Medicare Open Enrollment Ends in 15 Days. Here Are 9 Changes for 2025

1. You Won’t Spend More Than $2,000 for Drug Copays and Coinsurance Under Part D

In 2025, a new approach will replace previous confusing and frustrating Medicare Part D phases, including the elimination of the infamous “donut hole” coverage gap and a new hard limit of $2000 per year on what you’ll have to spend out-of-pocket for covered drugs. 

This limit is “good for people who take a lot of drugs and pay a lot in copays because they can blow through $2,000 quickly,” said Jason Rubin, an independent insurance agent in Southern California who specializes in Medicare, among other coverage.

Here’s how the phases will work: 

1. Deductible phase: If your Medicare Advantage drug plan or standalone Part D plan requires a deductible, you’ll pay 100% of your prescription drug costs until you spend $590, which is the Part D deductible for 2025.
2. Initial coverage: You’ll pay 25% coinsurance for covered drugs until you’ve paid $2,000 out of pocket.
3. Catastrophic: After you’ve hit the $2,000 threshold for out-of-pocket spending on your medications, you pay nothing else out of pocket for 2025. Part D enrollees who reach the catastrophic threshold will save about $1,300 on drug costs in 2025 compared to 2024, according to a Kaiser Family Foundation (KFF) review. In future years, the $2,000 limit will increase due to inflation.

Unfortunately, these out-of-pocket limits do not apply to Part B drugs provided by a medical professional in an outpatient hospital setting. Chemotherapy treatments, for example, may fall into this category. 

2. Medicare Advantage Plans That Include Part D May Change Costs or Coverage 

Average premiums, deductibles, and out-of-pocket costs for Medicare Advantage (MA) plans that include prescription drug programs (MAPDs) are changing, with some costs increasing and others going down. Some of these plans are also introducing new formularies or reducing benefits. 

The good news is that the average premium for an MAPD is decreasing from $15.56 in 2024 to $13.50 in 2025.

But other costs are rising. The average Medicare Advantage drug plan deductible for 2025 will be more than double what it was in 2024, going from $146.37 to $306.10, according to Investopedia research.

Our research also found a 7.1% increase in the average out-of-pocket maximum for Medicare Advantage plans with Part D. An out-of-pocket maximum tells you the most you’ll have to pay for covered services in a year. The lower, the better.

Benefits May Be Cut

Some Medicare Advantage plans are also reducing benefits such as dental coverage, Rubin noted. More Medicare Advantage plans feature “a very high max out-of-pocket [limit] for in- and out-of-network costs, with embedded Part D drug plans that have deductibles all over the place.” 

David Lipschutz, co-director of the Center for Medicare Advocacy, said insurers might be taking these actions because, in addition to becoming more responsible for Part D costs due to the $2,000 out-of-pocket cap, they also received a limited increase in government payments for 2025.  

“This year, the plans didn’t get as much raise in payments as anticipated,” Lipschutz said. “They get paid considerably and overpaid by all independent estimates. To grow profit margins, plans may cut benefits and pull out of unprofitable areas, but these are business decisions.”

He warned Medicare beneficiaries to look for changes to other parts of Medicare Advantage plans, including costs and coverage changes for their doctor or other providers. 

Insurers May Raise Barriers to Drug Coverage

One of Rubin’s biggest concerns for 2025 was that some Medicare Advantage and stand-alone Part D plans would remove costly drugs from their formularies (lists of covered prescription medications). Thankfully, that didn’t happen. 

However, insurers could still make changes that force you to jump through more hoops for drug coverage. 

“Your doctor may need to give clinical information on why that drug is necessary for you, or you’ll have to first try another drug through step therapy, such as a generic,” Rubin added. “Then, once the non-formulary drug is approved, we don’t know the cost.” 

3. Standalone Part D Plans May Change Your Costs or Coverage

For Part D drug plans sold outside of Medicare Advantage, the news about costs is also mixed. Nationwide, the average projected Part D standalone premium fell from $41.63 in 2024 to $40.00 in 2025.

But rising or falling premiums vary by state and plan.  KFF noted that in California, among the 16 most popular standalone Part D plans, premiums increased between $4.80 and $35 per month for 10 plans and decreased between $1.60 and $62.40 for the other six. The state’s most popular standalone Part D plan, Wellcare Value Script, hiked premiums from $0.40 to $17.40 in California.

