting coverage options for 2027.
Insurers Cut Medicare Advantage Options
The average Medicare beneficiary can select from just 35 Medicare Advantage plans in 2027, down from 39 plans available in 2026, according to a KFF analysis. About 35 million Americans rely on these privately run Medicare plans, which must follow federal rules while offering additional benefits beyond traditional Medicare. Insurance companies are either reducing their Medicare Advantage footprint or abandoning certain markets entirely, forcing many seniors to search for replacement coverage during the current enrollment period.
The situation grows more complex for prescription drug coverage. Approximately 1 percent of Medicare Advantage beneficiaries will find no prescription drug plan available during general enrollment, affecting residents in 193 counties compared to 123 counties in 2026. This represents a significant expansion of coverage gaps at the county level, leaving vulnerable seniors without essential medication access through their preferred insurance structure.
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Prescription Drug Subsidies Eliminated
Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, ended the Part D Premium Stabilization Demonstration program earlier in 2026, claiming it primarily benefited corporate insurance companies rather than patients. The temporary subsidy program capped prescription drug plan premiums for seniors, providing an average monthly reduction of 26 dollars in 2025 and 16 dollars in 2026, according to Medicare Payment Advisory Commission data.
Timothy McBride, the Bernard Becker Professor in the School of Public Health at Washington University in St. Louis, characterized the subsidy changes as profound with significant effects. About half of Part D recipients will likely face higher prescription costs and increased premiums when the program expires at year’s end, an administration official confirmed to ABC News. Oz maintains that most Medicare recipients will see premium increases no greater than ten dollars, with some potentially experiencing lower costs.
What Seniors Must Consider
The Centers for Medicare and Medicaid Services projects that average prescription drug premiums in Medicare Advantage will drop more than 30 percent for 2027, even as the Trump administration pursues broader drug pricing reforms. However, Juliette Cubanski, vice president and director of the program on Medicare policy at KFF, warns that Part D stand-alone drug plan enrollees could face larger premium increases than recent years. Seniors must evaluate not just monthly premiums but also deductibles and out-of-pocket caps when selecting coverage, as these factors significantly impact total healthcare expenses throughout the year.