Routine annual changes to Medicare and Medicare Advantage plans, combined with sweeping federal spending cuts, mean that 2026 has developed into a turbulent year for the health insurance industry.
The new plan year has brought “a lot of disruption,” says Jason Mackey, an author and advisor with Medicare Blueprint Advisors in Columbia and Charleston, South Carolina.
Medicare’s open enrollment period for 2026 closed on December 7, 2025. You won’t be able to make changes until the next open enrollment period begins on October 15, 2026, and any changes made then would take effect in 2027. In the meantime, it’s important to know what changed in 2026 and where trends may lead in 2027 and beyond.
[Read: How to Use Medicare’s New Telehealth Coverage.]
At a Glance: Medicare 2025 vs. 2026 Rates and Rules
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[Read: When Can You Sign Up for Medicare?]
Medicare Changes in 2026
The following eight changes have likely impacted your Medicare coverage in 2026:
1. Prior authorization rule changes
2. Continued growth of Medicare Advantage enrollment
3. Changes to Medicare Advantage plans
4. Government cuts to Medicare
5. Delayed Medicare Savings Programs rollout
6. Medicare Part D changes
7. Access to free vaccines
8. Out-of-pocket cap increase
1. The ‘prior authorization’ crisis: new 2026 rules for faster approvals
New rules that went into effect on January 1, 2026, require faster prior-authorization decisions for Medicare and Medicare Advantage beneficiaries. The Centers for Medicare & Medicaid Services’s Interoperability and Prior Authorization Final Rule, or CMS-0057-F, aims to fix what some have called the “prior authorization crisis” by forcing Medicare Advantage, Medicaid and health insurance marketplace plans to implement faster, more transparent and electronic approval processes.
Prior authorizations are approvals that your health insurer requires your provider to submit prior to your starting a treatment so that the procedure or medication will be covered. It’s a common feature of many health insurance plans that’s used to control costs; ensuring that the treatment is truly necessary before spending the money on it can theoretically save money and potentially eliminate wasteful or fraudulent spending.
Original Medicare beneficiaries face prior authorization delays less often than people who have Medicare Advantage. But in all cases, getting stalled by a prior authorization request can be frustrating for patients and providers, and this process can sometimes delay care.
In an effort to streamline the process and reduce waiting times, from January 1, 2026 onwards, payers must:
— Respond to standard (nonurgent) requests within 7 calendar days (previously a 14-day limit)
— Respond to expedited (urgent) request within 72 hours
— Eliminate vague, automated rejections
— Provide detailed reasons for denials so that providers can submit necessary documentation for appeals
— Publish annual metrics on their prior authorization programs, including approval rates by procedure and average decision times
— Eliminate paper-based or fax-only processes and move to an electronic authorization process
— Honor existing authorizations for a 90-day transition period after a patient changes plans to reduce treatment interruptions
[READ: What to Do if AI Denies Your Medicare Claim or Prior Authorization]
2. Continued growth of Medicare Advantage enrollment
In March 2025, KFF reported that since 2010, the share of Medicare beneficiaries enrolled in a private Medicare Advantage plan has more than doubled. Further, the Congressional Budget Office has projected that nearly two-thirds of all Medicare beneficiaries will be enrolled in Medicare Advantage plans rather than original Medicare by 2034.
This growth has been spurred by a range of factors, including potentially lower costs and the inclusion of dental coverage, health savings accounts and prescription drug benefits in private plans.
Heading into 2026, the Trump administration poured $25 billion more — an increase of some 5% — into private Medicare plans to encourage expansion.
Nevertheless, several carriers eliminated some of their Medicare Advantage plans in 2026, which reduced the range of options beneficiaries could choose from in certain markets.
And, in late January 2026, the Trump Administration offered an increase of $700 million — that’s less than 1% — for the 2027 plan year. Some providers say that rate won’t be enough to enable them to continue offering certain Medicare Advantage plans.
