Medicare Open Enrollment and Social Security: Points to Consider This Fall as Retirement Approaches

By Mona Fahmy Kuhlman MBA, CFS, AIF® | October 2026

Each October, two things tend to arrive at about the same time: Medicare’s Annual Enrollment Period and the Social Security Administration’s announcement of next year’s cost-of-living adjustment, which arrived this morning. For professionals within a few years of 65, or already enrolled, this season can be a practical moment to step back and look at how health care coverage, retirement income, and taxes fit together.

Medicare and Social Security are often treated as paperwork to complete. For families with significant assets, they can also be planning decisions with long-term consequences. Below are several areas that may be worth reviewing this fall.

A note on scope before we begin. This article is a general overview and is not a complete list of the rules, exceptions, or deadlines that may apply to you. TandemGrowth is a financial planning firm; we are not Medicare or Social Security specialists, and we do not sell or recommend insurance plans. For questions about your specific coverage or benefits, the official resources are Medicare.gov and 1-800-MEDICARE, your State Health Insurance Assistance Program (SHIP), and the Social Security Administration at ssa.gov or 1-800-772-1213.

Medicare Open Enrollment runs October 15 to December 7

During Medicare Open Enrollment, often called the Annual Enrollment Period, people with Medicare can change their health plans and prescription drug coverage for the following year.¹ For 2027 coverage, Open Enrollment runs from October 15 through December 7, 2026. Those who want to keep their current coverage generally do not need to re-enroll.²

Plans may change their costs, coverage, and provider and pharmacy networks from year to year. The Centers for Medicare & Medicaid Services (CMS) encourages beneficiaries to review their plan’s Evidence of Coverage and Annual Notice of Change before deciding whether to stay or switch.¹ Among the items that may be worth checking:

• Whether each of your prescriptions remains on the plan’s formulary, and at what cost tier
• Whether your doctors, specialists, and preferred hospitals remain in network
• Changes to premiums, deductibles, and the plan’s out-of-pocket maximum
• Your estimated total annual cost, which can be compared using the Medicare Plan Finder at Medicare.gov or by calling 1-800-MEDICARE2

This list is not exhaustive. Your plan documents, Medicare.gov, and a SHIP (State Health Insurance Assistance Program) counselor can help identify other factors that apply to your situation.

For context, CMS projects the average monthly premium for Medicare Advantage plans, including those with prescription drug coverage, to decline to $12.00 in 2027, from $14.37 in 2026, while the average stand-alone Part D premium is projected at $36, from $35.09.² Averages can differ meaningfully from what any one plan charges, which is one reason a side-by-side comparison may be helpful.

Part D is also changing. The annual cap on out-of-pocket costs for covered prescription drugs is $2,100 in 2026 and is scheduled to rise to $2,400 in 2027.^{3 21} Once out-of-pocket spending on covered drugs reaches the cap, you generally pay nothing more for covered Part D drugs for the rest of the year.²¹

A one-time Part B premium rebate in October 2026

CMS announced a one-time $90 rebate toward Part B premiums, paid in October 2026 through the Medicare Improvement Fund. It is available to people enrolled in Original Medicare Part B who live in the United States, do not receive Medicaid premium assistance, and do not pay an Income-Related Monthly Adjustment Amount (IRMAA). Medicare Advantage enrollees are not eligible.⁴ According to CMS, most recipients were scheduled to receive a direct deposit from Social Security on or around October 8, with paper checks from the U.S. Treasury following later in October.⁴

Because households paying IRMAA do not qualify, many higher-income beneficiaries may not see this payment.

If you are approaching 65, timing matters

Your Initial Enrollment Period is a seven-month window that begins three months before the month you turn 65 and ends three months after.⁵ If you started Social Security benefits at least four months before turning 65, you are generally enrolled in Parts A and B automatically. Otherwise, you typically sign up through the Social Security Administration, online at ssa.gov, by phone, or at a local office.¹⁷

Many professionals continue working past 65. In that case, some of the questions that can shape the decision include:

• How large is your employer? If your employer has fewer than 20 employees, Medicare generally pays first at 65, which may make enrolling in Part B important.⁶

• Do you contribute to a Health Savings Account? Medicare.gov suggests that you and your employer stop HSA contributions six months before you retire or apply for Social Security, to help avoid a tax penalty.⁷

• Will you rely on COBRA after leaving? If you delayed Part B while covered by a current employer, you generally have an eight-month window that begins when you stop working or lose that coverage, whichever comes first, and COBRA does not extend it.7 ⁸

The Part B late enrollment penalty is generally 10% for each full 12-month period you could have had Part B but did not enroll, and it typically lasts for as long as you have Part B.⁹ A separate Part D penalty may apply if you go 63 days or more without creditable drug coverage; it is calculated as 1% of the national base premium for each month without coverage and generally lasts as long as you have Medicare drug coverage.⁹ These rules have exceptions and details beyond what is covered here, so confirming your own situation with Social Security or Medicare before your enrollment window closes may help you avoid an outcome that is difficult to reverse.

