Your Medicare Letter Is Coming. Don't Toss It.

What the Annual Notice of Change actually is

The Annual Notice of Change, or ANOC, is a letter your Medicare Advantage plan or your standalone Part D drug plan sends every year. It lays out what's different about your plan for the coming year compared to this year.

That includes things like your monthly premium, your deductible, your copays, which drugs are covered and at what tier, which pharmacies are in network, and, for Medicare Advantage plans, which doctors and hospitals are in network.

In plain terms, it's the plan telling you, "Here's what we're changing. You've been warned."

Some people won't get one. If you have Original Medicare with a Medigap supplement and you don't have a standalone Part D plan, there's no ANOC coming for you from a plan. You'll still get other Medicare mailings, and your Medigap company may send its own notices, but the ANOC is specifically a Medicare Advantage and Part D document.

If you're not sure which type of coverage you have, look at the card you show at the doctor's office. If it's the red, white, and blue Medicare card only, plus a separate supplement card, you're likely on Original Medicare. If your main card has an insurance company's name on it, you're likely on a Medicare Advantage plan.

Why this year's letter matters more than usual

Most years, the changes are small. A few dollars here, a copay there. This year, a few bigger things are moving at the same time.

The Part D drug deductible is jumping

For 2027, the standard Part D deductible rises to $700, up from $615 in 2026. That's about a 14% increase, and it's the largest one-year jump since the drug benefit was redesigned.

Now, that $700 is the maximum a plan can charge. Some plans set a lower deductible, and some don't charge one at all. So the number in your letter is the one that matters, not the headline number.

The drug cost cap is going up too

There's still an annual cap on what you pay out of pocket for covered prescriptions. In 2027, that cap rises to $2,400, up $300 from $2,100 this year. Once you hit it, you pay nothing more for covered drugs for the rest of the year.

The cap is a real protection. It's just a little higher next year.

A premium subsidy for standalone drug plans is ending

This one is quieter, but it could matter a lot. For the last couple of years, a temporary federal program helped hold down premiums on standalone Part D plans. That program ends after 2026. So standalone drug plans will set 2027 premiums without that cushion.

If you're on Original Medicare with a standalone drug plan, your premium could move more than it has recently. The letter will tell you the new number.

Medicare Advantage plans are trimming benefits

Insurance industry analysts are expecting another round of benefit reductions in Medicare Advantage for 2027. One analyst note cited in the press said UnitedHealthcare appears to have dropped around 13% of its plans across 18 states. The same reporting described common cuts like removing benefits that pay part of your Part B premium, reducing dental coverage, and raising specialist copays.

I'm not telling you your plan is one of them. I don't know that, and neither does anyone else until your letter shows up. What I am telling you is that this is a year to read the letter instead of assuming nothing changed.

The Part B premium is projected to rise

The standard Part B premium is $202.90 a month in 2026. The Medicare Trustees Report projects it at about $209.50 for 2027. That's a projection, not the final number. CMS usually announces the official Part B premium in the fall, often in November.

For a lot of retirees, the Part B premium comes straight out of the Social Security check. And the Social Security cost-of-living adjustment for 2027 gets announced on October 14. So in the same few weeks, you'll learn how much your check goes up and how much of that increase Medicare takes back. Worth keeping both numbers in front of you at once.

What to check when the letter arrives

The ANOC can run a lot of pages. You don't have to read every line. But there are a handful of things worth finding and circling.

1. The premium

What will you pay each month in 2027, and how does that compare to this year? If you're in a Medicare Advantage plan that paid part of your Part B premium, check whether that benefit is still there.

2. The deductible

Find the medical deductible, if your plan has one, and the drug deductible. Remember, the drug deductible can be anywhere from $0 up to $700 depending on the plan.

3. Your specific drugs

This is the big one. Take your list of prescriptions, the actual names and doses, and find each one in the plan's drug list for next year. Check three things for each drug:

• Is it still covered?
• Did it move to a different tier? A tier change can change your cost a lot.
• Does it now need prior authorization or step therapy? That means extra hoops before the plan pays.

Let's say you take a medication that's been on a low tier for years. If it moves up a tier in 2027, your cost for that one drug could go up meaningfully, even if your premium doesn't change at all. That's the kind of thing that hides inside a letter nobody reads.

4. Your pharmacy

Is your pharmacy still in network? Is it still a "preferred" pharmacy, if your plan uses that label? Preferred pharmacies can mean lower copays.

5. Your doctors and hospitals (Medicare Advantage only)

If you're on a Medicare Advantage plan, the network matters. Check that your primary care doctor, your specialists, and the hospital you'd want to go to are still in network for 2027. The letter may not list every provider, so you may need to check the plan's provider directory or call your doctor's office and ask directly.

