Changes Coming to Medicare Drug Plans in 2025
New Rules May Help, and Hurt Seniors
The Inflation Reduction Act of 2022 was a sweeping bill that impacted many parts of the American economy. One overlooked area of changes were those made to the Medicare Part D Drug Plan Program. Part D is the means by which over 60 million seniors receive their prescription drugs. Changes are being phased in a period of years, but major changes are coming in 2025. Read below to find out how it may impact you.
Changes to Part D Drug Plans For 2025
Your prescription drug costs will be limited to $2000 a year
No more coverage gap or “donut hole” in drug plans
Buy now pay later comes to RX
All of these sound great, but there will be some good and bad from the changes.
The Positives
Each of these changes is beneficial to seniors. The $2,000 a year limit on out-of-pocket drug costs is far lower than what some currently spend and will help those with high cost drugs immensely.
The elimination of the donut hole is also a win. In the past some seniors experienced price spikes for their prescriptions in the middle of the year. Seeing the cost of your medications go from $50 a month to $350 a month hurts, especially on a fixed income. Starting January 1st 2025, bye bye donut hole!
Lastly plans will offer a program to get prescriptions today, but pay for them over the course of 12 months. Called the Medicare Prescription Payment Program, this will help smooth out drug costs over the course of the year. This will be great if your plan has a deductible or you take high costs medications. You must sign up for the program through your drug insurance company. They will send more info in September or October.
The Negatives
The $2,000 limit only applies to drugs covered on your plan’s formulary. We anticipate drug companies may not cover the same drugs on their formularies to cut costs. If your plan stops covering a drug you take, they are supposed to notify you. The $2,000 limit also will not apply to injections or infusions received in a medical setting.
All of these new positive benefits won’t come cheap. It’s forecast that these changes may cause the monthly premiums for Part D Drug Plans to rise significantly in 2025. You might have a plan that costs as little as $0 a month. We anticipate that may not be the case in 2025.
What You Should Do
If you already have Medicare and a Drug Plan there are some things you should do. We will not know what the changes for 2025 look like until September or October. Every year your company sends a Annual Notice of Changes, or ANOC. Most pitch it without reading it over. This year, pay attention! If you’d like a review for your coverage, schedule one with your agent sooner rather than later.