Original Medicare with Medigap or Medicare Advantage

For many people, one of the larger decisions at enrollment is choosing between two broad paths. Original Medicare paired with a Medicare Supplement (Medigap) policy and a Part D plan generally offers broad provider access and more predictable out-of-pocket costs, with higher monthly premiums. Medicare Advantage plans often carry lower premiums and may include extra benefits, but typically use provider networks and include copays up to an annual maximum. This is a simplified comparison. Which path fits depends on individual circumstances, and a licensed insurance professional or SHIP counselor can walk through the differences in detail.

Timing can be especially important here. Your Medigap Open Enrollment Period lasts six months and begins the first day of the month you are 65 or older and enrolled in Part B. Outside that window, there is no federal guarantee that an insurer will sell you a Medigap policy, and pricing may reflect your health history.¹⁰ As a result, switching from Medicare Advantage to Medigap later may not always be possible on the same terms.

For families who travel frequently, split time between states, or value access to specific specialists, these tradeoffs may deserve careful thought.

Higher income can mean higher Medicare premiums

The standard Part B premium is $202.90 per month in 2026, with a $283 annual deductible.¹¹ Higher-income households may pay more through IRMAA. For 2026, IRMAA begins at modified adjusted gross income above $109,000 for single filers and $218,000 for married couples filing jointly, based on the tax return filed two years earlier, so 2026 premiums generally reflect 2024 income.¹⁴ Total Part B premiums for those affected range from $284.10 to $689.90 per person per month, with a separate surcharge of $14.50 to $91.00 added to Part D premiums.¹¹

Because of the two-year lookback, income decisions made today can affect premiums later. Events that may raise income in a single year include Roth conversions, large capital gains, the sale of a business or property, and deferred compensation or equity payouts. Coordinating the timing of these events with your CPA may help manage how IRMAA affects your budget.

If your income has dropped because of a qualifying life-changing event, such as retirement or a reduction in work, you can ask Social Security to reconsider your IRMAA determination using Form SSA-44.¹²

Social Security: the COLA and your claiming decision

On October 14, the Social Security Administration announced a 3.6% cost-of-living adjustment for 2027, up from 2.8% for 2026.13 19 The increase applies to benefits beginning in January 2027. SSA also noted that the maximum earnings subject to Social Security tax is slated to rise to $192,300 in 2027, from $184,500.19 Because most people have their Part B premium deducted automatically from their Social Security payment,¹⁸ the COLA and any premium change together shape the net amount you receive.

The 2027 Medicare Part B premium and IRMAA thresholds have not yet been released; CMS typically publishes them in the fall, and the net change in your monthly benefit depends on both.¹¹

Viewing your 2027 benefit amount

SSA will post COLA notices showing updated benefit amounts in late November to personal my Social Security accounts at ssa.gov/myaccount. If you do not already have an account, SSA says you will need to create one by November 18 to view your notice online. Account holders can also opt in to text or email alerts when the notice arrives. Those not enrolled in paperless notices will receive a mailed notice in December.19

For those who have not yet claimed, timing remains one of the more meaningful retirement income decisions. You can generally claim between ages 62 and 70. Full retirement age is 67 for anyone born in 1960 or later, and claiming earlier reduces your monthly benefit, a reduction that is usually permanent.^{15 20} Delaying past full retirement age increases your benefit by 8% per year until 70 for those born in 1943 or later.¹⁶ For married couples, the higher earner’s timing can also affect survivor benefits.

Claiming is rarely a standalone decision. The years between retirement and claiming may present an opportunity for tax planning, such as Roth conversions. Those same conversions may affect IRMAA two years later, which is one example of how these decisions connect.

Bringing it together

Medicare and Social Security choices often intersect with tax strategy, retirement income timing, and portfolio structure. Viewing them together, rather than one at a time, may provide a clearer picture of what retirement cash flow could look like.

If you are approaching 65, preparing to leave employer coverage, or simply want a second look at how these pieces fit within your broader plan, we welcome the conversation. TandemGrowth works with families who have $1,000,000 or more in investable assets to coordinate retirement income planning, tax-aware strategies, and portfolio structure. We do not advise on or sell Medicare plans. Our role is to help place these decisions within your overall financial plan, working alongside your tax professional and, where appropriate, a licensed insurance professional or Medicare counselor. Schedule a complimentary, no obligation call with a TandemGrowth advisor today.

