More than half of Medicare beneficiaries nationwide—about 54%, or roughly 34 million people—choose Medicare Advantage (also called Medicare Part C) for their health coverage. In New Hampshire, around 120,000 people were enrolled in Medicare Advantage plans as of September 2024.

What Medicare Advantage Covers

Medicare Advantage plans are offered by private insurance companies approved by Medicare and combine all the benefits of Original Medicare Parts A (hospital insurance) and B (medical insurance), often including Part D prescription drug coverage. Additionally, many plans offer extras like dental, vision, hearing, wellness programs, and even transportation or over-the-counter allowances, depending on the plan and location.

Differences in Plans

These Advantage plans differ by cost, coverage, and provider networks, with options like HMOs, PPOs, and Special Needs Plans tailored for specific health needs. On cost, while some plans have low or $0 premiums, beneficiaries still pay their Medicare Part B premium. But, unlike Original Medicare, Medicare Advantage plans have an annual out-of-pocket maximum for added financial protection.

Why Your Medicare Plan May Have Changed or Been Dropped

So, why might your plan have changed or been dropped? Several factors contribute, including rising healthcare costs, increased use of medical services, legislative changes, and more recently, tariffs affecting supply chains.

Rising Healthcare Costs

Over the past decade, healthcare costs that generally rose about 4.4% per year, spiked during the COVID-19 pandemic (10+%), and surged again with a 7.5% increase from 2022 to 2023 due to greater use of hospitals, physician services, and more expensive prescription drugs. Simply put, more people are using the health care system, more frequently, for increasingly more expensive care.

Legislative Changes: Inflation Reduction Act

As these healthcare costs were increasing, the Inflation Reduction Act (IRA) was signed into law in 2022. IRA helps seniors save money by capping out-of-pocket drug costs—starting at $2,000 in 2025 and adjusted to $2,100 for 2026—and allowing Medicare to negotiate prices on select high-cost medications. And while this benefits senior beneficiaries, it means Medicare Advantage plans now cover a larger share of high-cost drug expenses, which puts financial pressure on insurance carriers. As a result, some carriers have adjusted their plans by reducing extra benefits, tightening approval rules for medications or services, or leaving certain markets.

Tariffs and Supply Chain Costs

And most recently, tariffs were introduced in 2025. While tariffs are not directly impacting Medicare Advantage carriers immediately, they are causing rising costs for imported pharmaceuticals, medical devices, and supplies. These increases may lead to future changes in premiums and benefits as carriers respond to higher costs and economic uncertainties.

Positive Developments for Medicare Advantage

Still, despite these challenges, there is positive news. The current administration has increased Medicare Advantage funding by raising payment rates and supporting plan quality and enrollment growth. For 2026, CMS is increasing payments to Medicare Advantage plans by about 5%, reflecting rising medical costs and adjustments for medical education. Additionally, CMS will begin negotiating prices for selected high-cost Medicare Part D drugs in 2026, helping lower drug expenses over time.

Finding the Right Medicare Advantage Plan in New Hampshire with Woodpecker Insurance

We understand these changes can feel overwhelming. Medicare Advantage continues to evolve to offer comprehensive and affordable coverage. If you live in New Hampshire, plan availability varies by county. To find out which plans you can enroll in for 2026, please contact Woodpecker Insurance, or call us at 603-499-4399.

Let’s schedule a time to review your Medicare Advantage options and help you find the best plan for your needs.