What's changing with Medicare costs in 2025

Medicare premiums, deductibles, and out-of-pocket limits all shift each year based on inflation and program costs. For 2025, these amounts have been set, though the exact figures vary depending on which part of Medicare you use and when you enrolled. The changes affect what you pay monthly, what you owe before coverage kicks in, and how much you might spend before Medicare picks up the full bill.

The Social Security Administration announced the 2025 figures in October 2024. If you get Social Security benefits, your Medicare Part B premium is deducted automatically from your check. If you pay Medicare directly, you'll see the new amount on your bill starting in January 2025.

Key Takeaways

  • Part B premiums (doctor visits and outpatient care) increased for 2025, with the exact amount depending on your income and when you first enrolled in Medicare.
  • Part A deductibles (hospital stays) and Part B deductibles (doctor visits) both went up for 2025 compared to 2024.
  • If you're on Social Security, your Part B premium increase may be offset by your Social Security cost-of-living adjustment, though this varies by person.
  • Part D prescription drug plans set their own premiums and deductibles, so costs vary widely by plan and pharmacy.
  • You can review and change your Medicare plan during the annual open enrollment period, which runs October 15 through December 7 each year.

Part B premiums and income-related amounts

Part B covers doctor visits, outpatient services, and some preventive care. The standard Part B premium for 2025 increased from 2024. However, if your income is above a certain threshold, you pay a higher amount called an Income-Related Monthly Adjustment Amount (IRMAA).

IRMAA brackets are based on your modified adjusted gross income from two years prior. For 2025 coverage, Medicare looks at your 2023 tax return. If your income has dropped since then—because you retired, had a major life change, or lost a spouse—you can request that Medicare use your current year's income instead. This is called a life-changing event appeal, and you file it with Social Security.

If you enrolled in Medicare before age 65 or delayed enrollment, your premium may be different. Those who delayed Part B enrollment pay a permanent surcharge of 10 percent for each year they didn't sign up when first may be able to access.

Part A deductibles and hospital costs

Part A covers hospital stays, skilled nursing facility care, and some home health services. The Part A deductible—the amount you pay out of pocket before Part A coverage begins—increased for 2025. This deductible applies per hospital stay, not per year, so if you're admitted multiple times in one year, you may owe the deductible more than once.

Part A also has a daily coinsurance amount for hospital stays longer than 60 days. This amount also increased for 2025. Most people don't pay a Part A premium if they or their spouse paid Medicare taxes for at least 10 years, but the deductible and coinsurance still explore.

Part B deductibles and what you owe at the doctor

Part B has its own deductible, separate from Part A. Once you meet the Part B deductible in a calendar year, you typically pay 20 percent of the cost for most services, and Medicare pays 80 percent. The Part B deductible increased for 2025.

Some services—like preventive care, certain screenings, and vaccines—have no deductible and no coinsurance. You pay nothing for these covered preventive services. If you're unsure whether a specific service is preventive, ask your doctor's office before your visit, or check Medicare.gov.

Part D prescription drug plan changes

Part D plans are run by private insurance companies, not Medicare directly. Each plan sets its own premium, deductible, and list of covered drugs. Premiums and coverage can change year to year, even if you stay with the same plan. Some plans may increase their premium, while others may decrease it or change which drugs they cover.

If you're in a Part D plan, you receive a notice each fall showing your plan's 2025 costs and any changes to the drugs it covers. Review this notice carefully. If your current plan's costs have gone up significantly or if a drug you take is no longer covered, you can switch to a different Part D plan during open enrollment (October 15 through December 7).

If you don't have Part D coverage and go without it for more than 63 days in a row, you may owe a permanent penalty when you do enroll. The penalty is based on how long you went without coverage.

How Social Security adjustments affect your net cost

If you receive Social Security benefits, your Part B premium is deducted from your monthly check. When both Social Security and Medicare premiums change, the net effect on your check depends on the size of each increase.

Social Security's cost-of-living adjustment (COLA) for 2025 was announced at the same time as Medicare changes. For some people, the COLA increase is larger than the Medicare premium increase, so their take-home check goes up. For others, the increases are similar in size, so the net change is small. A few people may see little or no COLA increase, in which case the Medicare premium increase reduces their check.

If you're not yet on Social Security but are on Medicare, you pay your Part B premium directly to Medicare, usually by mail or automatic bank draft.

Medigap and Medicare Advantage plan costs

If you have a Medigap (supplemental insurance) policy, your premium is set by the insurance company, not Medicare. Medigap premiums can increase each year based on the insurer's costs and claims experience. You'll receive a notice from your Medigap company if your premium is changing for 2025.

If you're in a Medicare Advantage plan (Part C), your plan premium, deductible, and copays are set by the insurance company. These can change year to year. Medicare Advantage plans must cover everything Original Medicare covers, but they may have different costs and networks. During open enrollment, you can compare your current plan's 2025 costs with other plans available in your area.

When and how to review your coverage

The Medicare open enrollment period runs from October 15 through December 7 each year. During this time, you can switch from Original Medicare to a Medicare Advantage plan, switch between Medicare Advantage plans, switch Part D plans, or switch Medigap policies. Changes take effect January 1 of the following year.

To compare plans and see what your costs would be under different options, visit Medicare.gov and use the Plan Finder tool. You can enter your current drugs, doctors, and hospitals to see which plans cover them and what your out-of-pocket costs would be. You can also call 1-800-MEDICARE to speak with a representative who can walk you through your options.

Frequently Asked Questions

Will my Social Security check go down because of the Medicare premium increase?

Not necessarily. Your Social Security benefit increases each year by a cost-of-living adjustment. If that increase is larger than your Medicare premium increase, your net check goes up. If the COLA is smaller than the premium increase, your check may go down slightly. The exact impact depends on your specific amounts.

Can I change my Medicare plan if costs went up too much?

Yes. Open enrollment runs October 15 through December 7 each year. You can switch to a different Part D plan, a different Medicare Advantage plan, or from Original Medicare to Medicare Advantage (or vice versa). Changes take effect January 1. You can also switch Medigap policies during this time, though some insurers may require a new health screening.

What if my income dropped this year and my IRMAA is too high?

You can request that Medicare recalculate your IRMAA based on your current year's income instead of your 2023 tax return. This is called a life-changing event appeal. File it with Social Security if you had a major life change like retirement, job loss, or death of a spouse. You'll need to provide documentation of the change.

Do I have to pay the Part B deductible every year?

Yes. The Part B deductible resets on January 1 each year. Once you've paid it in a calendar year, you typically pay 20 percent coinsurance for most services for the rest of that year. The deductible amount itself increases each year.

Why did my Part D plan premium go up so much?

Part D plans are run by private insurers, and each sets its own premium based on the drugs it covers, its claims costs, and market competition. If your plan's costs increased significantly, you can switch to a different Part D plan during open enrollment. Some plans may have lower premiums, though they might cover different drugs or have different pharmacies in their network.