In 2025, Medicare will undergo some of the most significant changes in a generation. Changes to Medicare will include a $2,000 limit on out-of-pocket Part D drug costs, an opt-in payment plan, and some potential broad changes in Medicare Advantage plans.

In response to these changes, insurance companies are restructuring formularies and if your drugs are not on the formularies they do not count towards your max out of pocket. Therefore, it is so important to sit down with a Medicare specialist to determine if you’re on the right plan.

Please schedule an appointment with James or another trusted Medicare specialist during the Annual Enrollment Period (AEP) to pick a new plan for next January. The AEP runs from October 15 through December 7.

To schedule an appointment with James, please click here.

Key Takeaways

1. Medicare changes include the elimination of the Medicare “donut hole” and a limit on how much you’ll have to pay out of pocket for covered prescription drugs.
2. There will be a new payment plan you can opt into to spread out your medication costs.
3. In response to these changes, insurers will likely change pricing and coverage for Medicare Advantage and Part D plans.
4. Medicare Advantage beneficiaries should receive a letter in the middle of 2025 about unused benefits.
5. Other changes impact the availability of mental health care, prior authorization use, and unpaid caregiver support for Medicare recipients with dementia.

Just some of the details:

1. Drug deductible: Most Prescription Drug plans (and Medicare Advantage plans that include Part D) will have a deductible increase. Deductibles for plan year 2025 cannot surpass $590.
2. Elimination of the Coverage Gap: The coverage gap (or Donut Hole) will no longer exist as of 2025. After meeting their deductible, enrollees will pay a portion of covered drug costs until the out-of-pocket threshold of $2,000 is met. Afterwards, enrollees pay nothing for covered drugs for the rest of the plan year.
3. Redefinition of TrOOP: TrOOP (True Out-of-Pocket Costs) is the amount spent on covered drugs that counts towards a beneficiary’s out-of-pocket threshold. The redefinition of TrOOP will now include enhanced alternative supplemental benefits offered by Part D sponsors (which are benefits that exceed the standard Part D model) and exclude payments using the new Discount Program.
4. New Drug Payment Plans: Beneficiaries can now choose to spread their drug costs out with manageable installations rather than paying a large sum at the pharmacy for their prescriptions. Payment plans must be set up with your insurance provider.
5. Medicare Advantage Plan Benefits Reduction: It is possible that many Advantage plans will begin cutting back on additional benefits like over-the-counter allowances and Part B givebacks. This is due to cuts in federal funding and increased plan spending.
6. Benefit Usage Notice: Those who have Medicare Advantage plans will now receive a notice mid-year, advising them if they have unused benefits. Since Advantage plans usually carry additional benefits such as dental and vision care, enrollees will be notified about any benefits they are entitled to under their plan that they haven’t yet used.
7. Dementia Care Expansion: The GUIDE program (Guiding an Improved Dementia Experience) will partner with more organizations to offer enhanced services to caregivers and people living with dementia. Some of the benefits include respite care, 24/7 access to care navigators, and caregiver training.
8. Mental Health Prioritized: Medicare Advantage plans are now required to provide sufficient access to behavioral health practitioners like therapists, mental health counselors, opioid treatment providers, and drug counselors.

As you can see, there are many changes this year. Medicare has always been confusing and the coming year it will be more so.

Fortunately, there are Medicare agents, like myself, who have been trained in these changes and stand ready to help you understand the program better and choose the right options for your specific needs.

Using a Medicare agent does not cost you anything. We are paid by the program. It is our job to assess your needs and help you make the right choices.

Please schedule an appointment with James or another trusted Medicare specialist during the Annual Enrollment Period (AEP) to pick a new plan for next January. The AEP runs from October 15 through December 7.

To schedule an appointment with James, please click here. or reach out to James at here or 631-608-1137.