2025 Medicare Update: What Changes Are Coming and How You Can Save

The 2025 annual Medicare enrollment period is just around the corner, running from October 15 to December 7.

Read: Now is the Time: Your Essential Checklist for the Annual Medicare Enrollment Period — October 15 to December 7

If you’re enrolled in Medicare, this is your chance to review and make changes to your coverage, which will go into effect on January 1, 2025.

But this year’s enrollment is especially important due to significant shifts in Medicare Part D and Medicare Advantage plans.

You likely received your Annual Notice of Change (ANOC) last month, detailing the upcoming changes to your Medicare plan.

If you’ve put it aside or misplaced it, now is the time to dig it out.

The changes coming in 2025 could affect your premiums, co-pays, and coverage options in big ways.
 

Why This Year’s Enrollment is Different

According to Juliette Cubanski, deputy director of the Medicare policy program at KFF, it’s crucial to review your plan this year due to changes in plan availability and premiums.

With so many plan options, it might seem overwhelming, but ignoring these changes could lead to higher costs or reduced coverage for essential medications. Learn more about Medicare policy changes from KFF.
 

What’s Changing in 2025?

1. New Cap on Prescription Drug Costs

Starting in 2025, there will be a $2,000 annual cap on out-of-pocket costs for those enrolled in Medicare Part D prescription drug plans, down from $3,500 this year.

This is a huge win for many seniors who struggle with high medication costs.

The cap, part of the Inflation Reduction Act, will benefit about 3.2 million Medicare enrollees in 2025.

By 2029, this number is expected to grow to 4.1 million. See how the Inflation Reduction Act impacts Medicare.

If you’re someone who spends a lot on prescription drugs, this change could save you an average of $1,500 in 2025.

But be on the lookout for possible increases in premiums and changes to drug formularies—the list of medications your plan covers. Compare Medicare Part D plans.
 

2. Potential Coverage for Weight-Loss Drugs

Currently, Medicare doesn’t cover weight-loss drugs. However, Part D plans can cover medications like Ozempic or Wegovy if they’re prescribed for other conditions, such as Type 2 diabetes.

With the FDA recently approving Wegovy for reducing heart attack risks in people with cardiovascular disease, we may see it added to more Medicare plans in 2025. Check for weight-loss drug coverage options.
 

3. A New Way to Pay for Prescriptions

In 2025, Medicare is introducing a Prescription Payment Plan that allows enrollees to spread out their out-of-pocket costs monthly, rather than paying in one lump sum.

This doesn’t reduce your total costs, but it can help with cash flow management. Explore payment options for Medicare Part D.

 

4. Changes in Medicare Advantage Plans

Medicare Advantage (MA) plans, which cover additional benefits like vision, dental, and fitness programs, will see some adjustments in 2025.

Deductibles are likely to increase, and some benefits may be reduced, including dental and vision coverage.

Additionally, some MA plans may drop gym memberships or raise co-pays for specialists. Learn more about Medicare Advantage.
 

5. Medigap Policies and Their Role

If you’re thinking of switching from a Medicare Advantage plan to traditional Medicare, consider looking into Medigap policies.

These plans cover gaps in Original Medicare, such as deductibles and co-pays, but they may have restrictions based on pre-existing conditions if you didn’t enroll when first eligible. Explore Medigap options.
 

Take Action: Review Your Plan

With so many changes on the horizon, it’s crucial to review your plan during the enrollment period.

Compare your drug costs, check if your current medications are still covered, and explore how your premiums and out-of-pocket expenses might change.

Medicare’s Plan Finder tool is an excellent resource to help you compare plans. Use the Plan Finder tool here.

For additional guidance, you can contact the State Health Insurance Assistance Program (SHIP) for free counseling or call the Medicare Rights Center helpline at 800-333-4114.

Lastly, consider the Star Ratings system to evaluate plan quality.

Medicare rates both Part C (Medicare Advantage) and Part D (prescription drug plans) on a 5-star scale based on customer satisfaction and quality of care. Check the Star Ratings for 2025.
 

Final Thoughts

Medicare plans change every year, and 2025 brings some of the most significant adjustments yet.

Don’t miss out on potential savings—give yourself the time to review your options, and you could save hundreds of dollars.

As Philip Moeller, a Medicare expert, advises: “Give yourself half an hour to save 500 bucks.”

Need help? Visit Medicare.gov or contact Medicare at 800-633-4227 for further assistance.

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