Inside Medicare | Will I need to find a new Medicare insurance plan EVERY year now?

Janell Sluga Medicare & Individual Health Insurance Account Executive View Bio

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Question:

This is the second year in a row that my insurance plan has been discontinued. Now I have to find new insurance again! Is this going to happen every year? I am really frustrated.

Answer:

Medicare Insurance options have had a rough couple of years. The industry calls that “Significant Market Disruption.” For those individuals with those products, it feels like a significant hassle!

It is important to understand that this isn’t happening to just YOU. It is happening to individuals with Medicare all over the country. This Significant Market Disruption is caused by a number of factors. So I will try to explain some of those factors.

Probably the biggest impact in recent years to the Medicare market plan options has been the improvement to the Part D Minimum Standard Plan. Remember that last year and during this year, I have mentioned a number of times that the Maximum Out of Pocket (MOOP) was capped at $2000 in 2025. In 2026, the MOOP is $2100. This MOOP is calculated based on the money that you pay for covered medications as you pick them up at the pharmacy. This means that for many individuals on Medicare, their prescription drug costs will cap out early in the year. For individuals taking very expensive medications, they quickly hit that MOOP and had $0 in prescription costs for the rest of 2025, starting very early in the year. For individuals with even one Name Brand medication, they often saw their copays move to $0 before the end of the year.

For the insurance companies, that means they are paying a significantly higher amount of your medication costs throughout the year. That has impacted their bottom-line and the insurance industry has had to adjust their business model. That adjustment means they must shift some of the costs back to the members they are covering. As they make those adjustments, Centers for Medicare Services (CMS) has rules about how much they can increase premiums and copay structures from year to year. That rule is designed to protect you, the member. They CANNOT raise the premiums more than $50 per month. They CANNOT raise the cost share for services by a significant amount either. So, the insurance companies in reviewing plans, must take those factors into account as they readjust the cost shares.

If the insurance company finds that in making the necessary adjustments to the plan does not stay within the defined CMS parameters, they end up terminating the plan altogether. If they can make the necessary adjustments to the plan and stay within the parameters, your plan stays available, but in 2026 (like 2025), you will be paying different premiums each month, as well as different copays, and cost shares for services and medications.

The costs of healthcare keep increasing significantly, at higher percentages than the overall cost of living. Those increases are then felt by the insurance industry and the members who are paying for care. This leads to significant increases in cost to us, the individuals who are enrolled in the insurance plans and getting medical care.

Another factor impacting the Medicare Insurance industry is the simple fact that we are aging. We are getting older and living longer. The increased average lifespan, we are accessing more care, more providers, more procedures, more medications, more testing. The years of 1954 through 1964 saw more than 4 million births per year, a very significant increase over previous years. The Baby Boomers have been moving through our economy and at every stage have changed the dynamics. There are simply more of them than any other generation, and they are living longer than any generation before them. The tail end of the Baby Boomer generation is now hitting Medicare eligibility.

This Baby Boomer generation is now on Medicare. They are healthy, living active lives, and they access healthcare on a regular basis to stay healthy. This increases usage, which leads to increased costs for the insurance industry, and they find the need to adjust their service model.

Another significant factor is medical and technological advancements. We can treat diseases with amazing advancements with technology and medications. That means individuals are living through diseases and illnesses that previously were likely to cause death. We are changing the length of life and quality of life. That all costs money. That money has to come from somewhere.

When insurance companies take all these factors into consideration when adjusting their plans from year to year, they cannot always stay within the parameters that CMS has set. If the plan cannot be “adjusted” to meet the need, the plan is discontinued.

I understand your frustration, looking for insurance is not everyone’s definition of a good time. But there are many good options out there still in 2026. There are resources that you have available to you. Next week, I will be touching on those available resources. So take this time in early October to look at your options. Then, between October 15th and December 7th, you can make a change if necessary. Remember that if your plan was terminated or discontinued, you have the additional time beyond the normal enrollment period, so from December 8th to February 28th you can also pick new coverage. I would NOT recommend putting it off into 2026, because you must choose a new plan by December 31st to get new coverage that begins January 1st, 2026.