CMS Projects 2027 Medicare Advantage Premiums to Drop 16% Despite Enrollment Disputes
The Centers for Medicare & Medicaid Services (CMS) announced that average monthly premiums for Medicare Advantage plans will decrease by 16% to $12 in 2027, while stand-alone Part D prescription drug premiums will rise slightly to $36. Although insurers predict enrollment declines, CMS expects higher participation. Open enrollment runs from October 15 to December 7.
Key points
- Average Medicare Advantage premiums will fall from $14.37 in 2026 to $12 in 2027.
- Stand-alone Part D premiums will increase from $35.09 to $36 in 2027.
- CMS projects 34 million Medicare Advantage enrollees for 2027, contradicting insurer forecasts of lower numbers.
- The Part D Premium Stabilization Program ends on January 1, 2027.
- Open enrollment for 2027 coverage begins on October 15 and ends on December 7.
Background
In August 2026, the Social Security Administration projected a 3.4% cost-of-living adjustment for 2027, noting that the end of the Part D Premium Stabilization Program could raise drug costs. Earlier in September, reports indicated that health insurance bills across ACA and employer plans were set to climb in 2027 due to higher medical costs and the expiration of pandemic subsidies. Additionally, in August, Costco announced plans for a multiyear Medicare partnership with SCAN Health Plan, pending regulatory approval.
How outlets are covering it
CMS and insurers disagree on enrollment trends. CMS projects 34 million Medicare Advantage enrollees for 2027, while insurers forecast a drop from 36.3 million in 2026. Modern Healthcare notes that insurers prioritize profit margins over membership expansion due to high medical costs and lower federal payments. Fierce Healthcare highlights that CMS expects supplemental benefits to remain stable, while USA Today emphasizes that 88% of enrollees can keep their current plans with the same or lower premiums. KFF’s Juliette Cubanski warns that insurers may reduce coverage or increase cost-sharing to maintain low premiums.
Why it matters
Lower premiums for Medicare Advantage plans may improve affordability for millions of older Americans, but potential reductions in drug formularies or increased cost-sharing could affect access to medications. The end of the Part D Premium Stabilization Program may lead to higher costs for stand-alone drug plans, influencing beneficiary decisions during open enrollment.
What to watch
Insurers must notify enrollees of plan changes by September 30. Open enrollment runs from October 15 to December 7 for coverage beginning January 1, 2027. CMS will monitor enrollment trends and plan availability throughout the year.
- Medicare unveils 2027 rates for private Medicare, Part D plans USA Today
- CMS projects Medicare Advantage premiums to decline by 16% in 2027 Fierce Healthcare
- Insurers, CMS clash over 2027 Medicare Advantage outlook Modern Healthcare
- Medicare Unveils 2027 Rates: Premiums Adjust iHeart
- 2027 Medicare Advantage and Part D Rate Announcement South Florida Hospital News
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