If you take a lot of very expensive prescriptions, the Inflation Reduction Act has some great benefits in store for you starting in January of 2025. But for the rest of us, we will end up paying more –much more – for Medicare Part D.
The big news is that your out-of-pocket drug costs are capped at $2,000 per person.
The bad news is the insurance companies are doing many things to recoup that lost money, including raising monthly premiums. Industry experts are expecting double or triple rate increases on your monthly drug plan. But wait, there’s more: in addition to the larger Part D deductible up to $590 per year vs. $545 in 2024, many plans exempted cheap, generic drugs from the deductible. It’s likely in 2025 that all drugs will be subject to the deductible!
Insurance companies are not required to cover all medications. We expect all plans to cover less drugs this year. You might be in the position where one company doesn’t cover all your prescriptions. In that case we find the plan that covers your most expensive Rx at the best price and you pay for the others on your own.
If you take a drug where your out-of-pocket costs are $600 or over, you won’t have to pay when you pick your drug up from the pharmacy. You’ll still pay for it, but not while in CVS or Walgreens. Instead, your insurance company will bill you monthly for 1/12 of the cost of your copay. This is called the Medicare Prescription Payment Plan. MPPP is set to be a nightmare to administer by the insurance companies, but a win for people who take expensive drugs!
Insurance agents cannot share 2025 plan details with the public until Oct. 1. Since millions of people will shop their plans this year and it will be impossible for agencies to help everyone in the timeframe allowed (Oct. 15 to Dec. 7) you need to take several steps to be sure to get the best drug coverage:
- Look for your Annual Notice of Change Letters that all Part D insurance companies must mail you in September. Do not throw this away without reading like you may have in the past.
- If the changes look unattractive, book an appointment with your agent as early as possible. Don’t wait till late November as many agencies will stop taking new Part D clients as it is too close to the deadline.
You can’t change your drug plans until Oct. 15 and the new plan won’t begin until Jan. 1, 2025. But now is the time, when you are not under a time constraint, to think about how these new rules and expected prices increases will impact you.
Sylvia Gordon is co-founder of The Medicare Family, headquartered in Noblesville, where she educates thousands on Medicare and Social Security in all 50 states. You can learn more at TheMedicareFamily.com.