Sources

1. CMS, “Medicare Open Enrollment Partner Resources.” https://www.cms.gov/priorities/key-initiatives/medicare-open-enrollment-partner-resources

2. CMS, “Medicare Advantage, Medicare Prescription Drug Programs Expected to Remain Stable in 2027,” press release, September 28, 2026. https://www.cms.gov/newsroom/press-releases/medicare-advantage-medicare-prescription-drug-programs-expected-remain-stable-2027

3. CMS, “Announcement of Calendar Year (CY) 2027 Medicare Advantage Capitation Rates and Part C and Part D Payment Policies,” April 2026. https://www.cms.gov/files/document/2027-announcement.pdf

4. CMS, “Medicare Improvement Fund Premium Rebate: Frequently Asked Questions,” fact sheet, October 3, 2026. https://www.cms.gov/newsroom/fact-sheets/medicare-improvement-fund-premium-rebate-frequently-asked-questions

5. Medicare.gov, “When can I sign up for Medicare?” https://www.medicare.gov/basics/get-started-with-medicare/sign-up/when-can-i-sign-up-for-medicare

6. Medicare.gov, “Who pays first?” https://www.medicare.gov/health-drug-plans/coordination/who-pays-first

7. Medicare.gov, “Working past 65.” https://www.medicare.gov/basics/get-started-with-medicare/medicare-basics/working-past-65

8. Medicare.gov, “COBRA coverage.” https://www.medicare.gov/basics/get-started-with-medicare/medicare-basics/working-past-65/cobra-coverage

9. Medicare.gov, “Avoid late enrollment penalties.” https://www.medicare.gov/basics/costs/medicare-costs/avoid-penalties

10. Medicare.gov, “When can I buy a Medigap policy?” https://www.medicare.gov/health-drug-plans/medigap/ready-to-buy/when

11. CMS, “2026 Medicare Parts A & B Premiums and Deductibles,” fact sheet, November 2025. https://www.cms.gov/newsroom/fact-sheets/2026-medicare-parts-b-premiums-deductibles

12. Social Security Administration (SSA), “Request to lower an Income-Related Monthly Adjustment Amount (IRMAA).” https://www.ssa.gov/medicare/lower-irmaa

13. SSA, “Social Security Announces 2.8 Percent Benefit Increase for 2026,” press release, October 24, 2025. https://www.ssa.gov/news/en/press/releases/2025-10-24.html

14. SSA, “Medicare Premiums: Rules for Higher-Income Beneficiaries.” https://www.ssa.gov/benefits/medicare/medicare-premiums.html

15. SSA, “Benefits Planner: Retirement Age and Benefit Reduction.” https://www.ssa.gov/benefits/retirement/planner/agereduction.html

16. SSA, “Benefits Planner: Delayed Retirement Credits.” https://www.ssa.gov/benefits/retirement/planner/delayret.html

17. Medicare.gov, “How do I sign up for Medicare?” https://www.medicare.gov/basics/get-started-with-medicare/sign-up/how-do-i-sign-up-for-medicare

18. Medicare.gov, “How to Pay Part A & Part B premiums.” https://www.medicare.gov/basics/costs/pay-premiums

19. SSA, “Social Security Announces 3.6 Percent Benefit Increase for 2027,” October 14, 2026. https://www.ssa.gov/blog/en/posts/2026-10-14.html

20. SSA, “When to Start Receiving Retirement Benefits,” Publication No. 05-10147. https://www.ssa.gov/pubs/EN-05-10147.pdf

21. Medicare.gov, “Costs for Medicare drug coverage.” https://www.medicare.gov/health-drug-plans/part-d/basics/costs

Important information about this article

This article is provided for informational and educational purposes only. It is a general overview and does not address every rule, exception, or deadline that may apply to an individual. TandemGrowth and its advisors are not Medicare or Social Security specialists, are not licensed to sell insurance, and do not represent any government agency. The figures, dates, and program rules it contains were obtained from the government sources listed above, and we believe them to be accurate as of the date of publication. However, TandemGrowth does not guarantee their accuracy or completeness. Medicare and Social Security rules, premiums, income thresholds, and enrollment periods are updated regularly, often annually. Before making any enrollment, coverage, or claiming decision, please confirm current information directly with official sources, including Medicare.gov (1-800-MEDICARE), CMS.gov, and SSA.gov (1-800-772-1213), and consult the appropriate tax, legal, and insurance professionals regarding your situation.

For educational purposes only, not personalized investment advice. TandemGrowth Financial Advisors, LLC is an SEC-registered investment adviser. Registration does not imply a certain level of skill or training. This content is general in nature and does not constitute investment, tax, legal, or insurance advice. TandemGrowth is not affiliated with Medicare, the Centers for Medicare & Medicaid Services, the Social Security Administration, or any government agency, and does not sell or recommend specific insurance plans. For more information, please review our Form ADV Part 2A, available upon request or at https://adviserinfo.sec.gov/firm/summary/125490.