Medicare beneficiaries will pay less for prescription drug coverage and Medicare Advantage plans in 2025. The Centers for Medicare and Medicaid Services (CMS) announced that the average premium for Medicare Part D, which covers prescription drugs, is expected to drop from $33.50 in 2024 to $31.50 in 2025. Similarly, Medicare Advantage plans will see an average premium decrease from $18 to $16 per month.
Approximately 60% of Medicare Advantage enrollees in their current plan will have a zero-dollar premium in 2025. The reduction in premiums is being attributed to policy changes aimed at reducing healthcare costs and increased competition among Medicare plan providers. “Our goal is to make healthcare more affordable and accessible for all seniors,” said a CMS spokesperson.
In addition to lower premiums, Medicare Part D will introduce a new $2,000 annual cap on out-of-pocket prescription costs starting in 2025. This cap will be indexed to the growth in per capita Part D costs and may rise each year after 2025.
Medicare premiums decreasing in 2025
Part D enrollees will also have the option to spread their prescription drug costs over the year rather than face high out-of-pocket costs in any given month. Those selecting this payment option will pay $0 to the pharmacy for covered Part D drugs, and their plan sponsor will bill them monthly for any cost sharing. Furthermore, people with Medicare enrolled in a Part D plan that offers enhanced supplemental benefits will have the advantage of these benefits counting towards their out-of-pocket costs.
This will help them reach the $2,000 cap sooner. The CMS found no significant changes in drug inclusions or tier placements when comparing 2025 Part D formularies to 2024. The average stand-alone Part D plan total premium is expected to decrease from $41.63 in 2024 to $40.00 in 2025.
This announcement comes as part of a broader effort by the federal government to address the rising costs of healthcare in the United States. In recent years, both Medicare Part D and Medicare Advantage plans have seen fluctuating premiums, making this expected decrease a welcome relief for many seniors.
- APNews.”Medicare Advantage shopping season arrives with a dose of confusion and some political implications”.
- Reuters.”US Medicare says Part D and Advantage premiums will fall in 2025″.
- Kiplinger.”Medicare Part D and Advantage Costs Decrease in 2025″.