Medicare Open Enrollment 2027: What Retirees Need to Know About Costs, Coverage, and IRMAA

Medicare Open Enrollment is underway, and for retirees it is about more than picking a plan. Your income can change what you pay for Medicare, sometimes by thousands of dollars a year, and the decisions that drive that income (IRA withdrawals, Roth conversions, required distributions) are made months or years before the bill arrives. This guide covers the dates, what CMS is projecting for 2027, how Medicare Advantage and Original Medicare differ, and how IRMAA works, in plain English.

Medicare Open Enrollment 2027: The Key Dates

• October 15 through December 7, 2026: the annual Medicare Open Enrollment period for 2027 coverage.
• What you can do: switch between Original Medicare and Medicare Advantage, change Medicare Advantage plans, or join, drop, or change a Medicare Part D prescription drug plan.
• When changes take effect: generally January 1, 2027.

Your plan should send an Annual Notice of Change (ANOC) in the fall that spells out what is changing in your current plan's costs and coverage for next year. Read it, because plans can change premiums, networks, drug lists, and copays from year to year.

What CMS Is Projecting for 2027

CMS has released national projections for 2027. It's important to separate those from your plan's actual price, because national averages blend thousands of plans and don't predict any single bill.

• Medicare Advantage: CMS projects the average monthly Medicare Advantage premium will be about $12.00 in 2027, down from $14.37 in 2026. CMS also projects that more than 99% of people with Medicare can choose at least one Medicare Advantage plan.
• Part D (stand-alone drug plans): CMS projects the average stand-alone Part D premium at about $36 a month in 2027, compared with $35.09 in 2026. The Part D base beneficiary premium for 2027 is $41.33, and the Inflation Reduction Act limits how fast that base premium can grow (6% a year through 2029).
• Premium stabilization demonstration: CMS is ending the Part D Premium Stabilization Demonstration after 2026. Individual stand-alone drug plans may therefore see larger premium changes than the national average suggests, which is one more reason to compare your plan's actual 2027 premium.
• Part B (outpatient care): the standard Part B premium is $202.90 a month in 2026. The 2026 Medicare Trustees Report projects roughly $209.50 for 2027, but that is a projection, not the official amount. CMS announces the official 2027 premium and the IRMAA income thresholds later in the fall, so confirm the final figures on Medicare.gov.

The takeaway: a low or falling national average doesn't mean your premium is falling. The only number that matters for your budget is your specific plan's 2027 cost.

Medicare Advantage vs. Original Medicare

This is the biggest choice many retirees make each fall, and neither option is right for everyone.

If you're happy with your current setup, it is still worth comparing, because networks, formularies, and premiums change each year. If you're leaning toward switching, consider your doctors, your prescriptions, and how easily you could switch back.

Prescription Drug Coverage and Part D

Part D has changed a lot in recent years. There is now an annual out-of-pocket cap on covered Part D drug costs (set at $2,000 in 2025 and indexed to inflation after that), which helps people with high drug costs. At the same time, premiums for stand-alone plans have been volatile. Review your plan's formulary against your actual prescriptions every year, since a drug that was covered last year can move tiers or drop off the list.

What Is IRMAA?

IRMAA stands for Income-Related Monthly Adjustment Amount. It is a surcharge added to your Medicare Part B and Part D premiums if your income is above certain thresholds. Most people pay the standard premium, but higher-income retirees pay more.

Two details trip people up:

• It looks back two years. Social Security generally uses the tax return from two years earlier. Your 2027 premiums are based on your 2025 income, and anything you do in 2026 (including a Roth conversion) can show up in your 2028 premiums.
• It works in tiers, with cliffs. Cross a threshold by a single dollar and you move into the next premium tier for the whole year.

The measure used is modified adjusted gross income (MAGI): your adjusted gross income plus tax-exempt interest. For reference, here are the 2026 Part B tiers (based on 2024 income). The 2027 thresholds are adjusted each year, so treat this as an illustration of how the tiers work, not next year's numbers.

Part D carries its own IRMAA surcharge on top of your plan premium. Married filing separately uses different thresholds.