Insurance companies and advocacy groups have pushed back and the proposal won’t be finalized until sometime in April 2026, but if Medicare Advantage funding remains flat next year, that could push other private insurers out of the market and further curtail options for older Americans.
3. Changes to Medicare Advantage plans
Some of the perks included in many Medicare Advantage plans have also been trimmed, as the companies that provide these plans sought cost savings to offset increases elsewhere in 2026.
Plan modifications related to care provider networks, a reduction in supplemental benefits, such as vision and dental coverage, and increased cost-sharing for Medicare Advantage and Medicare Part D plans were all part of the picture, says Whitney Stidom, vice president of consumer enablement with eHealth Inc., a health insurance broker and online resource provider headquartered in Austin.
Care provider networks are updated annually, and in 2026, some Medicare Advantage plans shrank those networks. For some beneficiaries, this meant they needed to move to a different plan or find a new provider, because going out of network can result in significantly higher costs or even no coverage at all for nonemergency services.
Enrollees in Medicare Advantage plans may also encounter limits to Special Supplemental Benefits for the Chronically Ill, or SSBCI, which tailors special benefits for certain medical conditions. CMS maintains a list of items and services that it doesn’t include or cover because they’re deemed not health-related or don’t meet the standard of improving or maintaining health or function. Some examples include:
— Cannabis products
— Certain foods
— Life insurance
— Funeral planning and expenses
[Read: How to Choose the Best Medicare Advantage Plan]
4. Government cuts to Medicare
The One Big Beautiful Bill Act, which was signed into law on July 4, 2025, cut more than $1 trillion from health programs. The bill reduced Medicare funding by approximately $500 billion between 2026 and 2034.
Medicaid (the joint federal and state health insurance program for low-income individuals), Medicare Advantage plans, stand-alone prescription drug plans and hospitals also saw cuts in reimbursements.
Rural hospitals have been particularly affected. The payments those hospitals receive when they provide care to people on Medicaid — and potentially those on both Medicare and Medicaid, known as “dual eligibles” — help them stay open, pay health care providers and purchase diagnostic equipment and supplies, KFF reports.
Hopkins notes that while the pressures on rural hospitals across the country are intense, there is “room for innovation” in terms of finding better ways to improve elements of both Medicare and Medicaid to find efficiencies and cost savings in ways that don’t further threaten the sustainability of rural hospitals.
[READ: Medicare Mistakes to Avoid.]
5. Delayed Medicare Savings Programs rollout
While Medicare has been a lifeline for many older adults since its establishment in 1965, it doesn’t cover all costs, and efforts to bridge gaps in coverage have taken a number of forms over the years.
In 2023, a new bill was passed to reduce barriers to enrollment in Medicare Savings Programs. These programs help low-income Medicare beneficiaries afford their premiums and cost-sharing expenses, including deductibles, coinsurance and copayments.
MSPs can help people on fixed incomes or those who’ve lost a spouse and are now trying to get by on a single Social Security income check, Hopkins adds.
However, the implementation of some of those programs has been delayed until 2035 as part of the One Big Beautiful Bill Act, Hopkins notes. And while this change might not be as obvious as some of the cuts the news has reported, Hopkins believes it’s a “big barrier” to people getting additional help to afford the care they need.
The CBO agrees, estimating that the consequences of halting implementation of the rule would mean 1.3 million dual-eligible Medicare enrollees would lose their Medicaid coverage by 2034 if key eligibility and enrollment rules are not implemented.
6. Medicare Part D changes
The Part D Premium Stabilization Demonstration, a one-year program with an optional annual extension for up to two years, has been extended for 2026. However, the monthly premium subsidy has been reduced to $10, and the premium increase cap was raised to $50. The risk corridors component was also eliminated. All of this means some companies will no longer offer Part D plans because of cost increases.
KFF reports that the number of stand-alone Part D plans available in the U.S. dropped from 464 in 2025 to 360 plans in 2026. The plans exiting the market tended to be lesser expensive ones, while higher-cost plans have generally fared better.
