Individuals enrolled in Medicare Advantage health plans are currently in an annual window to reassess their coverage options. Experts advise taking a close look at this year’s choices since both the Centers for Medicare and Medicaid Services (CMS) and private insurers are considering various changes.
In late January, CMS proposed new policies for Medicare Advantage and Part D that are intended to enhance the accuracy of payments made to insurance companies. They indicated that the payment rate for Medicare Advantage is expected to remain almost the same, experiencing a slight increase of 0.9%, which translates to approximately $700 million allocated to plans for 2027.
The rates set by the government influence what insurance companies can charge their policyholders in terms of premiums and other benefits.
After this announcement, the stocks of key healthcare companies dropped. Analysts had anticipated a 4% to 6% rise, but the proposed rates may lead to some benefit reductions or even plan discontinuations.
Data indicates that in 2025, over half (54%) of Medicare beneficiaries were enrolled in Medicare Advantage, with around 34.1 million individuals participating compared to 62.8 million in Medicare Parts A and B.
Medicare Advantage Open Enrollment
Medicare Advantage, also termed Part C, is provided by private insurers and generally covers aspects similar to those found in the original Medicare Parts A and B, along with possible Part D prescription coverage. Registrants can opt into the Medicare Advantage open enrollment until March 31st.
During this timeframe, existing Medicare Advantage members have the option to switch to another plan or withdraw from their current coverage, reverting back to Original Medicare, which includes Medicare Parts A and B, plus specific Part D prescription drug options.
“It’s beneficial for individuals to thoroughly investigate whether they are on a Medicare Advantage plan,” Moller suggested.
These plans often provide desirable features for potential enrollees, like zero premium plans. Additionally, as Moller mentioned, they offer supplemental benefits such as dental, vision, and hearing that the standard government-run Medicare plans typically lack.
“For those who don’t have extensive medical needs, Medicare Advantage can be a practical choice,” he added.
What to Consider Before Transitioning to Original Medicare
For individuals with serious health conditions, sustaining your Medicare Advantage plan might be costlier.
“When you’re in good health, Medicare Advantage feels like a bargain,” said Carolyn McClanahan, a certified financial planner. “But if you become seriously ill, suddenly there are hurdles like pre-approvals and potential denials to contend with,” she explained.
She mentioned that these plans usually require patients to utilize in-network providers instead of seeing their preferred doctors.
During the open enrollment, current Medicare Advantage members can opt for Original Medicare, but they should be cautious. Enrollees of Original Medicare often need to purchase Medigap plans, which can incur significant out-of-pocket expenses covering co-pays, coinsurance, and deductibles.
“It’s crucial for individuals to research their options to ensure a suitable alternative is in place,” Moller recommended. Personally, he shared, he wouldn’t choose Original Medicare without a supplemental plan because of the substantial risks involved.
In many states, those wishing to switch from Medicare Advantage back to Original Medicare must go through an approval process for Medigap. “If you’re already dealing with health issues, qualifying becomes much tougher,” McClanahan warned.
There are, however, four states—Connecticut, Maine, Massachusetts, and New York—where one can transition to a Medigap plan without going through the underwriting process.
