Medicare Advantage 2027 Out-of-Pocket Limit Is $9,850 In-Network, $14,800 With PPO Out-of-Network Care

Medicare Open Enrollment for 2027 coverage opened on October 15, 2026, and closes on December 7, 2026, the window the Centers for Medicare & Medicaid Services (CMS) announced on September 28, 2026, alongside a projection that the weighted average Medicare Advantage premium will fall from $14.37 a month in 2026 to $12.00 in 2027. The premium is the small number; the large one is the plan's maximum out-of-pocket amount, or MOOP, and CMS has capped it for 2027 at $9,850 for in-network care and $14,800 for in-network and out-of-network care combined. A plan with drug coverage adds a separate Part D limit of $2,400, so the $9,850 figure now circulating as the 2027 Medicare Advantage limit is one of three ceilings, and for a PPO member who sees out-of-network doctors it is not the one that ends the year's spending.

Both MOOP figures are maximums, not the amount on a given plan. Plans pick a number at or below them in one of three tiers, set by a CMS memo dated April 22, 2026, under rules in 42 CFR 422.100 and 42 CFR 422.101.

What CMS Announced, and Which Document Holds the Limits

The premium figures are in the CMS press release on 2027 Medicare Advantage and Part D premiums (September 28, 2026). The $12.00 average spans all Medicare Advantage plans, including plans with drug coverage and Special Needs Plans, and is down 16.5 percent from $14.37. For Medicare Advantage plans that include drug coverage, the drug part of the premium, after MA rebates, is projected to fall from $11.32 to $7, a drop of $4.32 or 38 percent. A stand-alone drug plan, the kind paired with Original Medicare, moves the other way, from $35.09 to $36 on average. CMS projects 34 million Medicare Advantage enrollees in 2027, about 47.4 percent of everyone in Medicare.

The release calls the average weighted without showing the weights. The sentence that speaks to a single household is a different one: “approximately eight in 10 MA beneficiaries will be able to remain in their current plan with the same or a lower premium in 2027.” Read from the other side, roughly two in 10 cannot stay put at the same or a lower premium. A falling average and a higher bill for a particular member can both be true.

The out-of-pocket ceilings were published months earlier, in Table 3 of the CMS memo Final Contract Year 2027 Standards for Part C Benefits, Bid Review and Evaluation (April 22, 2026), which tells plans to set an in-network amount and a combined amount for all Parts A and B services, each no greater than the CMS limits.

One PPO, Two Meters

The base rule is 42 CFR 422.100, the Medicare Advantage MOOP rules (eCFR). 42 CFR 422.100(f)(4) begins: “Except as provided in paragraph (f)(5) of this section, MA local plans (as defined in § 422.2) must have an enrollee in-network maximum out-of-pocket (MOOP) amount for basic benefits that is no greater than the annual limit calculated by CMS using Medicare Fee-for-Service (FFS) data projections.” Its exception is the PPO rule, and a second sentence extends the in-network limits to private fee-for-service (PFFS) plans. 42 CFR 422.100(f)(5) opens: “With respect to a local PPO plan, the MOOP limits specified under paragraph (f)(4) of this section apply only to use of in-network providers.”

Paragraph (f)(5) has three parts. Part (i) creates the second meter: “MA local PPO plans must establish a combined enrollee MOOP amount for basic benefits that are provided in-network and out-of-network that is no greater than the total catastrophic limit applicable to regional plans in § 422.101(d)(3).” Part (ii) ties both meters to the same tier. Part (iii) puts the counting on the plan: “MA organizations are responsible for tracking out-of-pocket spending accrued by the enrollee and must alert enrollees and contracted providers when the combined MOOP amount is reached.”

So in a PPO, in-network cost sharing runs on both meters, and out-of-network cost sharing runs only on the combined one. Take two members of a PPO that set both amounts at the 2027 mandatory ceilings.

Member A's in-network cost sharing for the year comes to $6,000, and then out-of-network care brings another $9,000 of cost sharing. The in-network meter reads $6,000, well under $9,850. The combined meter would read $15,000, so it stops at $14,800: Member A pays $8,800 of the $9,000 out-of-network share, and the last $200 is covered. Member B's in-network cost sharing would have come to $11,000, so it stops at $9,850; then $6,000 of out-of-network cost sharing arrives. The combined meter has $4,950 of room left, $14,800 minus $9,850, so that is what Member B pays. Both members finish at $14,800, and for neither of them did $9,850 end the year.

