The U.S. government is preparing several adjustments concerning Social Security programs, Medicare and Medicaid by 2026. It might seem a bit complicated to understand these changes, but it’s important to know about them because it will directly affect your pockets and the wellbeing of millions of Americans. So, let’s learn more about these changes, shall we?
Higher Social Security and Medicare costs
One of the first changes you must know is that the increment you will receive on your Social Security payment due to the cost of living adjustment will be reduced since Medicare will be more expensive. In 2026, the standard monthly premium for Medicare Part B will rise by 9.7%.
This means that the premium will go from $185 to $202.90 per month. Because this payment is taken directly out of your Social Security check, the increase in premium will take away a part of the money you were expecting to gain from the COLA.
Higher annual limit for prescription drugs
For those who have the Part D of Medicare, which covers prescription medications, there will also be a change in 2026. The annual limit you must pay will increase from$2,000 to $,200.
When you reach that limit, Medicare will pay the rest of the cost of your medications for the rest of the year. Even though the increment is not that much, it does represent an additional expense for many people who need medication on a daily basis.
Increase in the part D deductible
Apart from the annual limit, what will also increase is the Part D deductible which will go from $590 to $615. In other words, before Medicare starts covering your medications, you must pay that amount from your own pocket. After that, you will continue paying until reaching the $2,100 limit; only then Medicare will begin to cover drugs with a 25% coinsurance.
Financial risks related to medical debt
Before these changes, there was a rule that prevented this type of debt from appearing on your credit report. However, a recent court decision removed that protection, meaning that:
- Medical debt can once again appear on your credit report.
- If you do not pay your medical bills, they may be sent to a collection agency.
- Your credit score may drop, making it harder to get loans, credit cards, or rent a home.
Unless this decision is reversed, the medical debt can have a negative impact on many people’s financial lives.
Change from Medicare Advantage to the traditional one?
If you have a Medicare Advantage plan and you decide to change again to the traditional Medicare, you could experience some difficulties obtaining a Medigap plan (which helps cover what Medicare doesn’t pay).
So, depending on the laws of the state you live in it could be more difficult to find an available Medigap plan, and the cost could be way higher.
What’s more, when going back to a traditional Medicare you have to choose a new Part D prescription drug plan.
Copays and cuts in Medical programs
A federal cut will affect the amount of money the states receive for Medicare, which could lead the states to:
- Reducing coverage for some medical services.
- Removing certain benefits.
- Increasing the amount of money states must spend.
- Adding copays for people who earn above the poverty level in 2026 or 2027.
These changes vary depending on the state you live in.
People buying their own insurance
One of the biggest changes for 2026 is the possible loss of financial aid for those buying their own health insurance through the marketplace (healthcare.gov). This aid includes:
- Discounts on monthly premiums.
- Tax credits to lower insurance costs.
If the government does not take action to extend this assistance, it will disappear. People who depend on these discounts may suddenly face much higher insurance costs. So, those who rely on this help should contact their representatives to express their concerns.