6. The extras

Dental, vision, hearing, gym memberships, over-the-counter allowances. These are the benefits most likely to shrink when plans tighten up. If you chose your plan partly because of one of these, confirm it's still there at the same level.

The dates that matter this fall

Here's the calendar, laid out simply.

By September 30: Your plan has to get your Annual Notice of Change to you.

October 1: Plans can start marketing their 2027 options. You'll start seeing ads, mailers, and phone calls. A lot of them.

October 15: Open enrollment begins. You can switch Medicare Advantage plans, switch drug plans, move from Medicare Advantage back to Original Medicare, or move from Original Medicare to Medicare Advantage.

December 7: Open enrollment ends. This is the deadline that matters. If you do nothing by this date, you generally stay in your current plan for 2027.

January 1, 2027: Your 2027 coverage starts, whatever you chose or didn't choose.

January 1 to March 31, 2027: If you're in a Medicare Advantage plan, there's a separate window where you can make one change, either to a different Medicare Advantage plan or back to Original Medicare. It's a safety valve, not a substitute for doing the work now.

Like I said, the one people miss is December 7. Doing nothing is a decision. It's just one you didn't make on purpose.

If your plan is leaving your area

Some people won't get a normal ANOC. If your Medicare Advantage plan is leaving Medicare or leaving your county entirely, you'll get a separate notice telling you the plan won't be available in 2027.

If that happens to you, don't panic, but don't sit on it either. You'll need to pick new coverage. If you don't, you may end up in Original Medicare without a drug plan, which is a situation a lot of people don't want to be in.

There's also a protection worth knowing about. When a Medicare Advantage plan leaves your area, you generally get what's called a guaranteed issue right to buy certain Medigap policies. That means a Medigap company can't turn you down or charge you more because of your health, as long as you apply within the time window. That window is limited, so if you get a plan exit notice, it's worth confirming your timeline with Medicare or a SHINE counselor right away.

How to actually compare plans

So the letter came, and something changed. Now what?

Make your list first

Before you look at a single plan, write down:

• Every prescription you take, with the dose and how often
• The pharmacy you use, and a backup pharmacy
• Your doctors, specialists, and the hospital you'd want
• Any procedure or treatment you know is coming next year
• What you spent out of pocket this year, if you can pull it together

That list is your filter. Without it, every plan looks about the same, and you end up choosing by premium alone. The lowest premium isn't always the lowest total cost.

Use Medicare's Plan Finder

Medicare.gov has a Plan Finder tool that lets you enter your drugs and pharmacy and compare estimated total costs across plans in your area. It's not perfect, but it's the most direct way to see the full picture instead of just the monthly premium.

If you're comfortable online, you can do this yourself in an afternoon. If you're not, that's completely fine, and there's free help.

Call SHINE

Florida has a free program called SHINE, which stands for Serving Health Insurance Needs of Elders. It's run by the Florida Department of Elder Affairs with trained volunteers who help people compare Medicare options one on one. It's free, it's unbiased, and they don't sell anything.

You can reach SHINE at 1-800-963-5337 or at floridashine.org. Bring your list. They'll get more done for you in an hour with a good list than in three hours without one.

You can also call Medicare directly at 1-800-633-4227.

Be careful with the phone calls

Starting October 1, you'll get calls about Medicare plans. Some are legitimate. Some are not. Nobody from Medicare is going to call you out of the blue asking for your Medicare number. If someone does, hang up and call Medicare yourself at the number on the back of your card.

A few things that stay the same

Not everything is changing. A few protections carry into 2027:

• Covered insulin is still capped at $35 a month.
• Recommended adult vaccines covered under Part D are still $0.
• There's still no coverage gap, or "donut hole," in Part D.
• Every Part D plan still has to offer an option to spread your drug costs across the year in monthly payments instead of paying a big amount all at once early in the year.

That last one is worth knowing. Let's say you take an expensive medication and would hit the $2,400 cap in January. Instead of paying that all up front, you can choose to spread it out over the year. If you have a big drug bill and a fixed income, that can make a real difference in how the year feels.

Where Medicare fits in your retirement budget

This is the part I care most about, because it's where Medicare stops being an insurance question and becomes a money question.

A lot of people plan their retirement income down to the dollar and then treat health care as whatever it turns out to be. But health care costs in retirement aren't random. The premium is fixed. The deductible is fixed. The out-of-pocket cap is fixed. You can actually plan around most of it.