How Retirement Income Can Affect Your Medicare Premiums

Anything that raises your MAGI in a given year can push you toward a higher tier two years later. The usual suspects:

• Traditional IRA and 401(k) withdrawals, including required minimum distributions (RMDs). See our guide to annuities and RMDs.
• Roth conversions. The converted amount is added to your income for the year. Our Roth conversion with an annuity post and the Roth conversions overview explain how conversions work.
• Capital gains, interest, and dividends from taxable accounts, and the taxable part of Social Security benefits.
• Withdrawals of earnings from non-qualified annuities, which are generally taxed as ordinary income when taken. Interest inside a deferred annuity generally isn't taxed until you withdraw it, which can give you some control over when income shows up.

Qualified withdrawals from a Roth IRA, by contrast, are generally not counted in MAGI. That is one reason some retirees like having money in more than one tax bucket. See how annuities are taxed for the basics.

A Simple Hypothetical: A $100,000 Roth Conversion

Imagine a retired couple with a MAGI of $200,000 from Social Security, pension income, and IRA withdrawals. They're under the first joint threshold, so they pay the standard Part B premium. Then they convert an extra $100,000 from a traditional IRA to a Roth IRA.

This is a hypothetical that applies the 2026 thresholds for illustration. It also leaves out the Part D surcharge, which would add to the total, and the income tax on the conversion itself, which is usually the bigger cost. The point isn't that conversions are bad, since many retirees still find them worthwhile. It's that the Medicare effect is a real, often overlooked cost to include when you model one, and that spreading a conversion over several years can sometimes keep you under a tier.

If Your Income Drops: Requesting an IRMAA Adjustment With Form SSA-44

Because IRMAA looks back two years, the income it uses may be higher than your income today. If you've had a qualifying life-changing event that reduced your income, you can ask Social Security to use a more recent year. Events listed by the Social Security Administration include marriage, divorce, the death of a spouse, a loss of income (such as retiring or reducing work), and an employer settlement payment.

You do this by filing Form SSA-44 (Medicare Income-Related Monthly Adjustment Amount: Life-Changing Event) along with supporting evidence. SSA accepts it online, by mail or fax, in person, or by phone at 1-800-772-1213. Choosing to do a Roth conversion isn't a life-changing event, so don't count on SSA-44 to undo one. Details and the full list of qualifying events are on the SSA's lower-IRMAA page.

Before December 7: A Practical Checklist

• ☐ Read your Annual Notice of Change and compare your current plan's 2027 premium, deductible, copays, and drug list.
• ☐ Check that your doctors, hospitals, and pharmacies are still in network if you're on Medicare Advantage.
• ☐ Run your actual prescriptions through the Medicare plan finder on Medicare.gov.
• ☐ Look at your IRMAA tier on your Medicare premium notice, and note which tax year it used.
• ☐ If your income has dropped because of a qualifying event, ask about Form SSA-44.
• ☐ Before any 2026 Roth conversion or large IRA withdrawal, estimate where it would put your MAGI. Remember it can affect premiums two years from now.
• ☐ Confirm the official 2027 Part B premium and IRMAA thresholds on Medicare.gov once they're announced.

Where Healthcare Fits in Your Retirement Income Plan

Healthcare is one of the larger and less predictable expenses in retirement, and Medicare premiums are only part of it. Deductibles, copays, prescriptions, and dental or vision costs add up, and they tend to rise with age. A common way to plan for this is to pair the income sources that vary (portfolio withdrawals, Social Security timing) with a base of income that doesn't, so that core expenses, healthcare included, are covered even in a down market.

That is where guaranteed income tools can help. A MYGA provides a fixed, guaranteed interest rate for a set term, and an income annuity can turn a lump sum into a guaranteed stream. Both come with trade-offs (surrender charges, limited liquidity, and the claims-paying ability of the carrier), which is why it helps to compare. Our guides on guaranteed lifetime income and the best age to buy an annuity are good places to start.

Sources

• Medicare.gov
• CMS: Medicare Advantage and Medicare Prescription Drug Programs Expected to Remain Stable for 2027
• CMS: Medicare Part D 2027 National Average Monthly Bid Amount Information
• Social Security Administration: Request to lower your IRMAA

Figures are national projections or 2026 amounts used for illustration, and are subject to change. The official 2027 Part B premium and IRMAA thresholds are announced by CMS later in the fall. The Roth conversion example is hypothetical, applies 2026 thresholds, and is not a projection or a recommendation. Annuity Radar does not offer Medicare plans or enrollment services and this article is for educational purposes only. It is not tax, legal, or medical advice, so consult a qualified tax professional about your situation. Guarantees are backed by the claims-paying ability of the issuing insurance carrier.