Medicare Part D 2027: Premiums Are Set to Rise — Here’s What Changed
Medicare Part D 2027 is shaping up differently than recent years. If you’re on a standalone Part D drug plan, there’s a real change coming worth knowing about before Open Enrollment starts this fall.
In late July 2026, the Centers for Medicare and Medicaid Services ended a program called the Part D Premium Stabilization Demonstration. That subsidy has been quietly keeping drug plan premiums low since 2025, holding the average monthly cost under $40. Without it, one federal watchdog report estimated premiums would have climbed from around $43 to about $81 a month. Now that the subsidy is gone, most experts expect standalone Part D premiums to go up for a lot of people in the new plan year — though nobody can say by exactly how much yet, since plan-specific pricing hasn’t been released.
I want to be upfront: I don’t sell standalone Part D plans, so this isn’t a pitch. But I talk to a lot of people every year who assume their Medicare coverage just renews itself the same way, year after year, and this is exactly the kind of change that makes assuming a bad idea.
What Actually Happens Next
Your Part D carrier will send you an Annual Notice of Change (ANOC) this fall. That letter spells out exactly what’s changing about your specific plan — premium, deductible, drug formulary, all of it. Don’t let it sit in a pile of mail.
Then you’ve got a real window to act. Medicare Open Enrollment runs October 15 through December 7. That’s your chance to compare Part D plans, switch if your current one got more expensive, or just confirm what you have still makes sense heading into Medicare Part D 2027.
While You’re Looking, Look at the Whole Picture
Medicare Part D 2027 pricing changes are a good excuse to actually sit down and look at your full Medicare setup, not just the drug plan. That includes your Medicare Supplement coverage — is it still the right fit, still priced competitively, still covering what you need? A lot of people haven’t checked in years.
If you want a second set of eyes on any of it — your Part D options, your Supplement plan, or just want someone to walk through what Open Enrollment actually means for your situation — give me a call or visit the website. No pressure, no call center, just a real conversation about what makes sense for you.
Here’s something most people don’t realize: you can switch Medicare Supplement plans in Arizona almost any month of the year — you’re not locked in. But “you can apply” and “you’ll get approved at a good rate” are two very different things, and the difference comes down to timing and your health. Let me walk you through how it actually works, because the rules aren’t what most people assume.
You Can Switch Medicare Supplement Plans in Arizona Anytime
Unlike Medicare Advantage, which locks you into set enrollment periods, Medigap plans have no annual “open enrollment” for switching. You can submit an application to change carriers or plans in January, July, or any month you like.
The catch is that outside of your protected windows, switching usually means going through medical underwriting — the insurance company reviews your health history and can charge you more, add exclusions, or decline you outright.
The One Window Where Health Doesn’t Matter
There’s a golden period when you can buy or switch to almost any Medigap plan with no medical underwriting at all: your Medigap Open Enrollment Period. This is the six-month window that starts the month you’re 65 or older and enrolled in Medicare Part B. During those six months, carriers must sell you a policy at their best rate regardless of your health.
If you’re in that window right now, this is the single best time to get the coverage you want. Miss it, and the rules change — which is exactly why timing matters so much.
Guaranteed Issue Rights: Switching Without Underwriting
Even outside that first six months, certain life events give you guaranteed issue rights — the right to buy specific Medigap plans without underwriting. These situations include:
Losing employer or group coverage — when the employer-sponsored, COBRA, or retiree coverage that pays after Medicare comes to an end.
Your Medicare Advantage plan leaving — if your MA plan discontinues in your area, shrinks its service area, or its contract terminates.
Trial rights — if you tried Medicare Advantage when you first became eligible (or dropped a Medigap policy to try MA) and switch back to Original Medicare within 12 months.
Your Medigap carrier failing — if your insurer goes bankrupt, ends coverage through no fault of yours, or misled you.
Moving out of your plan’s service area — for an MA or Medicare SELECT plan.
This is where a lot of Arizona retirees — and younger beneficiaries — leave money on the table. They assume they’re stuck, when a recent change in their situation actually opened a no-underwriting door. But that door closes fast: you generally have no more than 63 days after your prior coverage ends to use a guaranteed-issue right. In many cases you can even apply up to 60 days before the coverage ends, so acting early is smart.
One important note for Arizona specifically: unlike some states, Arizona does not offer an additional guaranteed-issue protection for under-65 Medicare beneficiaries who qualify by disability. If that’s your situation, it’s worth a call before you assume a switch is straightforward — your options and timing will look different, and I can walk you through what’s actually available.
