The news coming out of Washington, D.C., regarding Medicare isn’t exactly the kind of thing anyone would wrap up with a bow and slide under the tree. In classic government fashion, officials insist they “won’t cut Medicare benefits,” yet somehow the math on the ground is telling a different story. Legislative tweaks, payment adjustments, and shifting plan offerings are quietly leading to higher costs and shrinking supplemental benefits for many retirees in 2026 and beyond.
It’s a bit like being told your favorite restaurant hasn’t raised prices—only to notice the portions are mysteriously smaller and the bread basket no longer arrives unprompted.
These pressures on the Medicare program suggest that bigger changes may be on the horizon. And as much as we’d love to bend the laws of economics—or Congress—we can’t. The Plan cannot shield participants from either the effects of or costs resulting from federal policy shifts; however creative we might wish to be. Ultimately, the levers that control that are in the hands of voters and elected officials—so your engagement truly counts.
Here’s the landscape as we see it, served straight, with just a pinch of perspective:
Increased Premiums and Deductibles: Standard Medicare Part B premiums are rising to $202.90 (up from $185), and the annual deductible jumps to $283 (up from $257). Part A deductibles and copayments are up as well. It’s the kind of arithmetic that makes wallets wince quietly in the corner.
Medicare Advantage (MA) Plan Adjustments: Major insurers are preparing to tighten their belts for the 2027 plan year—reducing not only the number of plans they offer, but also adjusting the benefit designs and the costs associated with them. Many Medicare Advantage (MA) and Part D plans are reported as being scaled back in response to financial pressures and anticipated shifts in federal funding. As a result, by this time next year some retirees may find that there are fewer plan options available, along with more modest supplemental benefits—such as scaled-back gym programs or smaller over-the-counter allowances.
As we shared during the educational meeting, group plans are also feeling the strain. They are increasingly being asked to absorb the shortfalls created by short-term decisions from insurance carriers with higher premiums. Finding a single group plan that meets the diverse needs of all participants, while remaining affordable, is becoming more difficult—and in some cases, may no longer be feasible.
Because of this, it may be determine that the individual marketplace offers the most tailored and cost-effective solutions for each participant’s personal needs. That is not a given, and we are certainly not stating that this will happen. All we are stating is that, for now, we’re watching these developments closely. Time will tell how the landscape settles, and we’ll continue to keep you informed every step of the way.
Provider Payment Cuts: The federal government is continuing to trim payments to physicians and hospitals. Providers warn this could eventually make access to care a little trickier—like showing up at a restaurant and finding your favorite dish “temporarily unavailable.”
Inflation Reduction Act (IRA) Provisions: Not all news is grim. The IRA brings a few sweet spots: negotiated drug prices for the first 10 high-cost Part D drugs starting in 2026, a $35 monthly cap on insulin, and $0 cost-sharing for recommended vaccines. A small gift amidst the storm.
Potential Future Cuts (PAYGO): A statutory "pay-as-you-go" law could force across-the-board cuts to Medicare and other programs if Congress doesn’t offset new spending or tax reductions. In other words, the bigger picture may still have some plot twists.
In short: the landscape is changing. Expect some things to cost a bit more and expect some benefits offerings to be slimmer—in 2026 and beyond. That said, there are glimmers of relief in the form of the inflation reduction act. Glimmers being the operative word.
Here’s the good news: the levers of change are in your hands. Your vote, your health choices, and the way you plan for the future truly matter. Obviously, the Funds can’t wave a magic wand to stop every federal shift, or the effects of them—but that’s not a reason to worry. Think of this as a friendly reminder: stay curious, make thoughtful choices, and take charge of the things you can control. After all, a little preparation and awareness can go a long way—and who doesn’t love feeling a bit clever about their own future?