Tara Saltzburg, Care Compass Owner & Licensed Insurance Broker Specializing in Medicare

As an independent Medicare broker and owner of Care Compass, I stay closely connected to the latest industry changes and regulations. While no one can predict the future with certainty, my goal is to keep you informed so you can feel confident making decisions about your health and benefits heading into next year.

As we approach 2026, changes are coming to Medicare that will directly impact enrollees’ coverage, costs, and plan options. These shifts are largely driven by rising healthcare utilization and costs, particularly within the Medicare Advantage program, where the demand for care is now exceeding the federal reimbursement levels provided to insurers. At the same time, the continued impact of the Inflation Reduction Act (IRA) is reshaping how prescription drugs are priced and how much beneficiaries pay out of pocket, with phased-in reforms that are forcing plans to restructure their benefits and pricing models.

We're also seeing demographic changes across the Medicare population as more beneficiaries are entering the program with higher rates of chronic conditions and greater healthcare needs, which increases the average cost of care across the board. These and other systemic pressures are forcing plans to tighten formularies, adjust drug tiers, increase cost-sharing, and in many cases, terminate or consolidate plan offerings altogether.

It's critical to understand how these changes may affect you and what steps you can take now to protect your coverage and control your costs. Based on what I’m seeing and tracking in the market, here’s what I anticipate for 2026 and how these changes may affect Medicare beneficiaries.

What Medicare Enrolls Can Expect in 2026

Part B Premium and Deductible Increases

Expect another increase in both the Medicare Part B monthly premium and Part B deductible in 2026.

For 2025, the standard Part B premium is $185 per month. While the official 2026 amounts have not yet been finalized, current projections show the standard premium rising by 11.6% (an additional $21.50), bringing it to $206.50. The annual Part B deductible is also expected to increase by about 12%, moving from $257 to $288.

It’s important for beneficiaries to anticipate higher baseline costs before adding in the expenses of supplemental or Medicare Advantage coverage.

Plan Premium Increases and Shrinking Perks

Premiums are likely to rise for both standalone Part D Prescription Drug Plans (PDPs) and Medicare Advantage plans with prescription drug coverage (MAPDs). The Inflation Reduction Act (IRA) has shifted more of the responsibility for high-cost prescriptions back onto insurance carriers. In the past, Medicare has absorbed much of the cost of these medications, but under the new rules, insurers now shoulder a much larger share of the financial responsibility.

At the same time, overall health care expenses are rising, and utilization of services within the Medicare Advantage program is outpacing the federal reimbursement that plans receive. This combination will drive insurers to adjust their pricing models and reduce some “perks” on Medicare Advantage plans in order to remain financially solvent. This may include carriers scaling back on dental, vision, fitness, and OTC allowances.

Increased Rx Cap

Starting in 2025, the Inflation Reduction Act (IRA) required Medicare Part D plans to cap annual out-of-pocket costs for prescription drugs at $2,000. In other words, once you spend $2,000 on covered medications in the calendar year, you will not pay any additional copayments or coinsurance for the rest of the year. This limit applies only to prescription drug costs and does not include your monthly plan premiums. In 2026, the cap will rise slightly to $2,100.

Fewer Plan Choices

I expect that we will see fewer plan choices on both standalone Prescription Drug Plans as well as Medicare Advantage Plans. Many insurers are likely to terminate or consolidate plans as they adjust to manage financial risk and respond to the new regulations introduced by the Inflation Reduction Act in 2025. Last year was essentially a “test year,” as plans implemented the major IRA requirements for the first time. Now that insurers have real-world data on how these changes affect costs and utilization, it’s likely that plans will be redesigned or discontinued as companies refine their strategies.

If your current plan is ending, you may be automatically reassigned to a new plan, but this does not guarantee the same coverage, benefits, or provider network that you currently rely on. In some cases, plans may be significantly modified or eliminated entirely, making it more important than ever to review your options carefully during the Annual Enrollment Period to ensure your coverage continues to meet your needs.