Why People Switch in the First Place
The most common reason isn’t dissatisfaction with coverage — since all Medigap plans of the same letter are standardized by law, a Plan G from one carrier covers exactly what a Plan G from another does. The real driver is price. Carriers raise rates over time, and the company that was cheapest when you enrolled may not be cheapest three years later.
Because the benefits are identical, moving to a lower-priced carrier for the same plan letter is often pure savings — you keep the exact coverage and pay less for it.
What Switching Actually Involves
The process is more straightforward than people fear:
You apply with the new carrier and go through underwriting (unless you’re in a protected window).
You don’t cancel your old policy until the new one is approved and active — never leave yourself with a gap.
Once the new plan is confirmed, you cancel the old one, and you’re done.
The mistake I see most often is people canceling first out of eagerness, then getting declined by the new carrier and scrambling. Approval first, always.
How I Help Arizona Clients Decide
This is exactly the kind of situation where an independent broker earns their keep. I’m contracted with multiple carriers across Arizona, so I can check whether a switch actually saves you money for the same standardized coverage — and whether your timing puts you in a protected window or means underwriting. There’s no cost to you, and I never push a switch that doesn’t benefit you.
If you’re wondering whether you’re overpaying, or whether a recent life change opened a no-underwriting window, it’s worth a quick conversation before that window closes.
If you buy your own health insurance in Arizona, one question matters more than almost any other: do you qualify for an ACA subsidy? The answer decides whether a plan costs you a few hundred dollars a month or almost nothing — and a lot of people leave real money on the table because they assume they earn too much, or too little, to qualify. Let me clear up how it actually works.
What an ACA Subsidy in Arizona Actually Is
The subsidy — officially the premium tax credit — is money the federal government applies directly to your monthly health insurance premium when you buy a plan through the Marketplace. It lowers what you pay out of pocket each month. The amount depends mostly on your household income and household size, measured against the federal poverty level.
Here’s the part people miss: it’s not a rebate you wait for at tax time. It’s applied up front, every month, so your premium is lower from day one.
Eligibility hinges on your estimated annual household income for the coverage year, your family size, and whether you have access to affordable coverage elsewhere (like an employer plan). Because it’s based on estimated income, self-employed people and those with variable earnings have real flexibility — and real reason to get the estimate right.
Who Qualifies — and the Myth That Costs People Money
The Two Ways People Get It Wrong
I see two mistakes constantly. First, people overestimate their income out of caution and miss subsidies they’d have qualified for. Second, they underestimate and owe money back at tax time. Getting the income estimate accurate is where a broker earns their keep — it’s the difference between a pleasant surprise and an unpleasant one.
How the 2026 Rules Affect What You Pay
The enhanced premium tax credits that had removed the income cap expired at the end of 2025. For 2026, the subsidy cliff is back: the credit slides on a sliding scale up to 400% of the federal poverty level, then stops completely. That cutoff works out to roughly $62,600 for a single person and $128,600 for a family of four — earn a dollar over and the credit drops to zero. The safest move is to have your actual numbers run against this year’s brackets rather than relying on last year’s assumptions or a general rule of thumb.
Arizona Uses the Federal Marketplace
Arizona doesn’t run its own state exchange — residents enroll through the federal Marketplace at Healthcare.gov. That means the same federal subsidy rules apply here as in most states, but the plans available, their networks, and their prices are specific to Arizona and even to your county.
Two things worth knowing if you’re shopping for 2026 or 2027 coverage in Arizona specifically: Aetna exited the state’s individual market and Blue Cross Blue Shield of Arizona dropped its PPO products, which means every on-exchange plan for 2026 is HMO only — if you want PPO flexibility, you’ll need to look off-exchange. And Cigna announced in April 2026 that it’s leaving the ACA Marketplace nationwide, including Arizona, starting with the 2027 plan year. If you’re currently on a Cigna Marketplace plan, your coverage ends December 31, 2026, and you’ll need to pick a new plan for January 1.
When You Can Enroll
Most people enroll during the annual Open Enrollment Period. But if you’ve had a qualifying life event — losing other coverage, moving, marriage, a new baby, a change in income — you may qualify for a Special Enrollment Period and can enroll outside that window. Don’t assume you’ve missed your chance; it’s worth checking.
