As the Centers for Medicare and Medicaid Services (CMS) unveils the 2025 Medicare Advantage landscape, beneficiaries across the U.S. can anticipate a broad array of options, largely with affordable monthly premiums. However, nearly 42% of these plans will see an increase in their out-of-pocket spending limits for Part A and Part B services, known as the Maximum Out-of-Pocket (MOOP) limits. Let’s dive into some essential aspects of Medicare Advantage plans for 2025:

Key Points about Medicare Advantage Plans:

1. Comprehensive Coverage: Medicare Advantage plans incorporate Medicare Part A (hospital and inpatient care) and Part B (outpatient and physician services). Many also include drug coverage (MAPD) and, in some cases, non-drug plans (MA) are available.
2. Supplemental Benefits: Many Medicare Advantage plans offer additional health-related benefits, such as dental, vision, and fitness services. Some plans extend coverage to non-health services like meal delivery and transportation for specific situations.
3. Drug Coverage Restrictions: Beneficiaries enrolled in Medicare Advantage plans without drug coverage (MA) typically cannot add a separate Medicare Part D plan, except in cases where the plan is a Private Fee-for-Service (PFFS), Medical Savings Account (MSA), or Cost plan.
4. Difference from Medigap: Medicare Advantage plans are distinct from Medicare Supplement (Medigap) plans. You cannot combine a Medigap plan with Medicare Advantage; they serve different purposes and coverage needs.

Overview of the 2025 Medicare Advantage Landscape

Decrease in Plan Availability, with Lower Monthly Premiums

In 2025, the number of Medicare Advantage plans available across the U.S. will see a slight drop, with approximately 5,218 plans offered, down from 5,377 in 2024. Despite this reduction, beneficiaries can expect lower average monthly premiums, as CMS projects a decrease of $1.23, bringing the average premium to $17.00. Remarkably, over 87% of these plans will offer monthly premiums under $50, with more than half offering a $0 premium.

Changes to the $0 Premium/$0 Drug Deductible Plans

The popular $0 premium and $0 drug deductible (commonly called $0/$0) MAPDs are less common in 2025, representing about 22% of plans, down from 39% in 2024. However, there’s a notable rise in $0/$0 plans offering a “Part B giveback,” which provides beneficiaries a rebate on their Medicare Part B premium.

Higher Out-of-Pocket Limits

One defining feature of Medicare Advantage plans is the cap on out-of-pocket expenses for in-network Part A and Part B services. For 2025, the MOOP limits will vary widely, from as low as $198 to as high as $9,350. Approximately 9.2 million enrollees will see an increase in their MOOP, with increases ranging from $50 to $6,450.

New Part D Out-of-Pocket Cap and Donut Hole Removal

All 2025 Medicare Advantage plans with drug coverage (MAPDs) will include a $2,000 maximum out-of-pocket limit for formulary Part D drugs, eliminating the previous Coverage Gap (Donut Hole). Once beneficiaries hit this limit, they’ll transition to Catastrophic Coverage, where they won’t have any additional costs for their Part D drugs for the remainder of the year.

Insulin and Vaccine Coverage

In line with recent years, all 2025 MAPD plans will continue to cap insulin copays at $35 for a 30-day supply during the deductible and Initial Coverage phases. Vaccines recommended by the Advisory Committee on Immunization Practices (ACIP), including the Shingles and Pneumonia vaccines, will also have $0 cost-sharing.

Key Dates for Medicare Beneficiaries

Open Enrollment Period: The Annual Enrollment Period (AEP) for 2025 Medicare plans starts on October 15, 2024, and continues until December 7, 2024. If you’re currently enrolled in a Medicare Advantage or Part D plan, you should have received an Annual Notice of Change (ANOC) letter detailing any adjustments to your current plan for the upcoming year. Make sure to review it carefully to understand any modifications in coverage, costs, or benefits.

In Summary

Medicare Advantage plans for 2025 offer extensive choices, but it’s essential for beneficiaries to be mindful of potential increases in out-of-pocket limits and shifts in plan structures. With the open enrollment period underway, it’s a prime opportunity for Medicare recipients to evaluate their options and ensure they choose a plan that aligns with their health and budgetary needs. As always, Medicare remains complex, and we’re here to guide you through understanding these changes and selecting the best coverage for you.