WHEN IS OPEN ENROLLMENT FOR 2025?
WHAT DOES MEDICARE (PARTS A & B) COVER?
WHY SHOULD I CONSIDER ADVANTAGE PLANS (PART C) and PART D
2025, A SIGNIFICANT OVERHAUL; HOW WILL CHANGES TO MEDICARE AFFECT ME?
WHO CAN I TURN TO?
Medicare enrollment 2024
For US residents already enrolled on Medicare plans, enrollment is from October 15th until December 7th for the plan year beginning January 1st, 2025. If you turn sixty-five outside open enrollment, you can enroll at any time three months before and after the month of your 65th birthday.
What does Medicare (PARTS A&B) cover?
Medicare is a complicated combination of subsidies and insurance coordinated and subsidized by state and federal agencies to provide essential healthcare for senior US citizens and those under sixty-five with severe terminal conditions.
Medicare Part A (Hospital Insurance program) covers the cost of hospital inpatient care and (short-term) stays in skilled nursing facilities.
Medicare Part B covers outpatient (ambulatory) services, such as outpatient hospital and physician visits, and preventive/screening services, such as cardiovascular screening/behavioral therapy, bone mass measurements, alcohol screening/counseling, and a yearly wellness visit.
If you are sixty-five or over and you or your spouse (or former spouse) has a record of having paid Medicare taxes for ten years (forty quarters), you are eligible for Medicare Part A premium-free.
Signing up for Medicare Part A and receiving your Medicare Card automatically gives you the option to join Medicare Part B. The Medicare Part B premium is expected to be $185 per month (premiums are tax deductible if your total allowable medical expense exceeds 7.5% of your adjusted gross income, AGI).
Part C (Advantage) and Part D (Prescription drug) plans
Part C, often called the Medical Advantage program, allows anyone entitled to Medicare parts A and B to enroll in a private plan (e.g., health maintenance organization, HMO, or preferred provider organization, PPO). Advantage plans (part C) cover all the benefits of parts A & B with the added benefit of greater service delivery flexibility (e.g., a more comprehensive choice of provider), cost-sharing, and out-of-pocket limit options.
Advantage plans typically include the outpatient drug benefit (part D) and can include vision, dental, and hearing benefits not covered by traditional Medicare.
Suppose you are already enrolled in an Advantage plan and want to switch to an alternative Advantage plan or a Medicare original plan. You can do so during the Medicare Advantage enrollment window from January 1st to March 31st.
Medicare Part D plans (prescription drugs) are federally regulated and subsidized programs open to everyone eligible for Parts A and B. These optional plans are provided through approved private companies and cover ‘outpatient’ branded and generic prescription drugs. NOTE: Not all pharmacies participate in the program. As with most other plans, the cost structure includes a monthly premium, a deductible, and cost-sharing terms.
Significant changes for Medicare in 2025
The rules and regulations governing the administration of the Medicare program change every year. Over sixty-seven million Americans (approximately 1 in 4 adults) are enrolled, and almost every family in the land is affected in one way or another (the federal government spent nearly $850 billion in 2023). The Centers for Medicare and Medicaid Services (CMS) ensures that the program is delivered effectively, efficiently, and equitably for the benefit of all stakeholders.
The headline changes for the plan year 2025.
- A cap on out-of-pocket costs
This applies to drugs and medications that Medicare Part D would cover. For the plan year 2024, the limit was $8000 and is now reduced to $2000. This benefits enrollees with chronic conditions or dependency on high-cost covered medications, but it may influence insurers to raise monthly premiums.
- Elimination of the ‘donut hole’ (coverage gap)
In addition to the reduced cap on spending, the ‘catastrophic’ stage is when the insurer pays 100% of the cost of Medicare-covered drugs and will begin immediately after the new cap ($2000) has been reached.
- Prescription payment plan
The Medicare Prescription Plan is an optional program that allows you to spread the cost of your prescriptions over the plan year with monthly bills until you reach the out-of-pocket maximum
- Medicare Advantage plans
A significant feature of ‘advantage’ plans has been the enrollee’s option to include supplementary cover; hearing, vision, and dental are the frequently included supplements. A Commonwealth Fund survey (2024) found that three out of ten Medicare Advantage plan members did not utilize any available benefits. Suppose you are enrolled in an Advantage plan. In that case, you will receive a Midyear Enrollee Notification of Unused Supplemental Benefits, which will list any benefits you have not used and, among other things, instructions on how to access those benefits and a customer service number to call for additional information.
Who can I turn to?
These and other changes for the 2025 Health insurance plan year make reviewing your coverage even more critical than usual.
Your Annual Notice of Change letter will outline any changes to your plan, including your
- In-network providers
- In-network pharmacies
- The insurer’s formulary, covered drugs list
- Relevant cost changes (deductibles, copays, co-insurances)
A change in any of these factors could affect your choice of plan and your ability to take full advantage of the new CMS regulations. It would help if you also considered any actual or expected changes in your medical or care needs. A qualified health insurance broker or independent agent can help you through the maze of options facing Medicare enrollees. Their service will cost you nothing, but you will enjoy the peace of mind from making an informed decision, and you may save thousands.
