Medicare changes go beyond premiums to drugs, telehealth

By Liz Seegert

KIPLINGER’S PERSONAL FINANCE

If you’reamongthe roughly 70 million peoplewhoget health coverage throughMedicare, the federal insurance programfor people age 65 and older andsomeyounger people with disabilities, you’re probably already aware ofsomeof the big changes to the system in 2026— changes that have hit budgets hard.

This year’s 9.7% jump in premiums forPartB, which covers outpatient care, was the biggest increase in four years and eats upmore than25% of this year’s 2.8% annual inflation adjustment for Social Security benefits.

Meanwhile, cost pressures have caused someMedicareAdvantage plans sold by private insurers to scale back extra benefits, such as dental, vision and hearing coverage, or eliminate others, such as allowances for transportation and overthe- counter purchases. Insomecases, private insurers have shut downplans or exited markets entirely.

Those headline-grabbing shifts, however, aren’t the only big changes to Medicare this year— and not all of the developments hurt your bottom line. You maybenefit fromnewpolicies regarding drug pricing and telehealth services. But thenewrequirements for prior authorization insomeareas and possible further shake-ups toAdvantage plans? Not so much.

"There’s a lot to think about and a lot to compare, and it can just be really overwhelming," says Lindsey Copeland, director for federal policy at theMedicare Rights Center.

Here’s the lowdownon this year’sMedicare changes.

SOME DRUGS ARE GETTING CHEAPER

New, lower priceswent into effect on Jan. 1 for 10 drugs covered underMedicarePartD, the first price reductions to be negotiated byMedicare directly with pharmaceutical companies under a landmark provision in the 2022 Inflation ReductionAct. Themedications include blood thinners Eliquis andXarelto, diabetes drugs Jardiance and Januvia, and heart-failure treatment Entresto.

Thenearly 9 millionPartDbeneficiarieswhotake these drugs will pay about 50% less on average than in 2025, according to the Centers forMedicare& Medicaid Services (CMS). But individual savings will depend on the particular drug and drug plan, and could range froma few hundred dollars to several thousand, says Gerard Anderson, a professor in the department of health policy and management at JohnsHopkins Bloomberg School of PublicHealth.

Lower, negotiated prices on an additional 15 drugs, including the diabetes and weight-loss medications Ozempic and Wegovy will go into effect in 2027 Athird round of negotiations, announced in January, will cover 15more drugs, including Botox (to treat migraines and muscle conditions, not for cosmetic purposes), theGLP-1 diabetes drugTrulicity, and several cancer medications. Those prices will take effect in 2028.

Whattodo: If you have diabetes or another conditioncommonlytreated by drugs whose prices have been negotiated byMedicare, but your particular medication is notamongthem, ask your doctor if itwould be appropriate for you to switch to one that is. A30-day supply of diabetes medications Januvia andFarxiga now costs79% and68% less, respectively, than their 2023 list prices. If you currently take other medications to treat the condition, such asMounjaro or Afrezza, you could save a bundle.

Youmayalso qualify for a temporary program, MedicareGLP-1 Bridge, that will coverGLP-1 drugsWegovy and Zepbound forweight reduction this year. If you’re enrolled inPartD, you’ll pay just a $50 monthly co-pay for treatment between July 1 and Dec. 31. You need pre-authorization fromyour doctor.

TELEHEALTH IS STICKING AROUND

Prior to the pandemic, Medicare’s telehealth coveragewas generally limited to rural areas and required patients to travel to a designated clinic to receive care remotely. Many restrictionswere lifted during the pandemic, making telehealth more widely available, but those benefits have been on the government’s chopping block recently.

InFebruary, Congress extended key provisions through 2027. These include allowing beneficiaries to receive services athomeby video and audio regardless of geographic location; audio-only visits for thosewhocan’t use video; and expanded coverage for remote care byphysical and occupational therapists and other health providers.

"Telehealth has been an important tool to ensure that people can access the care they need, whenand where they need it," says Gretchen Jacobson, vice president of Medicare atTheCommonwealthFund.

Whattodo: Ask your doctor’sofficewhich appointments can be handled through telehealth, such as test-result reviews or medication check-ins. Many practices that expanded services during the pandemic have kept it as an option. Telehealth can’t replace all types of primary care, however, such aswellness visits, immunizations, andsomeurgent or acute-care needs.

YOUMAY NEED TOJUMPTHROUGHA FEWMORE HOOPS

Under a six-year pilot programthat launched in January, you nowneed prior authorization to receive certain medical services if you’re covered under origi nalMedicare and live in one of six states: Arizona, NewJersey, Ohio, Oklahoma, Texas orWashington. The17 procedures subject to artificial intelligence-assisted prior review includesomesteroid injections for pain management andsome nerve-stimulation techniques used to treat Parkinson’s disease, incontinence and sleep apnea.

TheCMSsays approval decisions will bemadewithin 72 hours and that licensed clinicians, not AI or the outside organizations running the program, willmake final coverage decisions.

Butsomepolicy experts have expressed concern over the potential impact. "The companies that have been hired to administer the approval process are incentivized to reduce spending, which means approving fewer services," says Jacobson.

Whattodo: If you live in one of the affected areas and your doctor recommendsone of the services identified in the pilot program, make sure the provider gets prior approval. Otherwise, you could be hit with a huge bill afterward.

ADVANTAGE PLANS COULD BECOME MORE RESTRICTIVE

In January, theTrumpadministration issued a proposal to keep reimbursement rates toMedicareAdvantage insurers nearly flat next year, compared with the 4% to6% boost insurers had anticipated. Thenews prompted direwarnings about the possible impact on enrollees.

"Flat programfunding at a time of sharply rising medical costs and high utilization of care will impact seniors’ coverage," said Chris Bond, a spokesperson for AHIP, the national health insurance trade organization, in a statement at the time. "If finalized, this proposal could result in benefit cuts and higher costs for 35 million seniors and people with disabilitieswhen they renewtheirMedicareAdvantage coverage in October 2026."

In earlyApril, CMSannounced the reimbursement rate had been finalized at 2.48%, higher than the initial0.09% proposal but probably not high enough to prevent changes insomeplans for 2027.

Whattodo: If you’re enrolled in aMedicareAdvantage plan, carefully review the "annual notice of change" you get this fall for any adjustments to premiums, deductibles, co-pays and benefits. That will give you time to consider alternatives before open enrollment, which runs fromOct. 15 to Dec. 7.

If you sign up for anAdvantage plan but then have second thoughts, you’ll have another shot at choosing during the separateMedicareAdvantage open-enrollment period fromJan. 1 toMarch 31. During this time, you can switch to a different plan or to originalMedicare. Says Jacobson, "It’s important to rememberyou have options"

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