Medicare Changes are Coming in 2026. Are You Ready?

Changes coming to Medicare in 2026 are designed to make healthcare more affordable and easier to navigate – but understanding what’s new can help you make the most of your benefits.

Prescription Costs and Negotiated Caps

Starting in 2025, the Inflation Reduction Act brought big changes to how Medicare handles prescription drug costs. It sets a $2,000 annual cap on out-of-pocket costs for Part D medications, and the payments can be spread evenly throughout the year, making it easier to budget. That cap increases slightly each year, and for 2026 it will be $2,100.

The Part D “donut hole” - that confusing coverage gap - was completely eliminated in 2025 and will not come back in 2026. You will also continue to receive recommended vaccines at no cost, and insulin copays will stay capped at $35 a month.

Another big change for 2026 is that Medicare will start rolling out its first round of negotiated drug prices. This means lower costs for commonly used medications - like those for arthritis, blood clots, cancer, and diabetes. According to the Centers for Medicare & Medicaid Services (CMS), these lower prices are expected to save Medicare beneficiaries about $1.5 billion in out-of-pocket costs next year alone.

Ability to Switch from Medicare Advantage to Medigap

If your Medicare Advantage plan isn’t offered in 2026, don’t panic - you have options. Some insurers are pulling out of certain markets in 2026, but during open enrollment, you can choose a different Medicare Advantage plan, or you can switch back to Original Medicare.

If you decide to return to Original Medicare, you will also have guaranteed access to a Medigap (supplemental) plan, meaning insurers can’t deny you coverage based on your health.

Typically, there’s no nationwide open enrollment period for Medigap, so people switching from Medicare Advantage must undergo medical underwriting to be approved. But if your plan is ending, that rule doesn’t apply - you are automatically eligible for Medigap coverage.

New Prior-Authorization Pilot in Original Medicare

Starting January 1, 2026, the Centers for Medicare & Medicaid Services (CMS) will launch a new pilot program, the Wasteful and Inappropriate Service Reduction (WISeR) Model, in six states - Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington.

Under this test program, 17 specific medical procedures and services will require prior authorization for people enrolled in Original Medicare. The idea is to help reduce fraud, waste, and unnecessary treatments while still ensuring patients get the care they need.

If the pilot goes well, CMS may consider expanding the program to other states, as prior authorization is common in Medicare Advantage plans.

Your Medicare Advantage Plan Might Have Fewer Supplemental Benefits

Beginning in 2026, Medicare Advantage (MA) Plans will face stricter rules on the Special Supplemental Benefits for the Chronically Ill (SSBCI) they can offer. These benefits - meant to support people with chronic conditions - can no longer include:

• Non-healthy food
• Alcohol, cannabis, and tobacco products
• Certain cosmetic procedures, such as facelifts and treatment for facial lines
• Life insurance and funeral planning expenses

This change continues a broader trend of insurers scaling back supplemental perks like over-the-counter allowances, meal programs, transportation, and nutrition services. While these benefits aren’t going away entirely, many plans are narrowing their coverage to focus more on essential care.

Benefit-access and Preventive-care Expansions

In 2026, Medicare is also increasing its focus on coordinated and preventive care. The Medicare & You 2026 handbook highlights new support for Advanced Primary Care Management services - monthly payments that encourage doctors to provide 24/7 care access, team-based coordination, and better management for chronic conditions.

Preventive coverage is also expanding, including a broader range of colorectal cancer screenings and other early-detection services, all designed to help beneficiaries stay healthy and avoid more serious issues later in life.

Summary

Medicare’s 2026 updates bring a mix of cost savings, better protections, and improved access to care. While some changes may limit extras, most updates aim to make care more affordable, transparent, and easier to navigate. Reviewing your plan each year - and knowing how these updates affect you - can help you get the most out of your Medicare coverage in 2026 and beyond.

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