So when the letter comes, I'd put three numbers side by side:

1. Your total premiums for 2027. Part B, plus your Advantage or drug plan premium, plus any Medigap premium.
2. Your realistic out-of-pocket costs. Based on what you actually used this year and what you expect next year.
3. Your worst case. Your plan's out-of-pocket maximum for medical, plus the $2,400 drug cap if you're on a drug plan.

That worst-case number is the one that belongs in your emergency planning. If you had a bad health year, could you cover it without selling investments at a bad time or running up a credit card? If the answer is no, that's worth knowing now, in September, not next August.

Higher income can mean higher premiums

If your income is above certain levels, you pay more for Part B and Part D. It's called IRMAA, the Income-Related Monthly Adjustment Amount. Medicare generally looks at your tax return from two years earlier, so your 2027 premiums are generally based on your 2025 income.

That matters for people who had a one-time spike in income. Let's say you took a big lump sum from a retirement account, or sold something with a large gain, in 2025. That could push your 2027 Medicare premiums up, even if your normal income is lower. If your income dropped because of a life change like retirement, there's a process to ask Social Security to use more recent income. It's worth looking into if it applies to you.

I'll go deeper on IRMAA in a separate article, because it catches a lot of people off guard.

A note for FRS retirees

If you retired under the Florida Retirement System, you may be receiving the Health Insurance Subsidy, a monthly payment that helps offset health insurance costs, including Medicare-related premiums. The amount is based on your years of creditable service, within a set minimum and maximum. If you're not sure whether you're receiving it, or whether you applied for it, it's worth checking with the Division of Retirement.

The HIS doesn't change your Medicare choices. But it's part of your health care budget, and it belongs on the same page as the numbers above.

What I'm not going to do

I'm not going to tell you which Medicare plan to pick. I don't sell insurance, and plan choice depends on your drugs, your doctors, your health, and where you live. That's exactly what the Plan Finder and SHINE are built for.

And I'm not going to tell you that Medicare Advantage is better than Original Medicare, or the other way around. Both work well for some people and poorly for others. Anyone who tells you one is always the right answer is selling something.

What I will tell you is this. When it comes down to it, the people who get hurt by Medicare changes usually aren't the people who picked the "wrong" plan. They're the people who didn't open the letter.

The short version

• Your Annual Notice of Change arrives by September 30. Open it.
• Circle the premium, the deductible, your drugs, your pharmacy, and your doctors.
• The Part D deductible can go as high as $700 in 2027, and the drug cap rises to $2,400.
• A premium subsidy for standalone drug plans ends, and many Medicare Advantage plans are trimming benefits.
• Open enrollment runs October 15 to December 7. Doing nothing keeps you where you are.
• Florida's SHINE program offers free, unbiased help at 1-800-963-5337.

If you want to see how your 2027 Medicare costs fit into the rest of your retirement income, that's the kind of thing I help people with every week. No pressure, and no plan to sell you.

Frequently asked questions

When will I get my Medicare Annual Notice of Change for 2027?

Medicare Advantage and Part D plans have to get the Annual Notice of Change to their members by September 30, 2026. If you haven't received it by early October, call your plan.

What happens if I don't do anything during Medicare open enrollment?

If you're in a Medicare Advantage or Part D plan that's continuing in 2027, you generally stay in that same plan next year, on its 2027 terms. If your plan is leaving your area, you'll get a separate notice and will need to choose new coverage.

What is the Part D deductible for 2027?

The standard Part D deductible for 2027 is $700, up from $615 in 2026. That's the maximum. Many plans charge less, and some charge no deductible.

What is the Medicare Part D out-of-pocket cap for 2027?

The annual out-of-pocket cap on covered prescription drugs is $2,400 in 2027, up from $2,100 in 2026. After you reach it, you pay nothing more for covered drugs that year.

What will the Medicare Part B premium be in 2027?

The official 2027 Part B premium hasn't been announced yet. The Medicare Trustees Report projects about $209.50 a month, up from $202.90 in 2026. CMS typically announces the final figure in the fall.

Where can I get free help comparing Medicare plans in Florida?

Florida's SHINE program offers free, unbiased Medicare counseling through trained volunteers. Call 1-800-963-5337 or visit floridashine.org.

Educational content only. Not individualized investment, tax, legal, or insurance advice. Benowitz Wealth Management is a brand of Joy Financial Group LLC, a Florida state-registered investment adviser. Joy Financial Group LLC does not sell insurance. Consult a qualified tax professional regarding your specific situation.

Neither Joy Financial Group LLC nor Benowitz Wealth Management is affiliated with, endorsed by, or employed by the Florida Retirement System, the Florida Division of Retirement, the State Board of Administration of Florida, MyFRS, or any government agency. FRS members may obtain free, unbiased guidance from the MyFRS Financial Guidance Line at 1-866-446-9377.