What specific changes can those of us on Medicare Advantage Plan HMOs or PPOs expect for 2026?

Question from Joan: You wrote last week that many Medicare Advantage Plans are going to have "significant changes" in 2026. I moved to another company in 2025 because the one I had previously went to a $585 deductible on the Tier 3 medication I was taking. I saved a lot of money by changing companies and plans. Can you tell me what specific changes I'm going to see next year? As a retiree on a fixed income, I'm obviously concerned.

Answer: Before I get started let me make a couple things clear. Although I did describe changes as "significant," I don't want anyone to panic because on the most popular plans, they certainly aren't drastic by any means. I'm pleased in that regard. That being said, there are going be some adjustments to plans for 2026 that people will definitely want to be aware of and budget for.

Reasons for changes in most popular Advantage Plans

2021 through 2025 was what I called the "Golden Age" of Advantage Plans. Never in my 18 years in being in the business had plans offered such great value in terms of the combination of low premiums, co-pays, and Maximum Out of Pocket (MOOP) which all went down substantially during that time; lower drug costs with no deductibles; and more generous packages of ancillary benefits, the no cost "extras," that made Advantage Plans so popular. As I wrote about on numerous occasions, it simply wasn't sustainable with the Medicare program having well documented financial challenges.

There was also something that happened in 2024 and 2025 that no one predicted. Those on Advantage Plans utilized far more medical services and prescription drugs than the insurance companies anticipated. This resulted in lower, or even no profits, on most plans. The end result had to be a shift of higher costs to those on Medicare, both Advantage Plans and Supplements.

Specifically, what we're going to see from the "Big Three" Advantage Plan companies that have about 90% of the HMO and PPO market share in Western Pennsylvania are one or all of the following: slightly higher premiums; the inclusion or increase of a prescription drug deductible, up to $615 for Tier 3 through 5 medications; much higher costs for Tier 3 drugs; slightly higher MOOPs and co-pays; reductions in dental and OTC benefits.

2026 Advantage Plans provide wide variety of options

It's not terrible news because again, there were no changes I consider drastic. What I actually like about 2026 is the diversity of plans offering a wide variety of benefits and network combinations.

Although there will be some people who are going to be forced to spend a bit more money out of pocket on premiums, deductibles, and co-pays, our agents will be able to find a plan or plans that will work for all clients' preferences and priorities.

For example: There are still a select few plans with no drug deductible and flat co-pays for Tier 3 drugs. Those who value prescription cost savings can choose one of those if they're willing to sacrifice comprehensive dental or OTC benefits. This may be a good choice for Joan, who is currently on a plan that has a $0 deductible, but will be increasing to $615 in 2026.

Some people need to prioritize a national network and don't have a problem paying a bit more premium and higher co-pays, while others may prefer taking a plan with a regional network that has lower premiums and co-pays while maintaining more extras.

There are really good HMOs specifically designed for people who have other access to drug coverage such as Veterans and people who have PACE or PACENET.

There are going to be plans that offer a large Part B premium reduction, aka "buy back," and others available to people with chronic conditions such as diabetes or heart disease that will offer grocery allowances that were so popular in 2024 but were eliminated on many plans in 2025. These extras are going to be very attractive but come with some sacrifices that need to be understood, such as hospital co-pays as high as $2,500 and less dental coverage. I'm a bit afraid some of these "trap doors," as I call them, won't be disclosed by unscrupulous or untrained agents.

Long-term outlook and need for experienced agents

All these options, which can also create confusion, will make having an experienced agent and agency more important than ever. And not just in 2026, but beyond. Advantage Plans are going to have to evolve as companies get reimbursed by Medicare at rates that don't keep up with the higher cost and utilization of health care services and prescription drugs.

Although I'm pleased the most popular 2026 Advantage Plans will still offer very good overall value, I do believe we're going to see incremental changes in the coming years that will continue to pass some additional premiums and out of pocket costs onto the consumer. I also predict there will be a time in the future where people may be forced to choose between more expensive Advantage Plans that have larger networks and more choices in doctors and hospitals, versus taking a plan with a smaller network, possibly limiting access to one or the other of our two major Western PA health care providers, in exchange for lower premiums and co-pays.

The Health Insurance Store will always make sure our clients are aware of all options and advise them to make the best decisions based on their healthcare needs and budget along with the many other considerations that need to be evaluated. We are also well versed in state, Federal, and private programs that can help clients alleviate financial pressures and burdens for those like Joan who are on a fixed income.

Annual Election Period (AEP) starts October 15th. If you have any questions regarding this column, what changes you can expect in your Advantage Plan for 2026, or would like to make an appointment to compare plans side by side during AEP, give us a call or email me personally, [email protected].