Medicare’s annual enrollment window is open now and closes December 7. What you can change, and when.
This article is for general educational purposes only and is not insurance or medical advice. We are not affiliated with the U.S. government or Medicare. For official information, visit Medicare.gov or call 1-800-MEDICARE. See our Medical & Financial Disclaimer for details.
“$0 premium” is the number everyone looks at first, and it’s the least useful one. Deductibles, copays, coinsurance and your out-of-pocket maximum all matter more, and in a bad year one of them matters enormously. Here is every cost component with 2026 figures, so you can work out what a plan would actually cost you rather than what it advertises.
The Quick Answer
- Average Medicare Advantage premium for 2026: $14.00/month, down from $16.40 in 2025 — and many plans charge $0
- You pay Part B either way: $202.90/month standard for 2026
- Every plan must cap your annual exposure, at no more than $9,250 in network — this is the number to compare between plans
- The premium is the smallest variable. The gap between two plans’ out-of-pocket limits can be thousands of dollars; the gap between their premiums is usually a few dollars a month
The Four Things You Pay
1. The monthly premium
What you pay the insurer for the plan, separate from your Part B premium. The 2026 average is about $14 a month, and it fell from $16.40 in 2025 — an unusual direction. Many plans charge nothing at all, though a $0-premium plan is not a free plan. It’s a plan that collects from you somewhere else.
2. The deductible
Some plans apply a deductible before certain coverage begins, often for prescriptions or particular services; others have none. A plan with no deductible usually recovers it through a higher premium or higher copays, so “no deductible” is a design choice rather than a gift. Check the specific plan’s Summary of Benefits rather than assuming, because there’s no standard structure here.
Drug deductibles are capped separately: the most any plan can charge for 2026 is $615.
3. Copays and coinsurance
What you pay each time you use a service. A copay is a flat fee — $20 for a primary care visit, say. Coinsurance is a percentage: at 25% coinsurance you pay a quarter of the bill.
The difference matters more than it looks. A flat copay tells you what a visit costs before you go; a percentage doesn’t, because you don’t know the bill in advance. Medicare Advantage plans tend to use flat copays for routine care, which is a genuine advantage over Original Medicare’s 20% coinsurance for day-to-day predictability. Out-of-network copays and coinsurance are higher, which is why network fit is a cost question and not just a convenience one.
4. The out-of-pocket maximum
This is the number that decides what a catastrophic year costs you, and every Medicare Advantage plan is legally required to have one. For 2026 a plan’s limit may not exceed $9,250 for in-network care, or $13,900 once out-of-network care is included. Once you reach it, the plan covers 100% of your covered Part A and Part B costs for the rest of the calendar year, and the counter resets every January 1.
Two limits on that protection are worth knowing. It doesn’t include your premiums, and it doesn’t include prescription drugs, which have their own separate $2,100 annual cap for 2026.
And $9,250 is the legal ceiling, not the typical figure. The enrollment-weighted average in-network limit across Medicare Advantage in 2026 is $5,421. Two plans sitting side by side on the same comparison page, both showing $0 premium, can differ by several thousand dollars here. That is the comparison worth making, and it’s the one the advertising doesn’t invite you to make.
What the Costs Look Like for 2027: Our Count
The figures above are the 2026 rules. The plans you are choosing now are 2027 plans, and CMS has already published every one of them in its plan file. We counted the ordinary plans open to anyone (no special needs or employer plans): 3,753 for 2026 and 3,553 for 2027. Three of the four costs moved, and not in the same direction.
| In-network out-of-pocket limit | Share of plans, 2026 | Share of plans, 2027 |
|---|---|---|
| $3,400 or less | 13.6% | 10.9% |
| $3,401 to $5,000 | 26.3% | 20.4% |
| $5,001 to $7,000 | 40.1% | 29.1% |
| Above $7,000, below the legal maximum | 11.0% | 28.8% |
| At the legal maximum ($9,250 in 2026, $9,850 in 2027) | 9.0% | 10.8% |
| Median limit | $5,900 | $6,600 |
Our own count from the CMS CY2026 and CY2027 Landscape files, each plan counted once.
The cap moved up the most. The share of plans with a limit above $7,000 almost doubled, from one in five to two in five, and the typical limit rose by $700. That is the cost that decides a bad year, and it is the one that grew.
