Medicare open enrollment is in full swing and runs until December 7. We encourage clients to understand the changes that will go into effect on January 1. Every year, we see tweaks, but this time around, some changes could really impact coverage choices and costs. Whether you're already on Medicare or planning to enroll soon, it's crucial to stay informed and ensure your plan fits your needs.
Here are the changes you should plan for:
1. Expanded Coverage for Preventive Care
First, some good news. Beginning in 2025, Medicare is expanding its coverage for preventive services. This means that you’ll have more access to screenings, wellness visits, and vaccinations—without worrying about out-of-pocket costs. These preventive measures can help catch potential health issues early, which we all know is key to staying healthy. The list of covered services now includes more comprehensive screenings for heart disease and diabetes, plus additional support for mental health. If staying proactive with your health is important to you, this is a change worth celebrating. Check out Medicare preventive services here https://www.cms.gov/medicare/coverage/preventive-services-coverage.
2. Changes to Prescription Drug Costs
One of the biggest changes coming to Medicare in 2025 is the new pricing structure for prescription drugs. The Inflation Reduction Act, which was signed into law in 2022, is set to fully take effect in 2025. For the first time, Medicare will have the power to negotiate drug prices directly with pharmaceutical companies, which could lead to lower costs for some of the most expensive medications.
In addition, the catastrophic coverage threshold is also changing. Once your out-of-pocket spending on prescription drugs reaches $2,000, you will no longer pay anything for prescription drugs the rest of the calendar year. This threshold is down dramatically from $8,000 in 2024.
3. New Medicare Advantage Benefits
If you’re enrolled in Medicare Advantage, or considering making the switch, you’ll want to know about the changes coming to these plans. In 2025, Medicare Advantage plans will have more flexibility to offer additional benefits. This includes services like transportation to medical appointments, home-delivered meals, and fitness programs. But that doesn’t mean that all Medicare Advantage plans will have the same benefits, and some may even reduce their benefits or add limitations for when the benefits can be accessed.
These extra perks have made Medicare Advantage plans increasingly popular, but it’s important to remember that those with more benefits may be increasing their premiums to cover the additional cost. Also not all plans will include your preferred physicians in their network. Make sure to carefully review your options during open enrollment to find a plan that matches your lifestyle and healthcare needs.
If unrestricted access to physicians and other healthcare providers is important to you, you should consider choosing traditional Medicare plus a Medigap—or Medicare supplement insurance—plan. They can be expensive but will cover most out-of-pocket expenses that Medicare alone doesn’t cover. There are 12 standard plans making it a little easier to compare on price. Learn more here.
An important note: If you first choose Medicare Advantage, in subsequent years you do have the option to disenroll from Medicare Advantage, enroll in original Medicare, and apply for a Medigap policy. However, once the Medigap open enrollment period (six months after initially enrolling in Medicare Part B) has passed, insurers can deny coverage or charge more. During the Medigap open enrollment period, they cannot deny you coverage based on age or pre-existing conditions.
4. Adjustments to Premiums and Deductibles
In 2025, we’re expecting slight increases in premiums for both Medicare Part B (which covers doctor visits and outpatient care) and Part D (prescription drug coverage). While these increases are relatively modest, they can still impact your budget.
To help with these rising costs, the income-related monthly adjustment amounts (IRMAA) for higher earners will also be adjusted. For individuals and married filing separately, the income limit will be $103,000 and for married filing jointly the limit will be $206,000.
What Can You Do?
With these changes on the horizon, it’s more important than ever to review your Medicare options. Open enrollment is your chance to reassess your needs, compare plans, and make sure you’re getting the best coverage at the best price. Don’t wait until the last minute—take the time to explore your options now and make sure you’re ready for the new year. The publication Medicare & You 2025 is a good resource for understanding the Medicare landscape.
Seek unbiased advice from organizations that do not have skin in the game. They include:
Medicare’s own website - https://www.medicare.gov/
The State Health Insurance Assistance Program in your state – Florida’s is https://www.shiphelp.org/about-medicare/regional-ship-location/florida
Medicare Rights Center - https://www.medicarerights.org/
Center for Medicare Advocacy - https://medicareadvocacy.org/
KFF (independent health policy research) - https://www.kff.org/medicare/
