AARP Hearing Center
Chris Gash
Key takeaways
- Prescription plans will have big changes.
- Your plan’s annual notice of change has all the details.
- Plan costs are laid out in the Medicare Plan Finder. Some plan rules will change.
- Medicare Advantage enrollees can compare with their own tool.
- Help is available to make these important decisions.
Be prepared for one of the biggest changes to the Medicare prescription drug program ever: In 2025, out-of-pocket costs for covered drugs will be limited to $2,000 annually.
The new cap applies to stand-alone Part D and Medicare Advantage (MA) plans with drug coverage. But the change is rippling down to other costs and coverage.
Your options for 2025 may look very different from before. Comparing available plans in your area during open enrollment Oct. 15 to Dec. 7 is essential.
The Centers for Medicare & Medicaid Services (CMS) announced that average monthly premiums in 2025 will be $40 for stand-alone Part D plans, a decrease of $1.63, and $17 for Medicare Advantage plans, down by $1.23. But that’s only part of the picture.
“Formularies, pharmacy networks and cost sharing for prescriptions may change even if the premiums do not,” says Gretchen Jacobson, vice president of the Medicare program at the Commonwealth Fund. The New York–based nonprofit finances health policy research. She stresses taking a close look to see if your present plan will still provide the best coverage for your prescriptions at your preferred pharmacy next year.
Some plans are raising premiums, adding prior authorization requirements for more medications, and increasing deductibles and copayments before you reach that $2,000 cap. The cap applies to out-of-pocket costs for covered prescription drugs, not premiums or costs for drugs not on the plan’s formulary.
Medicare Advantage plans may make other subtle changes:
- Increased copayments for specialist visits and hospital stays.
- Different providers participating in their networks.
- Less coverage for extras such as dental care.
- Higher out-of-pocket maximums for medical care.
You also could see new benefits like special coverage for chronic conditions, a move that should lower overall health care costs in the long run.
About 60 percent of Medicare Advantage enrollees who stay in their current plan will have no MA premium next year beyond the Part B, and perhaps Part A, monthly fees that apply to people in original Medicare as well as Medicare Advantage plans, CMS officials say.
But coverage details can vary a lot among plans. This is not the year to keep your present policy on autopilot.
Here are five steps to help you choose the best plan for your needs.
1. Review your plan’s annual notice of change
This mandatory document should have arrived from the insurer by the end of September. In it, you’ll find changes to your plan’s premium, deductibles, copayments, other out-of-pocket costs, provider network and preferred pharmacies.
It also will identify any new benefits. If your plan will be more expensive, you don’t have to stay.
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