What Happened?

If you are a noncitizen enrolled in Medicare since July 4, 2025 or earlier, your premium-free hospital coverage ends at the end of January 2027 unless you meet the new criteria. ​

The new Medicare payment rules 2027 take effect Jan. 1, 2027, according to a Legis1 review of the 2027 physician fee schedule rule, issued Nov. 9.

The Centers for Medicare & Medicaid Services (CMS), part of the U.S. Department of Health and Human Services, wrote the rule. It changes who qualifies for free hospital coverage and how much Medicare pays doctors:

  • Doctor pay: The rate for clinicians in qualifying alternative payment models falls $0.62 (1.83 percent) from $33.5675, and the rate for everyone else falls $0.77 (2.31 percent) from $33.4009.
  • Hospital coverage: Premium-free coverage now also requires being a U.S. citizen, a national or an "eligible noncitizen," effective July 4, 2025, on top of age, disability benefits or end-stage renal disease.
  • Pending applications: CMS says a pending application for immigration status is not enough to qualify.
  • Drug rebates: CMS sets steps for the Medicare Part B (doctor and outpatient coverage) and Part D (prescription drug coverage) rebate programs when the consumer price index data it needs are unavailable.
  • Hospital drug reporting: New claims reporting starts for 340B covered entities, the hospitals and clinics that buy discounted drugs under a federal program.

Why Does it Matter to Me?

The doctor pay cuts start with the new year, so the rate Medicare uses to pay your doctor's office drops on Jan. 1, 2027.

If you were enrolled as of July 4, 2025 and do not meet the new criteria, CMS says it lacks authority to let people already enrolled keep coverage. Individuals who no longer qualify "will lose entitlement to hospital insurance benefits without premiums," the rule says.

CMS also added a way for accountable care organizations, networks of providers, to let participants reduce or eliminate deductibles and coinsurance for eligible patients.

Both Sides, Now

CMS says its revised method for indirect practice costs corrects an "unintended advantage" for services with separate professional and technical components. It says eligibility categories are set by statute, and it plans an outreach effort "accessible, multimodal, and broad in reach," coordinated with the Social Security Administration (SSA).

Critics point to patient access. A commenter on Regulations.gov said lower payments could force independent and small-practice physicians to limit Medicare patients, delay new technologies or close practices, with disproportionate effects in rural and underserved communities.

On coverage, a Center for Medicare Advocacy report dated Oct. 1, 2026 says the Congressional Budget Office estimated that about 100,000 lawfully present immigrants would lose Medicare access. That is a projection, not a count of completed terminations.

CMS received about 43,100 timely pieces of correspondence on the proposal.

What Happens Next?

CMS says its outreach to affected noncitizens will be coordinated with SSA, which has one year from July 4, 2025, to finish reviewing people enrolled as of that date. CMS says SSA will send termination notices toward the end of December 2026.

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