Medicare 2026: Rising Part B Costs, Shrinking Part D Plans, and Advantage Changes
Medicare beneficiaries in the United States face several important changes in 2026, affecting costs, coverage options, and plan availability. Medicare Part B premiums are set to increase significantly, with the monthly premium rising to $202.90 from $185 in 2025, marking a 9.7% hike that surpasses the Social Security cost-of-living adjustment for the period. Additionally, the Medicare Part B deductible will also increase to $283 from $257, resulting in higher out-of-pocket expenses before coverage begins. Prescription drug coverage under Medicare Part D will experience a contrasting shift; the average premium is projected to decrease to $34.50 monthly in 2026, compared to $38.31 in 2025. However, many beneficiaries will still see increases, with some plans charging up to $50 more per month. Moreover, the number of available Medicare Part D plans is shrinking, with 360 plans offered nationwide in 2026, down sharply from 464 plans in 2025. This reduction limits choices for beneficiaries, with some regions losing access to zero-premium plans. Experts advise caution against dropping Part D coverage, since re-enrollment penalties can apply, and unexpected medication needs may lead to high costs without coverage. Beneficiaries are encouraged to select the lowest premium plan even if they currently do not take medications. Medicare Advantage plans are also undergoing changes, with some insurers, including UnitedHealthcare, narrowing service areas and discontinuing certain plans. In some states, like Vermont, the market has contracted substantially, leaving fewer options for beneficiaries. When Medicare Advantage plans are canceled, affected enrollees receive special enrollment rights to switch to Medigap plans without underwriting, allowing for potentially more comprehensive coverage despite higher premiums. The tightening Medicare Advantage market may prompt beneficiaries with significant health care needs to consider traditional Medicare with Medigap supplemental insurance, which can reduce out-of-pocket costs. However, those converting will need to maintain separate Medicare Part D plans for drug coverage. Medicare open enrollment from October 15 to December 7 remains a critical period for beneficiaries to review plan changes, compare options, and enroll accordingly. Utilizing tools like the Medicare.gov plan finder can aid in finding appropriate plans. State Health Insurance Assistance Programs (SHIP) provide free, unbiased counseling to assist beneficiaries in navigating these changes. Overall, 2026 presents a landscape of higher costs and more limited coverage choices across Medicare Parts B, D, and Medicare Advantage plans, necessitating proactive planning and evaluation by beneficiaries to manage financial and health care outcomes effectively.