Three Tiers Under Each Ceiling

Table 3 of the 2027 memo lists plan types as rows under three columns headed Lower MOOP Limit, Intermediate MOOP Limit and Mandatory MOOP Limit. For HMO and HMO POS plans the cells give in-network ranges only: $0 to $4,450, $4,451 to $7,150, and $7,151 to $9,850. For PPOs, local and regional, each cell adds a combined range: $0 to $6,700 in the lower column, $4,451 to $10,750 in the intermediate column, and $7,151 to $14,800 in the mandatory column. Private fee-for-service (PFFS) plans get the same three dollar ranges as the in-network tiers, with no network label.

The memo puts the tiers plainly. “Mandatory: Highest in-network MOOP amount allowed by CMS.” The lower tier is a trade: “Plans may voluntarily adopt this lower in-network MOOP amount established by CMS in exchange for increased flexibility in cost-sharing requirements.” The intermediate tier is the midpoint option. A plan listing a $5,000 MOOP is intermediate; one at $9,850 sits at the very top of the mandatory tier.

The combined ranges overlap where the in-network ranges do not. A combined amount of $6,500 fits both the lower column ($0 to $6,700) and the intermediate column ($4,451 to $10,750). The in-network figure decides, under part (ii) of paragraph (f)(5): “The type of in-network MOOP limit dictates the type of combined MOOP limit the MA plan may use.”

Paragraph (f)(4) has six numbered parts. Part (i) has CMS calculate three limits a year from Medicare fee-for-service projections and sets the three dollar bands. Part (ii) assigns a plan the tier whose band its amount falls in. Part (iii) rounds: “Each MOOP limit CMS calculates is rounded to the nearest $50 increment and in cases where the MOOP limit is projected to be exactly in between two $50 increments, CMS rounds to the lower $50 increment.” Part (iv) fixed the 2023 starting points, $7,175 for the mandatory limit (the 95th percentile of projected spending for people without ESRD) and $3,360 for the lower limit (the 85th percentile), each plus 70 percent of an ESRD cost differential. Part (v) governs 2024 and later: the mandatory and lower limits move toward those percentiles, any rise above 10 percent over the prior year is capped at 10 percent, and the intermediate limit resets to the midpoint when either changes. Part (vi) defines the ESRD cost differential.

The 2027 moves sit well inside that cap. Table 3 of the CMS memo Final Contract Year (CY) 2026 Standards for Part C Benefits, Bid Review and Evaluation (April 16, 2025) shows $9,250 in-network and $13,900 combined at the mandatory top, $6,750 and $10,100 at the intermediate top, and $4,200 and $6,300 at the lower top. The 2027 mandatory ceilings rose $600 in-network and $900 combined, both 6.5 percent; the intermediate in-network ceiling rose $400, or 5.9 percent, and the lower one $250, or 6.0 percent.

Why 1.5 Times $9,850 Is Not $14,800

The combined ceiling is built from the in-network one, in 42 CFR 422.101, the special cost-sharing rules for MA regional plans (eCFR). 42 CFR 422.101(d)(3) carries the formula in part (ii): “CMS calculates the total catastrophic limits by multiplying the respective in-network MOOP limits (before the rounding rules in § 422.100(f)(4)(iii) are applied and after application of the 10 percent cap on increases to the mandatory and lower MOOP limits from the prior year in § 422.100(f)(4)(iv) and (v)) by 1.5 for the relevant year, then applying the rounding rules in § 422.100(f)(4)(iii).”

The multiplication runs on the unrounded figure, and Table 3 prints only rounded ones, so 1.5 times a published number misses. For 2027, 1.5 times $9,850 is $14,775 against a published $14,800; 1.5 times $7,150 is $10,725 against $10,750; 1.5 times $4,450 is $6,675 against $6,700. For 2026 the same steps give $13,875 against $13,900, $10,125 against $10,100, and $6,300 against $6,300: a $25 gap either way, or none. The tie rule in part (iii) would round $14,775, which sits exactly between $14,750 and $14,800, down to $14,750, so the published $14,800 implies an unrounded in-network figure slightly above $9,850.

Paragraph (d) of 42 CFR 422.101 has four numbered parts. Part (1) requires regional and local PPO plans that use a deductible to have a single one across in-network and out-of-network Part A and Part B services; separate in-network deductibles must count toward it, other plan-covered items may be waived from it, and Medicare-covered preventive services must be. Part (2) requires the in-network catastrophic limit, with the same tier for both limits. Part (3) sets the total catastrophic limit, with the 1.5 formula, bands that mirror Table 3, and a guard: “The total catastrophic limit may not be used to increase the catastrophic limit described in paragraph (d)(2) of this section.” Part (4) requires regional plans to track the deductible and both limits on costs for original Medicare covered services and to notify members and providers when one is reached.

