Medicare Open Enrollment 2027: Compare Total Costs, Not Just Premiums

A Medicare drug plan’s monthly premium is easy to compare. The yearly bill takes more work. Yet what you spend on prescriptions next year also depends on the plan’s deductible, what it charges for each drug you take, and which pharmacies it treats as in-network. Two plans that look $25 a month apart can end up hundreds of dollars apart in the other direction.

Medicare’s annual Open Enrollment period runs from October 15 through December 7, 2026, for changes effective January 1, 2027. The plan must receive your enrollment request by December 7. During the window, you can switch Medicare Advantage plans, join or switch a standalone drug plan if you have Original Medicare, or move between Original Medicare and Medicare Advantage. Here, we focus on comparing a full year of standalone drug-plan costs for someone with Original Medicare.

Scene images: AI illustrations.

Start with what’s changing

If you have a Medicare plan now, it should have sent you an Annual Notice of Change. Medicare says it arrives in September and lists coverage and cost changes that take effect in January. Read it before you shop, and call the plan if it never came. Keeping your current plan is a decision too, and it deserves the same comparison as any new option.

The number that matters: premiums plus drug spending

A fair comparison adds two yearly figures for each plan: twelve months of premiums and your estimated out-of-pocket drug spending. Medicare’s overview of drug coverage costs lays out the pieces. The premium is a monthly charge owed whether or not you fill a prescription. Deductibles vary by plan; in 2027, no Medicare drug plan may set one above $700, and some have none. Copayments or coinsurance for each drug also depend on the plan. Once your out-of-pocket spending on covered Part D drugs reaches $2,400 in 2027, you pay nothing more for covered Part D drugs for the rest of that calendar year, and certain payments made on your behalf can count toward that amount. Premiums do not count toward that threshold. It is not a cap on medical bills or total health care spending.

Check what each annual estimate includes. If deductible payments are already included in patient drug spending, adding the full deductible again would count them twice. If premiums are already in a combined total, don’t add those twice either.

A simple example that cuts both ways

Consider two hypothetical spending profiles, not actual plan quotes. Within each profile, assume both options cover the same medication list at usable in-network pharmacies. The lower-premium option costs $10 a month; the higher-premium option costs $35. Drug spending figures are assumed annual estimates that already include any deductible, copays, and coinsurance, and do not imply twelve identical monthly bills. Extra Help, income-related premium adjustments, penalties, other subsidies, Part A and Part B premiums, Medigap premiums, and medical care are all left out.

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In the lower-spending profile, the cheaper premium wins: $300 for the year against $540. In the higher-spending profile, the order flips. The higher-premium option costs $300 more in premiums but cuts pharmacy spending by $480 in this example, so it finishes $180 ahead. Sometimes the low premium really is the better deal. The premium alone just can’t tell you which case you’re in.

Getting real numbers

Medicare’s official Plan Finder is where you can replace these made-up figures with estimates for your own prescriptions. Its results are only as good as what you enter.

1. Choose the right year and location. Use the ZIP code for your residence and check that you are comparing the 2027 plan year.
2. Enter each drug precisely. Strength, form, quantity, and how often you refill can all change the estimate.
3. Pick the pharmacies you will really use. An in-network pharmacy is not always a preferred pharmacy. Medicare explains how preferred and mail-order options can affect costs.
4. Compare yearly totals. Look at estimated annual drug costs plus premiums, and include your current plan in the lineup.
5. Confirm the details with the plan. Each plan has its own list of covered drugs and coverage rules. Confirm coverage and cost, then check prior authorization, step therapy and quantity limits.

Find your break-even point

Once you have real estimates, treat a pricier plan as something that has to earn its premium. In this example, the extra $25 a month adds up to $300 a year, so the higher-premium option only wins if it lowers your yearly drug spending by more than $300.

Put simply, net savings equal the drug-spending reduction minus $300. With no savings at the pharmacy, you are $300 behind; with $150 in savings, you are still $150 behind. At $300 you break even, at $450 you are $150 ahead, and at $600 you are $300 ahead. The lower-spending profile above saves only $60 on drugs and ends up $240 behind; the higher-spending profile saves $480 and finishes $180 ahead.

This is a conditional calculation, not a prediction about any plan. Its value is the question it hands you: do your real estimates clear that bar comfortably, or only barely?

What a drug estimate leaves out

Even a careful drug-cost comparison is not a health care budget. It leaves out your Part B premium, any Medigap premium, and what you might pay for doctor visits, hospital care, tests, or equipment. It is also an estimate. If a prescription changes in the spring, the math changes with it.

Medicare Advantage plans with drug coverage combine medical and drug benefits, so a drug-cost comparison alone cannot settle that choice. Before choosing one, ask the plan whether your doctors and hospitals are in its network, whether services you expect to need require approval in advance, and how much you could owe for medical care in a difficult year.

Moving from Medicare Advantage back to Original Medicare calls for extra care. Medicare notes that you may need a separate drug plan and may want Medigap, which has limits on when you can buy it. The federal six-month Medigap Open Enrollment Period begins the first month you have Part B and are 65 or older, and it happens only once. Outside it, an insurer may use medical underwriting unless a guaranteed-issue protection applies, though your state may offer additional rights. Find out what you can buy before dropping the coverage you have.

If affording prescriptions is a concern, Extra Help can lower Part D premiums, deductibles, and other drug costs for people with limited income and resources. Some people qualify automatically, and others apply. The same Medicare page points to your State Health Insurance Assistance Program (SHIP) for free help, including with the application.

Before December 7

Write down every prescription with its exact strength, dose, quantity, and refill schedule, plus the pharmacy you use. Enter that list in Plan Finder for 2027, and line up your current plan against two or three alternatives on premiums plus estimated drug costs. Then call the plan you’re leaning toward and confirm the coverage details behind its number. If the gap is small, the things a drug estimate can’t measure may deserve the deciding vote.