Question: Beyond any changes in Part B premiums, are there other Medicare changes for 2025?
Answer: Yes, we can expect three important Medicare Changes for 2025: a cap on out-of-pocket prescription costs, required notifications from Medicare Advantage plans, and ways to disincentivize Medicare Advantage salespeople.
One major difference to be aware of is a new cap on out-of-pocket prescription costs.
Beginning in 2025, people with Part D plans won’t have to pay more than $2,000 in out-of-pocket costs, thanks to a provision in the Inflation Reduction Act of 2022. The $2,000 cap will be indexed to the growth in per capita Part D costs, so it may rise each year after 2025. Part D enrollees will also have the option of spreading out their out-of-pocket costs over the year rather than face high out-of-pocket costs in any given month.
This new rule applies only to medications covered by your Part D plan and does not apply to out-of-pocket spending on Medicare Part B drugs. Part B drugs are usually vaccinations, injections a doctor administers, and some outpatient prescription drugs.
Among the Medicare changes for 2025, another key difference is a new notification requirement by Medicare Advantage plans. These plans often tout coverage they provide that traditional Medicare doesn’t — dental, vision, hearing and fitness benefits. Still, three in 10 beneficiaries in Medicare Advantage plans said they did not use any of their plan’s supplemental benefits in the past year, according to a study by The Commonwealth Fund.
Starting in 2025, Medicare Advantage plans will be required to send policyholders a personalized “Mid-Year Enrollee Notification of Unused Supplemental Benefits” in July. It will list all supplemental benefits the person hasn’t used, the scope and out-of-pocket cost for claiming each one, instructions on how to access the benefits and a customer service number to call for more information.
The last change is a crackdown on agents and brokers who sell three types of Medicare policies. The Centers for Medicare & Medicaid Services hopes to end sales incentives in 2025 for Medicare Advantage and Part D plans.
Salespeople sometimes get incentives, such as hefty bonuses, when they enroll Medicare beneficiaries into private insurers’ Medicare Advantage plans, Medigap or Part D prescription drug plans. The coming rule change is meant to disincentivize steering people to insurance plans to earn perks and not serve the best interests of Medicare beneficiaries. The new rule prohibits offering incentives to salespeople to enroll people and limits compensation to fixed caps.
©2024 The Kiplinger Washington Editors, Inc. Distributed by Tribune Content Agency, LLC.
Donna LeValley is a staff writer at Kiplinger.com. For more on this and similar money topics, visit Kiplinger.com.
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