The premium barely moved. 77.2% of ordinary plans charge no Part C premium for 2027, against 82.0% for 2026, and the plans that do charge one average $48.57 a month. Across all Medicare Advantage members, CMS expects the average premium to fall from $14.37 to $12.00 a month for 2027. A lower average premium next to a higher typical cap is the pattern this whole article warns about.
The drug deductible jumped. The legal maximum rose from $615 to $700, and among ordinary plans with drug coverage the typical deductible went from $440 to $650; only 10.5% of them have no drug deductible for 2027, down from 16.1%. The annual cap on covered drug costs rises from $2,100 to $2,400. Our article on Part C and Part D has the full drug-cost breakdown.
Put together: for 2027 the monthly bill looks the same or slightly lower, and the bill for the year you get sick is higher. Compare caps and drug deductibles, not premiums, and you will see the change that matters.
Why the Cap Exists: What Original Medicare Leaves Open
Original Medicare has no annual limit on what you can be asked to pay. Not a high one — none. These are the 2026 hospital figures:
| Part A hospital costs, 2026 | What you pay |
|---|---|
| Deductible, per benefit period | $1,736 — and a benefit period can start again within the same year if you’re readmitted |
| Days 1–60 | $0 after the deductible |
| Days 61–90 | $434 per day |
| Days 91 and beyond | $868 per day, using lifetime reserve days — you get 60 of them, ever |
| Part B services | 20% coinsurance, with no annual limit |
Put a real stay through that. A hundred days in the hospital costs $1,736 for the deductible, $13,020 for days 61 to 90 at $434 a day, and $8,680 for days 91 to 100 at $868 a day. That is $23,436 in hospital charges alone, before one doctor’s bill, and the 20% Part B coinsurance on everything else keeps running with no ceiling above it.
That exposure is the reason both Medicare Advantage and Medigap exist. They solve it differently — Medicare Advantage by capping your annual spend, Medigap by covering the cost sharing itself — but they are answers to the same question.
Comparing the Two Paths Honestly
You’ll find plenty of articles giving a monthly cost range for Original Medicare with a Medigap policy. Treat those with suspicion, because Medigap pricing can’t be averaged into a useful number.
Identical Plan G coverage can carry very different premiums depending on your state, your age, and which of three pricing methods the insurer uses, a distinction we set out in our guide to choosing a Medicare Supplement policy. A range that ignores all of that tells you nothing about what you’d pay. The only figure that means anything is a quote for your own ZIP code and age.
What can be said cleanly is where each path puts your money:
| Medicare Advantage | Original Medicare + Medigap + Part D | |
|---|---|---|
| Monthly | $202.90 Part B, plus the plan premium — often $0, averaging $14 | $202.90 Part B, plus a Medigap premium that varies widely, plus a Part D premium |
| When you use care | Copays and coinsurance until you reach the plan’s cap | Little or nothing beyond the $283 Part B deductible, with Plan G |
| Worst case in a year | Your plan’s out-of-pocket maximum — check the figure, it varies | Essentially the Medigap premium you already paid |
| You’re paying for | Low fixed cost, with variable cost when ill | High fixed cost, with near-zero cost when ill |
Neither is cheaper in the abstract. Medicare Advantage costs less in a healthy year and more in a bad one; Medigap does the reverse. Which is better depends on a year you can’t see yet, which is why the comparison is genuinely hard and why anyone who tells you one is simply cheaper is skipping the question. Our full comparison works through it properly.
If Your Income Is Higher: IRMAA
Whichever path you take, income above a threshold adds a surcharge to your Part B and Part D premiums — the Income-Related Monthly Adjustment Amount. For 2026 it starts above $109,000 for an individual and $218,000 filing jointly, and it’s assessed on income reported two years earlier. It changes what you pay, never whether you can enroll.
What to Check Before Enrolling
- The plan’s exact out-of-pocket maximum — the dollar figure, not just that one exists. Start here, not with the premium.
- Copays for the visits you actually make — primary care, your specialists, the emergency room.
- Whether there’s a deductible, and which services it applies to.
- Your own medications against the plan’s formulary, by name and dose — that cap is separate from your medical one.
- The in-network versus out-of-network difference, if there’s any chance you’ll need a provider outside the network.
