The Annual Enrollment Period (AEP) for Medicare, which runs from Oct. 15 to Dec. 7, is the designated time for individuals already enrolled in Medicare to review their coverage.
During this window, beneficiaries can make changes to their existing plan or switch to a different one.
Dave Ramsey has a warning for Americans: This is not the time to sign up for Medicare for the first time. Instead, he explains that people should use the AEP to evaluate whether their current plan still meets their health and financial needs, especially since coverage details and costs can change from year to year.
Related: Medicare open enrollment 2026: what you can do now
Medicare first-time enrollment should occur when people turn 65 during their initial Enrollment Period or any year after that during a General Enrollment Period that runs from Jan. 1 to March 31.
Ramsey points out an important way Medicare is different from regular health insurance.
“Unlike regular health insurance, Medicare doesn’t have plans for couples or families — it only covers individuals,” he wrote. “Medicare comes in what are called ‘parts’ … and then a Medicare supplement. Each part is like a little mini plan that helps cover a different aspect of health care.”
What each Medicare ‘part’ covers
- Medicare Part A provides coverage for inpatient hospital care, including overnight stays, as well as services received in a skilled nursing facility, hospice care, and certain types of home health care. It’s designed to help with the costs associated with more intensive medical situations that require admission or specialized support.
- Medicare Part B focuses on outpatient medical services. This includes visits to doctors and other health care providers, outpatient procedures, home health care, and durable medical equipment such as wheelchairs, oxygen tanks, and hospital beds. It also covers a wide range of preventive services, including screenings, immunizations, and annual wellness exams.
- Medicare Advantage, or Part C, combines hospital, medical, and often drug coverage into one plan offered by private insurers. Many plans include extras such as dental and vision. Separate premiums are paid for Part B and an Advantage plan, and out-of-pocket costs vary. Coverage is limited to in-network providers, and referrals may be required for specialists. Plans may not auto-renew. Though it seems simpler, one has less control than with Original Medicare.
- Medicare Part D is the prescription drug component of Medicare. It helps pay for medications prescribed by a doctor and also covers many recommended vaccines and immunizations. People enrolled in Original Medicare need to add Part D separately. However, most Medicare Advantage plans include drug coverage as part of their benefits.
- Medical Supplemental Insurance, also known as Medigap, is offered by private insurers. It helps pay expenses not covered by Original Medicare. It’s especially useful for those facing frequent medical bills. If one enrolls in a Medigap plan, they will pay a separate premium for it, along with their regular Medicare Part B premium. Most Original Medicare users benefit from having it.
AARP highlights 7 changes to Medicare in 2026
Several changes are coming to Medicare in 2026, the AARP explains.
Some Medicare drug prices drop
Starting Jan. 1, Medicare will offer reduced prices on ten high-cost prescription drugs, including treatments for arthritis, cancer, and diabetes. These negotiated rates apply to all Medicare Advantage and Part D plans, potentially saving beneficiaries $1.5 billion in 2026 alone.
Plan switching made easier
Medicare’s Plan Finder now includes provider network details for many Advantage plans, helping users confirm if their doctors are covered. If enrollees discover inaccurate information within three months of joining a plan, they’ll have a one-time opportunity in 2026 to switch plans or return to Original Medicare.
Part D costs increase
In 2026, the annual out-of-pocket cap for Part D drug plans rises from $2,000 to $2,100. The maximum deductible also increases to $615. These adjustments reflect higher drug spending trends, though some plans may offer lower deductibles or none at all.
Drug payment plan auto-renews
Beneficiaries who joined the Medicare Prescription Payment Plan in 2025 will be automatically reenrolled in 2026 unless they opt out or switch plans. This program allows monthly payments for drug costs, easing financial strain. Opt-out requests must be processed within three days.
Prior authorization pilot begins
Original Medicare will test prior authorization in six states starting Jan. 1. Beneficiaries may need approval before receiving certain services or devices. The pilot aims to reduce waste and fraud but has raised concerns about delays and denials in care.
Supplemental benefits pilot ends
A pilot offering extra benefits to low-income Medicare Advantage enrollees — such as transportation and food support — will end due to high costs. More than 7 million people may lose access to these services, which were designed to improve care for vulnerable populations.
Limits on Nonmedical Benefits
The Centers for Medicare and Medicaid Services (CMS) will restrict certain nonmedical supplemental benefits in Medicare Advantage plans for chronically ill enrollees. Items such as alcohol, tobacco, cosmetic procedures, and funeral services will no longer qualify. The goal is to ensure benefits directly support health or functional improvement.
Related: Dave Ramsey warns Americans on critical Medicare mistake to avoid
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