Mackey says these changes have been concerning because in some cases, couples who didn’t have to pay any premium in previous years may suddenly have to pay considerably more per month.
Those price pressures may further push beneficiaries into Medicare Advantage plans, Mackey notes — not because they want to, but out of affordability.
“That doesn’t necessarily mean that’s the best option for them, it’s just more affordable,” he points out.
Some Part D plans also curtailed their coverage of some of the more expensive medications currently on their formularies. While there are generic versions of many medicines on the market, not every name-brand drug has a generic alternative, and sometimes an individual responds better to one medication than another. Limiting those options can have significant health consequences for some people.
7. Access to free vaccines
Beginning in 2023, Medicare Part D plans have provided a limited number of free vaccines, a program that was extended for 2026.
In 2026, Medicare Part D plans cover all commercially available vaccines when they’re reasonable and necessary to prevent illness, except for those covered by Medicare Part B. This includes vaccines to prevent:
— Shingles
— Tetanus-diphtheria-pertussis
In 2026, Medicare Part B covers vaccines and vaccine administration for:
— Flu
— Hepatitis B for people at high and intermediate risk
— COVID-19
— Certain reasonable and necessary vaccines to treat an injury or exposure to a disease
These vaccines have been recommended by the Advisory Committee on Immunization Practices (ACIP), a widely respected group of public health professionals who make annual recommendations about vaccines to the Centers for Disease Control and Prevention.
However, on June 9, 2025, Secretary of Health and Human Services Robert F. Kennedy Jr. dismissed all 17 members of the ACIP. This move calls into question whether the new members of ACIP — some of whom have previously voiced vaccine skepticism — will continue to recommend the same slate of vaccines going forward.
8. Out-of-pocket cap increase
The Inflation Reduction Act included a provision that capped the annual out-of-pocket costs for prescription drugs for Medicare beneficiaries. In 2026, that cap rose to $2,100.
Review your Medicare Part D prescription drug formulary in 2026 to confirm that your current medications are still covered and to estimate your out-of-pocket costs.
When Can I Next Make Changes to My Medicare Plan?
There are a set number of periods when you can sign up for Medicare or change plans.
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To ensure you’re getting the best coverage for your needs, you should:
— Review the Annual Notice of Change letter you get from your insurance company when it arrives (usually during the summer months), as that outlines all the changes to your current plan and how they will affect your coverage.
— Consider how your health and financial circumstances may have changed since last year.
— Look at the prescription medications you’re currently taking, and connect with your health care provider about any anticipated changes that might be made to your medications in the coming year.
— Contact your State Health Insurance Assistance Program for more information about what you may be eligible for. This is a free service offered by each state, and each SHIP office is staffed by highly trained, knowledgeable volunteers.
— Talk with a local, licensed insurance agent, as they can help you sift through your local options. However, Hopkins warns against working with any agents who are seeking to charge you for advice; independent agents should never charge the beneficiary for assistance in selecting a plan.
How AI Is Impacting Medicare in 2026 and Beyond
Artificial intelligence’s infiltration into health care is also transforming Medicare.
“AI is playing a bigger role in how people enroll in Medicare, marking a major shift in how beneficiaries navigate benefits and get connected with a licensed agent to review plan options,” Stidom says.
In addition, AI is transforming how insurance carriers conduct their day-to-day business, from making decisions about customer eligibility for certain plans to determining whether the company will pay for specific services. Therefore, you may want to ask prospective health insurance carriers if their company is embracing AI and, if so, how your information is being used.
Nevertheless, CMS has said that Medicare Advantage companies may use AI-enabled technology to make coverage determinations, as long as these technologies adhere to rules, such as those used to determine whether a procedure or treatment is medically necessary.
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How Changes to Medicare in 2026 Are Affecting Your Coverage originally appeared on usnews.com
Update 03/04/26: This story was published at an earlier date and has been updated with new information.