Rising Rx Costs and Tightened Formularies

I anticipate continued changes in how Medicare Part D plans structure prescription drug costs:

Higher Rx deductible: The maximum prescription drug deductible was $590 in 2025 and will rise to $610 in 2026. This deductible often applies to medications listed as Tier 3 and above, although some plans may not have a drug deductible at all. If your plan does have a deductible, the highest deductible amount you could pay in 2026 is $610.
Shift from copays to coinsurance for higher-tiered medications: Many plans will continue to shift higher-tiered medications away from flat copays and toward coinsurance, where enrollees pay a percentage of the drug’s price. This often leads to higher out-of-pocket expenses, especially for brand-name medications without generic alternatives.
Drug tier changes: Some medications may be moved into higher-cost tiers, resulting in higher copays or coinsurance. We may also see a trend toward adding copays for lower-cost medications, including those typically listed as Tier 1 or 2, which could increase out-of-pocket expenses even for commonly used generic drugs.

Continued Shift in Hospital Cost-Sharing on Medicare Advantage Plans

One of the emerging trends in Medicare Advantage hospital cost‐sharing is a shift from flat copayments for an entire inpatient stay toward a per day copayment. Under the per stay model, a beneficiary might owe a fixed amount regardless of how long the hospital stay lasts; under a per day model, the beneficiary pays a set copayment for each day they are in the hospital. I fully expect this trend to continue in 2026 with more carriers adopting per day copayments as hospital utilization rises and plans look to better align enrollee cost-sharing with the actual length and cost of inpatient stays. This shift reflects the reality that Medicare Advantage now represents a growing share of hospital use. In 2023, 50% of all Medicare inpatient hospital days were attributed to Medicare Advantage enrollees. As hospital utilization among MA enrollees continues to rise, insurers are restructuring cost-sharing to spread financial risk, which means more beneficiaries are seeing per day copays that increase with the length of their stay, rather than a single fixed amount. I anticipate this trend being the new norm moving forward (which is why I’m such an advocate of Hospital Indemnity Plans!).

How You Can Prepare for 2026

These upcoming changes to Medicare in 2026 are important to understand, as they could affect your coverage, costs, and access to care. Staying informed now can help you avoid surprises and make the best choices for your health and budget.

✅ Plan ahead for Part B and supplemental costs: With projected increases in the Part B premium and deductible, make sure you are preparing your 2026 budget accordingly and accounting for higher baseline costs.

✅ Review your Annual Notice of Change (ANOC): You will receive an ANOC from your insurance carrier toward the end of September. Check whether your plan is being modified, consolidated, or discontinued for 2026. Pay close attention to any changes in premiums, deductibles, copays, coinsurance, and the provider network. If everything looks okay, no action is needed; your enrollment will automatically roll over to the next year.

✅ Assess your prescription needs: Review your medications and note any changes to drug tiers, copays, or coinsurance. This can help you determine whether your current plan still provides the most cost-effective coverage for your prescriptions.

✅ Schedule a Medicare Review with a Licensed Broker: If you feel that your current plan may no longer be the best fit after reviewing your ANOC, contact your trusted Medicare broker to schedule an appointment during the Annual Enrollment Period which runs from October 15th-December 7th. If you don’t have a trusted broker, reach out to Care Compass today!

For more, check out 8 Tips to Help You Navigate Medicare’s Open Enrollment Period.

Summary

2026 is shaping up to be a year of meaningful change for Medicare enrollees. Between rising Part B and Part D costs, tighter formularies, shifting drug tiers, and fewer plan options, it’s clear that staying informed and reviewing your coverage now will be critical. By taking the time to understand your options and plan ahead, you can protect your coverage, manage your out-of-pocket costs, and ensure that you continue to have access to the care and medications you need. If you need assistance evaluating your plans during this year’s Annual Enrollment Period, schedule a consultation with Tara today! Remember, there’s no cost when you work with us!

Care Compass is an independent insurance agency that helps seniors navigate the complexities of Medicare and other Senior Products. Our services are offered at NO COST! Care Compass is proudly owned and operated in Blair County, Pennsylvania. We provide Medicare insurance assistance to the residents of Altoona, Hollidaysburg, Duncansville and the surrounding region. If you need assistance with Medicare, contact Care Compass today!

Tara’s Medicare Outlook: What’s on the Horizon for 2026