Medicare’s Annual Open Enrollment runs October 15 through December 7, but the decisions made during that 54-day window require preparation that begins well before it opens. For retirees and those approaching Medicare eligibility, July is a practical starting point: close enough to the enrollment period to be relevant, and far enough away to review options without the pressure of an imminent deadline.
The stakes are higher than many enrollees realize. Premiums, drug formularies, provider networks, and out-of-pocket costs all shift from year to year. According to KFF, roughly 70% of Medicare Advantage enrollees have access to a lower-premium plan offering similar benefits, but do not switch during Open Enrollment, often simply because they did not compare.¹ Auto-renewal is the default. It is also, for many people, the most expensive option.
What Open Enrollment Allows
During the October 15 through December 7 window, Medicare beneficiaries can make changes that take effect January 1, 2027. This includes switching between Original Medicare and Medicare Advantage, changing standalone Part D prescription drug plans, or moving from one Medicare Advantage plan to another. It is the primary opportunity of the year to make these changes outside of a Special Enrollment Period.²
One significant update worth knowing for 2026: the Inflation Reduction Act introduced a $2,000 annual cap on out-of-pocket prescription drug costs under Medicare Part D, replacing the previous coverage gap structure known as the “donut hole.” For enrollees with high drug costs, this change meaningfully alters the value calculation across Part D plans and warrants a fresh comparison even if coverage has felt adequate in prior years.³
Understanding IRMAA: The Income-Medicare Premium Connection
For higher-income retirees, Medicare planning intersects directly with income planning in a way that surprises many people. The Income-Related Monthly Adjustment Amount, known as IRMAA, is a surcharge added to Medicare Part B and Part D premiums for beneficiaries whose income exceeds certain thresholds. In 2026, the surcharge applies to individuals with Modified Adjusted Gross Income above $109,000 and married couples above $218,000.⁴
The critical detail is the two-year lookback. Your 2026 Medicare premiums are based on your 2024 tax return. Your 2027 premiums will be based on your 2025 return, meaning that income decisions made last year are already determining what you pay for Medicare today, and the income decisions you make this year will affect your 2028 premiums.⁵
IRMAA is also a cliff surcharge: crossing an income threshold by a single dollar triggers the full surcharge for the entire bracket, not just on the excess. For a married couple, the difference between staying below a threshold and crossing it can amount to thousands of dollars in additional annual premiums. Events that commonly trigger an unexpected IRMAA surcharge include Roth conversions, large IRA distributions, capital gains realizations, and the sale of a home or business.⁶
This is precisely why withdrawal sequencing strategy is so closely linked to Medicare cost planning. The income decisions made in any given year cast a long shadow.
Appealing an IRMAA Surcharge
If your income has declined since the tax year used to calculate your IRMAA, whether due to retirement, the death of a spouse, divorce, or a significant reduction in work, you have the right to appeal. The Social Security Administration allows beneficiaries to request a redetermination based on more recent income, and the appeal window is generally 60 days from receiving the IRMAA notice.⁷ If your circumstances have changed meaningfully, this is worth discussing with your advisor before the window closes.
What to Review Before October
A productive pre-enrollment review covers several questions: Has anything changed in your health or prescription needs since last year? Are your current providers still in-network under your plan? Has your plan’s formulary changed in ways that affect your medications? And, given IRMAA’s two-year lookback, are there income planning decisions this year that could affect your 2028 Medicare premiums?
The last question is the one most likely to require your financial advisor’s input. IRMAA management, withdrawal timing, and Roth conversion decisions are interconnected in ways that reward coordinated planning rather than decisions made in isolation.
Bottom Line: Open Enrollment is a few months away, but the preparation that makes it useful starts now. Reviewing your coverage needs, understanding how your income affects Medicare premiums, and coordinating with your advisor before the window opens can reduce costs and prevent surprises well into 2027 and beyond.
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