The Biden administration said “average premiums, benefits, and plan choices for Medicare Advantage and the Medicare Part D prescription drug program will remain stable in 2025.”
The announcement Friday afternoon from the Centers for Medicare & Medicaid Services (CMS) comes ahead of open enrollment when tens of millions of seniors will begin next month to choose or change their Medicare benefits for next year.
During open enrollment, seniors will also be voting for the next President between Democrat and Vice President Kamala Harris and former President Donald Trump, a Republican, on Tuesday, November 5 as well as during early voting in the weeks before the general election date.
Premiums, however, are less likely to be an election issue given most average premiums for drug plans and Medicare Advantage plans are actually decreasing, CMS said.
“Enhancements adopted in the 2025 MA and Part D Final Rule, as well as payment policy updates in the 2025 MA and Part D Rate Announcement, support this stability and increase enrollee protections and access to care for people with Medicare,” CMS said. “In addition, the Inflation Reduction Act is reducing prescription drug costs and delivering more comprehensive benefits than ever before, including an annual $2,000 cap on out-of-pocket drug costs.”
To be sure, billions of federal dollars were spent under what has become the Biden-Harris administration’s signature legislative achievement of the last four years, the Inflation Reduction Act.
Seniors will get more specifics during the upcoming Medicare Open Enrollment, which runs from October 15 to December 7. Next week, private health insurers that administer Medicare Advantage health plans and Medicare drug plans will unveil an array of options that seniors will be able to choose from during the open enrollment period.
It remains unclear, however, until most of these plans release specifics of their offerings starting Tuesday when these insurers unveil co-payments and related cost-sharing of the products they are selling during open enrollment for 2025. Advocates of seniors expect some “distruptions.”
“Millions of seniors could see disruptions to their Medicare Advantage coverage next year, including plan closures, higher out-of-pocket costs, and fewer supplemental benefits that close coverage gaps,” said Mary Beth Donahue, President and Chief Excecutive Officer of Better Medicare Alliance. “This is a direct result of recent Medicare Advantage policy changes. We urge policymakers to ensure stability for seniors moving forward with policies that protect Medicare Advantage.”
But Biden administration officials don’t expect seniors to be disappointed.
CMS said the average stand-alone Medicare Part D plan total premium is projected to decrease from $41.63 in 2024 to $40.00 in 2025.
Meanwhile, the average monthly plan premium for all Medicare Advantage plans, “which includes MA plans that provide prescription drug coverage and MA Special Needs Plans (SNPs), is projected to decrease from $18.23 in 2024 to $17.00 in 2025,” CMS said.
More than half of all eligible Medicare beneficiaries are enrolled in Medicare Advantage plans, which contract with the federal government to provide traditional coverage available in traditional Medicare plus extra benefits and services to seniors, such as disease management and nurse help hotlines with some also offering vision, dental care and wellness programs.
“In 2025, average premiums and benefits for Medicare Advantage and the Medicare Part D prescription drug program are expected to remain stable, and Medicare enrollees will have access to a wide range of affordable Medicare coverage options,” said CMS Administrator Chiquita Brooks-LaSure.
Seniors are encouraged to review their many options, which a KFF analysis reported earlier this week that they don’t often do. KFF’s new research shows that 69% of those eligible Medicare beneficiaries did not compare their own coverage with other Medicare options during the late fall 2021 open enrollment period for coverage that began in 2022.
“Medicare enrollees will have robust coverage choices in Medicare for 2025, and these options include vital enhancements to make sure that plans meet the affordability and coverage needs of people with Medicare,” said Dr. Meena Seshamani, Deputy Administrator and Director of the Center for Medicare. “These improvements include capped annual out-of-pocket costs for drugs at $2,000, more complete access to mental health and substance use disorder treatment services and increased protections from predatory marketing and improper prior authorization practices.”
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