The more stable national average is due to government actions taken to soften standalone Part D premium increases. The Centers for Medicare Services (CMS) capped Part D year-over-year premium increases in 2025 to $35 as part of a one-year “demonstration” or experiment to help stabilize Part D premiums during the transition to the new rules. Insurance companies can choose to continue to participate for two more years. 

Deductibles and Other Out-of-Pocket Costs

While premiums are going down, other costs are going up.  The average Part D deductible increased from $383.75 in 2024 to $466.49 in 2025, but there are slightly more plans with a $0 deductible, according to Investopedia research. 

Other out-of-pocket costs may change in your Part D plan for 2025. “Tier 3, 4, and 5 drugs may have a percentage cost,” or coinsurance, versus flat copays, Rubin said. A coinsurance may end up costing you more.

The same is also true of MAPD plans. 

Fewer Plans Available Nationwide

You may find you have less choice for standalone Part D plans. KFF found fewer available for 2025. Whereas there were 709 plans offered nationwide for 2024, enrollees have only 524 plans to choose from in 2025.

4. You Can Choose to Pay Your Drug Copays and Coinsurance Over Time 

In 2025, you can spread out the cost of medications over a period of months rather than paying everything you owe every time you pick prescriptions up from the pharmacy. A new optional payment plan can ease budgeting, particularly for expensive drugs. 

While we don’t know yet exactly how the payment plans will work, you’ll likely opt into the plan with your Medicare Part D provider, according to the Patient Access Network (PAN) Foundation, a nonprofit organization that helps people with certain diseases pay for prescription medications. Once you opt in, you’ll pay monthly bills for covered out-of-pocket prescription costs up to the $2,000 per year limit.

Your month-to-month amount will change depending on the cost of your drug, the month you filled the prescription at a pharmacy, and any premiums or deductibles due. However, because out-of-pocket expenses are capped at $2,000 annually, you won’t pay more than $166.67 per month ($2,000 divided by 12). 

5. Medicare Part A and B Costs Will Go Up

Costs related to Original Medicare (Parts A and B) change every year, and 2025 sees increases for all components. The Medicare Part A (hospital insurance) deductible will climb 2.7% next year, from $1,632 per benefit period to $1,676. You’ll also pay 2.7% more when you receive care, with coinsurance rates for hospital stays edging up across the board. 

Your Part B premium for doctor visits will rise as well, jumping 5.9% to $185.00 per month. And the Part B deductible will go up from $240 in 2024 to $257 in 2025. 

Other Part B changes in 2025 include increased income-related adjustment amounts charged to higher-income beneficiaries.

6. You’ll Receive a Mid-Year Notice About Unused Medicare Advantage Benefits

If you’re a Medicare Advantage enrollee, you’ll get a new letter in mid-summer 2025. Between June 30 and July 31, 2025, you’ll receive a personalized “Mid-Year Enrollee Notification of Unused Supplemental Benefits.”

This letter will list any supplemental benefits, such as vision or dental coverage, that you haven’t used in the first six months of 2025 and include: 

• The benefit’s scope
• Cost-sharing for the benefit
• Instructions on how to access the benefit
• Network information
• Customer service number to call for more information

The letter attempts to address the issue of unused benefits and unspent funds being funneled back into Medicare Advantage marketing efforts rather than providing services. A 2024 Commonwealth Fund survey found that three out of 10 MA recipients didn’t use any available benefits.

In 2022, almost 100% of Medicare Advantage plans offered at least one supplemental benefit, with 23 supplemental benefits as a median. The most frequently provided benefits through Medicare Advantage plans include vision, hearing, fitness, and dental benefits. 

“On one hand, you have plans offering attractive supplemental benefits to induce people to enroll, and the plans get extra money for offering extra benefits,” Lipschutz said. “Review the benefits plans offer and use them if needed.”

7. You’ll Have Better Access to Lower-Cost Biosimilar Prescription Drugs

The CMS is finalizing changes to increase Part D insurance providers’ ability to make midyear biosimilar drug substitutions for an FDA-approved formulary product. 

A biosimilar drug is close in structure and function—but not completely identical—to the original biological medicine and is often available at a lower cost. (Biosimilars are not the same as generics, which are bioequivalent to the original brand-name drugs.) Biosimilar medications are used for many conditions, including diabetes, chronic skin conditions, arthritis, and some cancers.

This Medicare change in 2025 could increase your immediate access to lower-cost medications without a wait. 

8. Your Access to Mental Health Professionals May Increase

Starting in 2025, more mental health providers can enroll as Medicare providers, including addiction counselors, licensed mental health counselors (LMHCs), and marriage and family therapists (LMFTs). 