- The premium — last, because it’s the number least likely to decide what the year costs you.
Frequently Asked Questions
Is a $0 premium plan really free? No. You still pay the $202.90 Part B premium, and you pay copays, coinsurance and any deductible when you use care, up to the plan’s out-of-pocket maximum. The premium is one of four things you pay, and the smallest.
Two plans both show $0 premium. How do I choose? Compare their out-of-pocket maximums first, then their copays for the care you actually use. The average in-network limit is $5,421 and the legal ceiling is $9,250 — two $0-premium plans can sit a long way apart inside that range.
Does the out-of-pocket maximum include my premium or my drugs? Neither. It covers Part A and Part B cost sharing only. Prescription drugs have their own $2,100 annual cap for 2026.
Why did the average Medicare Advantage premium fall for 2026? It dropped to $14.00 from $16.40, which is an unusual move. Worth noting alongside it: the number of plans available fell, so a lower average premium doesn’t automatically mean a better market.
What’s the real risk of Original Medicare on its own? That there’s no ceiling. A hundred-day hospital stay comes to $23,436 in Part A charges alone at 2026 rates, and the 20% Part B coinsurance on everything else continues with no annual limit.
Bottom Line
Sort the four costs by how much they can move, and the premium comes last. It varies by a few dollars a month between plans. The out-of-pocket maximum varies by thousands, and it’s the number that decides what happens to you in the year you need the insurance.
So compare the caps first, the copays for your own care second, and the premium last — the same order we would give anyone choosing their first plan. And when someone quotes you a tidy monthly figure for Medigap, ask which pricing method it’s based on and how it behaves at 80 — because that’s a question the number alone can’t answer.
The only costs worth comparing are the ones attached to plans sold at your own address, and the official Medicare Plan Finder puts them side by side once you enter your ZIP code and your medications. If the results are hard to read against each other, a State Health Insurance Assistance Program counselor will go through them with you for nothing.
Sources
- 2026 Medicare Parts A & B Premiums and Deductibles — Centers for Medicare & Medicaid Services. Source for the $202.90 Part B premium, the $283 Part B deductible, the $1,736 Part A deductible, the $434 and $868 daily coinsurance rates, and the $109,000 and $218,000 IRMAA thresholds.
- Medicare Advantage and Medicare Prescription Drug Programs Expected to Remain Stable in 2027 — Centers for Medicare & Medicaid Services, September 28, 2026. Source for the average Medicare Advantage premium falling from $14.37 to $12.00 for 2027. The $700 maximum drug deductible and $2,400 drug cap for 2027 are the figures listed for every 2027 plan in the CMS plan file.
- Medicare Advantage and Medicare Prescription Drug Programs Expected to Remain Stable in 2026 — Centers for Medicare & Medicaid Services. Source for the $14.00 average Medicare Advantage premium in 2026 and the $16.40 figure for 2025.
- Final CY 2026 Part D Redesign Program Instructions — Centers for Medicare & Medicaid Services. Source for the $615 maximum Part D deductible and the $2,100 annual out-of-pocket cap for prescription drugs.
- Medicare Advantage in 2026: Premiums, Out-of-Pocket Limits, Supplemental Benefits and Prior Authorization — KFF. Source for the $9,250 in-network and $13,900 combined limits and the $5,421 enrollment-weighted average in-network limit.
All figures on this page were checked against the sources above on September 16, 2026. The $23,436 hospital scenario is calculated from the 2026 Part A deductible and coinsurance rates published by CMS. The 2027 section is our own count from the CY2027 and CY2026 Landscape files, added on October 18, 2026.
Disclaimer: Costs and figures mentioned in this article reflect 2026 data from the Centers for Medicare & Medicaid Services (CMS) and KFF analysis, and are subject to change. Always confirm current details directly with Medicare.gov, 1-800-MEDICARE, or a licensed agent before making a decision.
Unai Sampedro founded and edits Medicare Plan Compass. He is not a licensed insurance agent or broker and takes no commission from any insurer; the site is funded by advertising. Articles are written from CMS and Medicare.gov documents and reviewed each year when new figures are published. Nothing here is personalized advice: the goal is to explain the rules in plain language so readers can ask better questions before they speak to someone who can advise them.