The Drug Cap Runs on Its Own Meter

Table 3 limits cover Parts A and B services. Drugs are counted elsewhere. The Medicare.gov page How much does Medicare drug coverage cost? describes the payment stages that “Medicare drug plans and Medicare Advantage Plans with drug coverage” generally share, and gives the cap: “After you reach your full deductible (if your plan has a deductible), you'll pay 25% of the cost as coinsurance for your generic and brand-name drugs until your out-of-pocket spending on covered Part D drugs reaches $2,100 in 2026 ($2,400 in 2027) (including certain payments made on your behalf, like through the Extra Help program).” After that, catastrophic coverage applies, and in the page's words, “You won't have to pay out-of-pocket for covered Part D drugs for the rest of the calendar year.”

That $2,400 can be read two ways as well. It is not only the member's own money, because certain payments made on the member's behalf, such as Extra Help, count toward it. And it counts spending on covered Part D drugs, while the MOOP counts cost sharing for Parts A and B services, so a dollar on one meter does not move the other. The deductible ceiling moved with the cap: “No Medicare drug plan may have a deductible more than $700 in 2027 ($615 in 2026), and some plans have no deductible.” The drug cap rose $300, or 14.3 percent, and the deductible ceiling $85, or 13.8 percent, more than double the 6.5 percent rise in the mandatory MOOP.

Stacked at the mandatory ceilings, a Medicare Advantage HMO with drug coverage can leave a member with $9,850 of medical cost sharing plus $2,400 for drugs, $12,250 in all. A PPO member using out-of-network care faces $14,800 plus $2,400, or $17,200. An HMO at the top of the lower tier comes to $4,450 plus $2,400, or $6,850. None of these sums includes the plan premium or the Part B premium, which are separate monthly bills; the Part B side is worked through in Social Security Increase 2027: How Much Survives the Medicare Part B Premium.

One drug-side tool changes timing, not totals. Medicare.gov says of the Medicare Prescription Payment Plan, which spreads drug costs across the calendar year: “This payment option might help you manage your monthly expenses, but it doesn't save you money or lower your drug costs.” For anyone who went without drug coverage for a stretch, a separate penalty can ride on top of the premium, covered in TheWalletCompass on the Part D late enrollment penalty.

Numbers to Re-check

• $9,850 and $14,800 are the 2027 mandatory ceilings, not a plan's own figures. An in-network MOOP from $7,151 to $9,850 is mandatory tier, $4,451 to $7,150 intermediate, $4,450 or less lower.
• For a PPO, look for two MOOP numbers, in-network and combined. If only one appears, ask which meter it is.
• Do not derive a combined limit as 1.5 times the in-network one. For 2027 the shortcut is $25 low at every tier.
• Part D: a $2,400 out-of-pocket cap and a $700 maximum deductible for 2027, up from $2,100 and $615 in 2026.
• Worst-case covered cost sharing at the mandatory ceilings: $12,250 for an HMO with drug coverage and $17,200 for a PPO member using out-of-network care, with premiums on top.
• The $12.00 premium is an average that fell 16.5 percent from $14.37, and about eight in 10 members can keep their plan at the same or a lower premium. Compare the plan's own 2027 premium, not the average.
• The window to choose a 2027 plan runs from October 15 to December 7, 2026.

Where This Doesn't Apply

Original Medicare with a stand-alone drug plan. The MOOP tiers are Medicare Advantage rules in 42 CFR 422.100 and 42 CFR 422.101. Someone in Original Medicare with a stand-alone Part D plan falls under the $2,400 drug cap on Medicare.gov and the $36 average stand-alone premium in the CMS release, but not under Table 3.

HMO members going out of network. Table 3 gives HMO and HMO POS plans an in-network range only, so the $14,800 combined figure belongs to PPOs. What an HMO member owes for out-of-network care is a coverage question for the plan's own documents, not a MOOP question.

PFFS plans. Private fee-for-service plans have their own Table 3 row, with ranges that match the in-network tiers but no in-network or combined label. The two-meter reading here is a PPO reading.

Benefits beyond Parts A and B. Paragraph (f)(4) sets the limit for basic benefits, and the memo describes it as covering all Parts A and B services. Extras such as routine dental or vision fall outside that description, so check the plan's Evidence of Coverage before counting their cost sharing toward the limit.

Special Needs Plans. CMS issues separate cost-sharing standards for certain dual eligible special needs plans, which were not reviewed for this post.

What could change these numbers. The Part D parameter attachment of the 2027 Rate Announcement could not be read in this check, so the $2,400 cap and $700 deductible rest on the Medicare.gov page. The $25 explanation is arithmetic on the published Table 3 numbers, not a CMS statement.