THE ARISING · Markets & Strategy
Typical Medicare Beneficiary Loses Four Advantage Drug Plan Options for 2027
The average Medicare beneficiary will have 28 Medicare Advantage prescription drug plans to choose from in 2027, down from 32 in 2026, according to a KFF analysis published October 1.
That is a loss of four options for the typical person. The count peaked at 36 in 2024. It had grown steadily from 2010 to that point. For 2027, it remains above the 2021 level of 27 and every year before it.
The decline shows up across the wider market too. Counting all Medicare Advantage plans open to general enrollment, with or without drug coverage, the average beneficiary will see 35 plans in 2027, compared with 39 in 2026, according to KFF. KFF's figures exclude special needs plans and employer plans.
The pullback is uneven by state. Texas has the largest drop in drug-plan options for the average beneficiary (nine fewer). Illinois and Ohio each lose eight. Minnesota, New Mexico and Washington each lose seven. Nine states keep the same number as in 2026, and four states gain options, according to KFF. Alaska has none in either year.
Some states remain crowded. Pennsylvania, Michigan and Ohio each offer the average beneficiary at least 40 drug-plan options. In 26 states and Puerto Rico, the average beneficiary has at least 20. At the other end, nine states and the District of Columbia have fewer than 10.
For insurers, the figures point to a market that is trimming overlap rather than leaving. KFF notes that the Centers for Medicare and Medicaid Services (CMS) emphasized stability in the overall marketplace. KFF's data do not say why plans were dropped, so any link to insurer margins, payment rates or regulation would be interpretation, not finding. Still, with the number of options falling in most states, the remaining plans in a county compete against a smaller field.
For beneficiaries, the effect depends on where they live and what plan they hold. KFF says most people whose plan exits live in counties that still have many Medicare Advantage options, plus traditional Medicare. Some can move to another plan from the same insurer. Many will be moved automatically if the insurer has a plan of the same type, such as an HMO or PPO, in the same county. Others must choose a new plan or will default to traditional Medicare.
That puts weight on the enrollment window. Marketing began October 1. Open enrollment runs from October 15 through December 7. Yet KFF reports that most beneficiaries say they do not compare coverage options each year. Earlier focus groups found people overwhelmed by the number of choices. Plans also change premiums, cost sharing, out-of-pocket limits, prior authorization rules, drug lists and provider networks each year.
Most Medicare Advantage enrollees are in plans that include drug coverage, according to KFF. About 4% of 2026 enrollees were in plans without it. Most pay no premium beyond the Part B premium.
What to watch next
CMS releases plan benefit and cost data separately, and KFF says a fuller analysis will follow. Those details will show whether fewer plans also means thinner benefits or tighter rules.
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