Medicare Advantage plans must verify (such as through claims data or electronic health records) that a newly added counselor or therapist has provided behavioral health services to at least 20 patients within the past 12 months. 

This step hopes to help broaden verified covered services and specialists and combat what Senate Finance Committee Chair Ron Wyden, D-Ore., called “ghost networks,” or plan networks featuring providers unavailable to patients. Those providers may have left the network, are no longer seeing new patients, or are otherwise unavailable—leading to beneficiary frustration and unmet mental health needs.

9. Medicare Advantage Plans Must Examine the Impact of Prior Authorizations 

Almost all Medicare Advantage enrollees must get prior authorization for higher-cost services to manage healthcare usage and lower costs. Denials for coverage have risen in recent years, and although most denials are overturned on appeal, the vast majority (9 out of 10) aren’t appealed. These prior authorization requirements and burdensome processes impose barriers and delay care.

In 2025, Medicare Advantage plans must evaluate how prior authorization policies impact certain at-risk populations and publicly display analysis results on their websites.

Then starting in January 2026, insurers must respond to prior authorization requests in seven calendar days (shortened from 14).   

These changes follow a 2024 change stating that Medicare Advantage plans’ requirements for prior authorization can’t lead to more restrictive coverage than traditional Medicare. They can only confirm a diagnosis or the medical necessity of a requested service. 

Other Medicare Changes

Other CMS announcements have laid out more than a dozen changes to Medicare in coming years. Here are two that may impact you soon.

• Dementia Support Programs: In 2025, a new program called Guiding an Improved Dementia Experience (GUIDE) will offer services to people with dementia and their unpaid caregivers, aiming to keep patients at home longer.
• More Part D Drugs Negotiated: In 2023, Medicare negotiated prices for 10 of the highest-spending, brand-name Part D drugs without competitors, and it published prices in 2024. CMS will negotiate prices for 15 more drugs in 2025, with prices going into effect in 2027.

How to Deal With 2025 Medicare Changes 

Both experts we spoke with said few beneficiaries actively compare plans and make changes. Most beneficiaries simply let their current plan renew. In 2025, it’s critical to pay attention to changes, Lipschutz said. 

“We say this every year, but because of the [Inflation Reduction Act] changes, you need to shop around and ensure your drugs are covered under your plan,” Lipschutz said. “Unfortunately, MA and Part D private plans have built a system for savvy, active, and engaged consumers. The system relies on people to compare choices and make decisions in their best interest.”

“But often, that just doesn’t happen,” Lipschutz said. “People decide based on the premium or brand name, don’t compare plans at all, or go through it once, say they’re done, and stick with what they have. Inertia prevents people from doing the homework they should be doing.”

Review Your Annual Notice of Changes (ANOC) Letter 

Carefully look over your letter. Your ANOC should have arrived in September 2024 and outlined changes to your Medicare Advantage plan in 2025. If you didn’t get it in the mail, you should be able to access it online, or you can call your Medicare Advantage plan provider. The letter should include changes to your:

• In-network provider list
• In-network pharmacy list
• Drug list or formulary
• Cost changes

Review Drug Coverage and Costs

Ensure any medications you take today are still covered, and determine if the drug’s tier (and your costs) have changed.

Work with an agent who gives you the time you need to run through all your medications and see what plan comes back as the best fit for you, Rubin advised. You can also go to Medicare.gov and type your drugs there, or call Medicare directly at 800-MEDICARE to ask which plans best suit you. Compare the cost and best advice.

Review Costs Holistically 

The costs that impact your budget go far beyond your monthly premiums. Your deductibles, copays, and ease of access to services all figure into the final amount. Can you afford any changes outlined regarding the premium, provider and pharmacy networks, maximum out-of-pocket costs, or copays or coinsurance?

“While premiums are an important factor, we urge consumers not solely to rely on monthly premiums when choosing a plan,” Lipschutz said. “If you always go for the lowest premium, you may get what you pay for. Low premiums often mean higher costs or a less robust formulary, which applies to MA plans too.”

Look for a Recommended Agent or SHIP Representative

It’s hard to tell if a salesperson leads you toward a plan just to earn a commission, Lipschutz said. “The process is opaque from the consumer standpoint, who has no idea that an agent or broker is earning a commission to encourage an enrollment.”  

You can find an agent recommended by friends or family or attempt to get help from a State Health Insurance Assistance Program (SHIP), which provides free Medicare counseling. But he warns that these programs can get overwhelmed because they’re often underfunded.