Newsletter

SOCIAL SECURITY RAISE FOR 2027: 3.6%, THE BIGGEST IN FIVE YEARS

On October 14, the Social Security Administration announced a 3.6% cost-of-living adjustment (COLA) for 2027. For the average retired worker, that's about $75 more per month, raising the average benefit from roughly $2,095 to $2,170 starting in January.

This is the largest raise since 2023, though far below that year's 8.7%. It ties 2011 for the fifth-highest COLA since 1991.

What it means for Medicare beneficiaries: Most people have their Part B premium deducted from their Social Security check, so the raise you actually see depends on next year's Part B premium. CMS hasn't announced it yet, but the Medicare Trustees project $209.50 a month, up $6.60 from $202.90. If that holds, the average retiree would keep about $68 of the $75 raise. 

What to do: Nothing is required; the increase is automatic. Your personal COLA notice will be available in your my Social Security account in late November, or by mail in December. Check it to confirm your new benefit and your Medicare deductions for 2027.

BUYING YOUR DRUGS FROM CANADA? A DEADLINE IS COMING JANUARY 20

If you fill prescriptions through a Canadian mail-order pharmacy, your deliveries could stop early next year. A new U.S. Customs and Border Protection (CBP) rule changes how mailed medications clear customs, and Canadian pharmacy groups warn it could block most personal prescription shipments.

The rule was originally set to take effect October 22. On October 14, CBP pushed the deadline back 90 days, to January 20, 2027. After that, each prescription package will need a formal customs filing, a customs broker and a bond. Canadian pharmacies say that process is unworkable for individual orders, especially for drugs that are also sold in the U.S.

CBP says the FDA will keep deciding case by case whether personal shipments are admissible, so the real-world impact won't be known until the rule is in force. Some Canadian pharmacies have already paused U.S. shipments rather than risk packages being stopped.

What you should do now:

• Call your Canadian pharmacy. Ask whether it is still shipping to the U.S., how it plans to handle the January 20 change, and whether any new fees will apply.

• Refill early. If your pharmacy is still shipping, order your next refill well before January 20 so it clears customs in time. FDA guidance generally limits personal imports to a 90-day supply.

• Use a licensed pharmacy. Stick with pharmacies certified by the Canadian International Pharmacy Association (CIPA) or verified by Pharmacy Checker at https://www.pharmacychecker.com.

• Line up a backup plan during annual enrollment. Annual enrollment ends December 7. Before then, check what each of your drugs, including the ones you buy from Canada, will cost under your 2027 plan, so you're covered if your Canadian supply stops.

Important: Canadian and discount-card purchases don't count toward your $2,400 cap. In 2027, once your out-of-pocket drug costs through your Medicare plan reach $2,400, you pay nothing more for covered drugs for the rest of the year. Drugs bought from a Canadian pharmacy or with a discount card like GoodRx are outside your plan, so that money never counts toward the $2,400. If you take expensive medications, buying them through your plan may get you to the cap, after which they cost you nothing. Before buying elsewhere, compare your total yearly cost both ways.

Note: this article is for informational purposes and is no way an endorsement for buying medications through overseas pharmacies or discount programs like GoodRx.

ANNUAL ENROLLMENT IS HERE: WHY THIS YEAR IS WORTH A SECOND LOOK

Medicare's Annual Enrollment Period runs from October 15 through December 7, and changes take effect January 1. If you do nothing, your current plan renews automatically, but this year that could cost you. Here's what's different for 2027.

Fewer plan choices. Nationally, the average beneficiary can choose from 35 Medicare Advantage plans, down from 39, and some insurers are leaving certain counties entirely. Plans that stay may have trimmed extra benefits like dental, vision, or over-the-counter allowances.

If your plan is leaving and you don't pick a new one by December 31, you'll default to Original Medicare without drug coverage. Note: your termination letter will say you have a special enrollment period through February 28; however, you should make an election to enroll in a new plan by December 31.

Drug cost limits are higher. The maximum Part D deductible rises from $615 to $700. Some plans will have a lower deductible, and some will have no deductible at all. The annual out-of-pocket cap rises from $2,100 to $2,400, whether your drug coverage is part of a Medicare Advantage plan or a standalone drug plan. Once you reach the cap, covered drugs cost you nothing for the rest of the year. Keep in mind that drugs bought from Canada or other foreign pharmacies or with a discount card like GoodRx don't count toward the cap, so if your medications are expensive, buying them through your plan may save you more. On the plus side, negotiated prices for 15 more high-cost drugs take effect in January.

Standalone drug plan premiums are jumping for some. A temporary federal program that held down standalone Part D premiums ends this year. Some standalone drug plans are raising premiums substantially, and there will be no $0-premium standalone drug plans in 2027 for people without Extra Help (also known as Low Income Subsidy).

Your to-do list before December 7:

• Read your Annual Notice of Change for copay, network, benefit, and drug list changes.

• Confirm your doctors, hospitals and pharmacy are still in network for 2027.

• Check what each of your prescriptions will cost under your plan in 2027. Drug lists and prices change every year.

• If you're in Medicare Advantage and change your mind between January 1 and March 31 (the open enrollment period), you get one more switch between January 1 and March 31. People in Original Medicare with or without a Medicare Supplement and/or a standalone drug don't get that second chance.

Questions about your Medicare Advantage plan? Give us a call before December 7.

About Paul Cholak

Paul is a licensed, independent health and life insurance agent and has over forty years of benefits experience and specializes in helping Medicare beneficiaries obtain health insurance. However, he offers a complete array of life and health insurance products to individuals of all ages.

He guides Medicare beneficiaries through the steps of getting insurance and is available to help clients both BEFORE and AFTER they've made their purchase decision.

Disclaimer for Part C and D plans: "We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY: 1-877-2048) to get information on all your options."

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