On April 2, 2026, the Centers for Medicare & Medicaid Services (CMS) released its final rule for Contract Year 2027, ushering in changes to Medicare Advantage (Part C) and prescription drug coverage (Part D). If you are a Michigan resident enrolled in Medicare, these updates directly affect your coverage, costs and care starting January 1, 2027.
1. Stronger Protections Against Surprise Bills
One of the most impactful changes for Michigan seniors enrolled in Medicare Advantage: plans can no longer retroactively deny a hospital stay after it has been approved. Previously, some plans approved your admission upfront, then refused to pay after discharge — leaving you with unexpected bills. Under the new rule, once a hospital stay is authorized, that approval stands (except in cases of fraud or clear error).
2. Lower Drug Costs Under Part D
Thanks to the Inflation Reduction Act of 2022, some drug costs will continue dropping in 2027. Here are some of the changes (some have already been enacted):
- The “donut hole” (coverage gap) was permanently eliminated as of 2024.
- You pay $0 out-of-pocket once you reach the annual catastrophic spending threshold for any covered medications.
- Negotiated (lower) prices take effect for a second set of 15 high-cost drugs — including GLP-1 medications Ozempic and Wegovy used for diabetes and weight management.
- A $2,100 annual out-of-pocket cap on Part D drug spending is now permanently in place — protecting you from catastrophic prescription costs.
3. Updated Star Ratings — Better Plan Comparisons
CMS is overhauling the 1-to-5 Star Rating system used to compare Medicare Advantage and Part D plans. Eleven low-value administrative measures are removed, and a new measure for Depression Screening and Follow-Up is added for 2027. When you compare plans during Open Enrollment this fall, the star ratings will more accurately reflect actual quality of care and patient experience.
4. Supplemental Benefits: More Transparency
New rules require Medicare Advantage plans to clearly post who qualifies for Special Supplemental Benefits for the Chronically Ill (SSBCI). Debit cards for supplemental benefits must be electronically verified in real time and expire at year-end. These changes reduce confusion and ensure Michigan seniors can access the dental, vision and fitness benefits they are entitled to.
Note: Agents cannot discuss 2027 plan details prior to October 1, 2026.
Action Steps Before January 1, 2027
- Review your plan during Open Enrollment (October 15–December 7, 2026).
- Ask your insurance agent which Michigan plans have higher quality ratings for 2027.
- Check whether your prescription drugs are covered at newly negotiated prices.
- Call 1-800-MEDICARE (1-800-633-4227) or visit Medicare.gov to compare your options.
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