“It’s the first time in the history of the Medicare program that people have a cap on how much they could have to pay out-of-pocket” Meena Seshamani, M.D., Director of the federal Center for Medicare.
Several provisions of the Inflation Reduction Act of 2022 related to Medicare will be implemented in 2025. Medicare is evolving, with important changes set to impact beneficiaries next year. Here’s a breakdown of the key updates, summarized from AARP’s article “7 Medicare Changes on the Horizon“.
New Prescription Drug Cap
We can finally say goodbye to the infamous “donut hole” in prescription drug coverage. Out-of-pocket drug expenses will now be limited to $2,000 per year, for prescriptions covered by traditional Medicare or a Medicare Advantage plan. Prescription Drug Plans change the list of medications they cover (called a formulary) every year. It’s important to ensure that the specific doses of the medications you take are covered in your plans formulary. Only covered medications are included in the $2,000 per year cap.
Medicare Prescription Payment Plan
The Medicare Prescription Payment Plan is a new payment option in the prescription drug law that allows you to manage your out-of-pocket Medicare D drug costs by spreading them across the calendar year. In 2025, all plans will offer this payment option, and participation in it is optional.
What this options does is allow you to pay for your medications over the entire year. Since the annual out-of-pocket maximum for 2025 is $2,000 for covered medications, the most you would pay per month is $167.00. This program only applies to out-of-pocket costs for covered prescription medications, not to premiums and deductibles.
Expanded Insulin Savings
Insulin will now to be available for $35 per month for all Medicare recipients. This cap helps make insulin more accessible to the over 3 million Medicare beneficiaries who depend on the life-saving drug.
Enhanced Preventive Care Coverage
Medicare is expanding access to preventive services, including screenings and annual wellness visits, which are critical for early detection of some conditions. This includes routine screenings for cancer, cardiovascular disease, and diabetes. It also includes expanded wellness checks to manage overall health. These services will come at no additional cost to beneficiaries, regardless of the plan they choose, encouraging proactive health management without the worry of unexpected bills.
Free Vaccinations
Building on the existing program that covers flu and pneumonia vaccines, Medicare will now fully cover other recommended vaccines, including the shingles vaccine, without any out-of-pocket expenses. This ensures that seniors are better protected against preventable diseases, particularly those with serious health complications.
Medicare Advantage Expansion
Some Medicare Advantage plans will offer more non-medical services and benefits. Medicare recipients in larger communities may now be able to choose a plan that meets their social needs as well as health maintenance needs. New benefits may include home meal delivery, transportation to medical appointments, access to over-the-counter health items and even air conditioners for those with respiratory conditions.
Most Medicare Advantage plans are location-specific, enrollees who travel or who have more complex medical conditions should carefully examine the details of coverage to ensure they have plentiful in-network options.
Broader Drug Price Negotiations
In 2025, Medicare will significantly expand its ability to negotiate prices directly with pharmaceutical companies for a wider range of high-cost prescription drugs. This change will drive down the prices of critical medications, saving Medicare beneficiaries, as well as the federal government, substantial amounts of money. The negotiation power is aimed at reducing the cost of some of the most expensive drugs on the market, including specialty medications for chronic conditions like cancer, arthritis, and multiple sclerosis.
Expanded Mental Health Services
Medicare will broaden its mental health coverage to include additional types of therapy, counseling, and telehealth services. The goal is to make mental health care more accessible to older adults, particularly those in underserved areas, or individuals with mobility restraints. This change reflects a growing recognition of the importance of mental well-being, particularly in light of the isolation and anxiety many older adults have faced in recent years.
These upcoming Medicare changes promise to enhance the affordability, flexibility, and comprehensiveness of care for seniors. Whether through cost savings on medications, improved preventive services, or expanded mental health coverage, these reforms aim to create a more supportive healthcare system for older adults.
Medicare’s Annual Open Enrollment begins on October 15th and runs through December 7th. Participants should evaluate their plans annually, especially the prescription drug coverage, to ensure they have the best plan. Learn more at Medicare.gov or contact one of our area benefit counseling programs: The Senior Source, The Wellness Center for Older Adults, Area Agency on Aging, Metrocrest Services, Jewish Family Service, and others.
Adapted from: https://www.aarp.org/health/medicare-qa-tool/donut-hole-coverage-gap/