How I Help Arizona Families Get This Right
This is exactly where an independent broker saves you money and headaches. I’ll run your actual household numbers against the current subsidy brackets, show you what you truly qualify for, and compare the Arizona plans available in your county — not a generic quote. There’s no cost to you, and if a subsidized Marketplace plan is your best math, I’ll tell you; if something else fits better, I’ll tell you that too.
Medicare’s Annual Enrollment Period (AEP) runs October 15 through December 7, 2026. Any changes you make take effect January 1, 2027. Here’s what AEP actually covers, what’s new for 2026, and why it’s worth a look even if you’re not planning to change anything.
What AEP Actually Covers
AEP is specifically the window for changing Medicare Advantage and Part D prescription drug coverage — joining, switching, or dropping either. It is not the enrollment window for Medicare Supplement (Medigap) plans. Medigap doesn’t have a single national enrollment period the way Advantage and Part D do; you can generally shop for a Medigap plan at any time, though outside your original Medigap Open Enrollment window or a guaranteed-issue situation, carriers can medically underwrite you.
Why AEP Season Still Matters If You Have Medigap
Even though Medigap itself isn’t on the AEP calendar, fall is still the right time to check a few things:
Your Part D drug plan — if you carry a standalone Part D plan alongside Medigap, its formulary and pricing can change every year, so it’s worth reviewing during AEP (I’m not licensed to sell Part D plans myself, but it’s still worth checking on your end or with your Part D agent).
Your Medigap premium — carriers commonly adjust Medigap rates at renewal. If yours went up significantly, it’s worth comparing what else is available, especially if your health has stayed steady since you first enrolled.
Whether Medicare Advantage still makes sense for you — if you’re on an Advantage plan and considering a move to Original Medicare plus Medigap, AEP is when you’d drop the Advantage plan; just know that moving to Medigap afterward may involve medical underwriting unless you qualify for guaranteed issue.
What’s Different for 2026
A few concrete numbers worth knowing this year:
The standard Medicare Part B premium is $202.90/month for 2026, up from $185/month in 2025.
The Part D out-of-pocket cap increased from $2,000 (2025) to a higher indexed amount for 2026, and enrollees can still choose to spread that cost across the year in equal monthly payments instead of paying it early.
Some insurers are exiting the Medicare Advantage market or reducing plan offerings for 2026 — if that affects your current plan, you’ll likely get a notice from your carrier this fall, and it’s worth acting on it rather than setting it aside.
A Few Common Mistakes During AEP
Comparing plans on premium alone, without confirming your doctors and pharmacy are still in-network. Waiting until the first week of December to make a decision, which leaves little room to fix a mistake before the deadline. Assuming a plan that worked well last year hasn’t changed — formularies and networks are re-evaluated annually, not locked in.
How I Can Help
When you call, I spend about five minutes learning your situation, then I go research quotes across multiple Medigap carriers — not just one company’s price. You get a detailed, side-by-side quote by email, and you review it on your own time. No pressure to decide on the call. I don’t sell Medicare Advantage or Part D plans, so I’m not working an angle when I tell you whether your current Medigap setup still makes sense or not.
I’ve laid out the full turning-65 process in this Medicare checklist, and if Mayo Clinic access matters to your plan choice, I’ve covered exactly which plans keep it in-network in this breakdown.
Frequently Asked Questions
What are the AEP dates for 2026?
Medicare’s Annual Enrollment Period runs October 15 through December 7, 2026. Changes made during this window take effect January 1, 2027.
Does AEP apply to Medicare Supplement (Medigap) plans?
No. AEP covers Medicare Advantage and Part D prescription drug plan changes. Medigap doesn’t have a fixed annual enrollment period — you can generally apply anytime, though medical underwriting may apply outside your original Medigap Open Enrollment window or a guaranteed-issue situation.
What is the Medicare Part B premium for 2026?
The standard Part B premium for 2026 is $202.90 per month, up from $185 per month in 2025. Higher-income enrollees pay more.
What happens if I miss the December 7 AEP deadline?
If you miss AEP and don’t qualify for a Special Enrollment Period, you’ll generally need to wait for the Medicare Advantage Open Enrollment Period (January 1 – March 31), which has more limited options — it only allows switching between Medicare Advantage plans or dropping Advantage for Original Medicare, not adding or changing a standalone Part D plan.
