Medicare Advantage · 2027 Changes

Today’s Medicare Advantage Benefits May Not Be Tomorrow’s Benefits

Dental. Vision. Gym memberships. OTC allowances. These extras are why millions choose Medicare Advantage — and they can disappear in January without warning.

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Breaking — May 2026

Humana’s CEO publicly stated the company will need to cut benefits in 2027 to meet profit targets after CMS finalized a 2.48% payment increase — a rate industry executives say fails to keep pace with rising medical costs. Industry analysis projects dental and vision benefits could be reduced by as much as 50% for some plans.

The short answer

Medicare Advantage plans can change their benefits, copays, networks, and drug formularies every single year. The extras that made a plan attractive in 2026 may be reduced or eliminated in 2027 — and with real cuts already being signaled by major carriers, this risk is no longer hypothetical. Supplemental benefits should be part of your decision, not all of it.

What a plan can look like today — and what it can become

Every year I talk to people who chose a Medicare Advantage plan because of a specific benefit. A generous dental allowance. An over-the-counter card. Free transportation to appointments. A gym membership. These are real benefits that provide real value — and they are advertised heavily for exactly that reason.

But here is what the commercials never mention: none of it is guaranteed past December 31st.

How supplemental benefits can shift from one year to the next

Your Plan Today

✓$2,000 dental allowance

✓$500 vision coverage

✓$1,500 hearing benefit

✓$100/quarter OTC card

✓Free gym membership

✓Free transportation

✓$0 monthly premium

→

The Same Plan — Next Year

✗$2,000 dental allowance

✗$500 vision coverage

✗$1,500 hearing benefit

✗$100/quarter OTC card

✗Free gym membership

✗Free transportation

✗$0 monthly premium

This is not a hypothetical. Every item above is subject to change on January 1st of any plan year — with no action required by the carrier beyond mailing you the Annual Notice of Change in September.

The Annual Notice of Change arrives every September. It tells you exactly what is changing in your plan for the coming year. Most people set it aside or throw it away. That letter is the most important piece of Medicare mail you will receive all year. Read every page.

Why 2027 is different — and why the risk is real right now

Benefit changes happen every year, but 2027 is shaping up to be a more significant year than most. Here is what is driving it.

In April 2026, CMS finalized a 2.48% average payment increase to Medicare Advantage insurers for 2027. On paper that sounds like a raise. In practice, insurance executives say medical inflation is rising far faster than that rate — and the math doesn’t work. Plans have limited options when revenue doesn’t cover costs: raise premiums, exit markets, or cut supplemental benefits. Supplemental benefits are almost always the first to go.

Humana’s CEO confirmed in May 2026 that the company would cut benefits to reach its 2028 profit targets. Industry analysis by AHIP and Wakely Consulting projects that under the anticipated reimbursement environment, dental and vision benefits could be cut by as much as 50% for some plans — and out-of-pocket maximums could rise by $1,000 or more. Not every plan will make every cut. But the direction of travel is clear.

There is a second factor worth understanding. Plans that earn four or more CMS quality stars receive bonus payments that directly fund supplemental benefits and $0 premiums. If a plan’s star rating drops, those bonus dollars shrink — and supplemental benefits are typically the first casualty. A plan that earned five stars in 2026 and offered exceptional extras could look very different in 2027 if its rating slips.

Dental and vision coverage are the benefits most exposed to 2027 cuts based on carrier statements and industry analysis.

Over-the-counter allowances have already been reduced by multiple carriers in recent plan years and remain at risk.

Transportation and meal programs are “nice to have” extras that disappear first when carriers need to find savings quickly.

$0 premiums are funded partly by the star-rating bonus system. Plans under financial pressure will not hold the line at $0 indefinitely.

What to evaluate before you choose a Medicare Advantage plan

I’m not saying supplemental benefits don’t matter. They do. A $2,000 dental allowance is real money, and if you use it, it belongs in your decision. What I’m saying is that the extras should be part of the evaluation — not the whole thing.

Before I compare dental allowances for any client, I walk through five questions that have a far greater long-term impact on what their Medicare experience looks like.

Your Doctors

Are your current doctors in-network? For HMO plans especially, going out of network typically means paying the full cost yourself. Verify before you enroll — not after.

Your Hospitals

The hospital network matters most in a crisis. Some hospital systems have been dropping Medicare Advantage contracts due to low reimbursement rates. Confirm your hospital is still in-network for 2027.

Your Prescriptions

Drug formularies change annually. A medication covered in 2026 may be on a higher tier — or off the formulary entirely — in 2027. Run your drug list against the plan before you commit.

Out-of-State Coverage

HMO plans generally don’t cover out-of-network care except emergencies. If you travel or split time between states, this restriction could leave you with no coverage when you need it most.

Maximum Out-of-Pocket

Medicare Advantage out-of-pocket maximums have risen significantly — some plans now cap at $9,350 or more annually. If your health changes, that ceiling determines your worst-case financial exposure.

Long-Term Health Trajectory

Healthy people often do well on Medicare Advantage. The calculus changes if your health needs grow. A plan that looks great at 65 may perform very differently at 72 — and switching later may require medical underwriting.

The underwriting trap: Medicare Advantage plans do not require health questions to enroll. But if you want to switch from Medicare Advantage to a Medicare Supplement later — because your health has changed and you need better coverage — you will face underwriting in most states. A carrier can decline you or charge you more. The time to make the Supplement vs. Advantage decision is at initial enrollment, not after years on an Advantage plan. Learn more about the Medicare underwriting trap.

What to do if you’re already on a Medicare Advantage plan

If you’re currently enrolled, the most important thing you can do is read your Annual Notice of Change when it arrives in September. Every plan is required to send it. It will tell you, in writing, exactly what is changing in your plan for the coming year — premiums, copays, network changes, drug formulary updates, and supplemental benefits.

If you see changes that concern you, the Annual Enrollment Period runs October 15 through December 7. During that window you can switch plans, and your new coverage takes effect January 1st. You are not locked in. But the window closes, and missing it means waiting another year.

If you are new to Medicare, or still deciding between Medicare Advantage and a Medicare Supplement, I’d encourage you to think beyond this year’s benefits before you choose. The extras matter. The fundamentals matter more.

One more thing about the Annual Notice of Change: the law requires plans to mail it, but it does not require them to highlight what’s being cut. The changes are in there — in the fine print, buried in tables. Read the whole thing, or have someone help you compare it against your current benefits.

Not sure if your plan will hold up in 2027?

I’ll run every plan available to you side by side — networks, drug costs, out-of-pocket exposure, and yes, the supplemental benefits too — and give you my honest read on which one holds up over time, not just this year.

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