Looking for COBRA alternatives in Arizona? If you just lost job-based health coverage, your employer probably handed you a COBRA packet and a deadline. Before you sign it, it’s worth five minutes to see what else is actually available — because for most people, COBRA is the most expensive option on the table, not the only one.
Why COBRA Costs So Much
While you were employed, your employer was typically covering 60-80% of your premium. COBRA removes that subsidy entirely — you pay the full premium yourself, plus a 2% administrative fee. That’s why COBRA often runs $400-$700 a month for a single person, and considerably more for a family, for coverage that felt “free” or cheap while you had a job attached to it.
You have 60 days from the day your coverage ends to elect COBRA — and that same 60-day window opens up other options you may not know about.
Option 1: ACA Marketplace Plan (Usually the Strongest Option)
Losing job-based coverage triggers a Special Enrollment Period, letting you enroll in an ACA Marketplace plan right away instead of waiting for open enrollment. Marketplace plans cover the same essential health benefits as your old employer plan and can’t turn you down or charge you more for pre-existing conditions.
One important note for 2026: the enhanced premium tax credits that made Marketplace plans unusually cheap in recent years expired at the end of 2025 and were not extended. That doesn’t mean subsidies are gone — most people still qualify for some — but the numbers are different than they were a year or two ago. I’ve written a full breakdown of what changed in this post on the 2026 subsidy situation if you want the details.
Option 2: Short-Term Medical / Private PPO Plans
For healthy people bridging a gap of a few months, short-term medical plans are typically 40-60% cheaper than COBRA. The tradeoff is real, though: these plans are medically underwritten (your health history affects your rate and eligibility), they don’t have to cover the ACA’s essential health benefits, and they can deny claims tied to pre-existing conditions. Some states cap how long you can stay on one.
This is a reasonable option if you’re generally healthy and the gap is short and defined. It’s a riskier one if you have ongoing health needs — a single serious claim denial can cost far more than you saved on premium.
Option 3: A Spouse’s or Family Member’s Employer Plan
Losing your job is a qualifying life event that opens a special enrollment window on a spouse’s or parent’s employer plan, typically within 30-60 days. If that’s available to you, it’s often the cheapest and simplest option of all — worth checking before you assume COBRA or the Marketplace are your only paths.
Option 4: If You’re Near 65, COBRA May Not Be the Right Question
If you’re approaching Medicare eligibility, the calculation changes. Medicare’s Initial Enrollment Period is tied to your birthday, not your job loss, and missing it can trigger a permanent premium penalty. I’ve laid out the full timeline in this Turning 65 checklist — worth a look before you default to COBRA just because it’s the option in front of you.
Choosing Between COBRA Alternatives in Arizona
Run the real numbers before you choose anything:
Compare total cost, not just premium — factor in deductibles and how much of the year is left before they reset.
Check whether your doctors are in-network on the Marketplace or short-term plan you’re considering — COBRA keeps your old network, alternatives may not.
Weigh pre-existing conditions honestly. If you or a family member has ongoing care needs, ACA Marketplace coverage (or COBRA) protects you in a way short-term plans don’t.
Don’t let the 60-day window pass while you’re deciding — once it closes, your options narrow considerably.
Frequently Asked Questions
Why is COBRA so expensive?
While you were employed, your employer was typically covering 60-80% of your premium. COBRA removes that subsidy entirely — you pay the full premium yourself, plus a 2% administrative fee. That’s why COBRA often runs $400-$700 a month for a single person, and considerably more for a family.
How long do I have to elect COBRA coverage?
You have 60 days from the day your job-based coverage ends to elect COBRA. That same 60-day window also gives you time to compare other options, like an ACA Marketplace plan.
What’s usually the strongest alternative to COBRA?
An ACA Marketplace plan is usually the strongest option. Losing job-based coverage triggers a Special Enrollment Period, letting you enroll in a Marketplace plan right away instead of waiting for open enrollment — and Marketplace plans can’t turn you down or charge you more for pre-existing conditions.
Can I stay on a spouse’s or family member’s health plan instead of COBRA?
Losing your job is a qualifying life event that opens a special enrollment window on a spouse’s or parent’s employer plan, typically within 30-60 days. If that’s available to you, it’s often the cheapest and simplest option of all.
How I Can Help
This is exactly the kind of decision where a second opinion pays for itself. I’ll compare COBRA against ACA Marketplace and short-term options side by side, based on your actual doctors, budget, and health situation — not just the premium on the page. My help costs you nothing; you pay the same rate whether I’m involved or not.
