The biggest changes Medicare is making in 2025

Medicare is raising premiums, changing how much you pay for drugs, and adjusting coverage rules starting January 1, 2025. The changes affect everyone on Medicare, whether you have Original Medicare, a Medicare Advantage plan, or a Medigap policy. Some changes save you money; others cost more. Knowing what shifts on January 1 helps you decide whether to stay with your current plan or switch during the open enrollment period that runs through December 31, 2024.

The most visible change is the Part B premium — the monthly charge for doctor visits and outpatient care. The standard Part B premium is rising to $185 per month in 2025, up from $175.50 in 2024. If you have higher income, you pay a surcharge on top of that. Part D premiums (prescription drug coverage) are also changing, though the amount varies by plan and region. Medicare Advantage plans are adjusting their premiums and out-of-pocket limits as well.

Key Takeaways

  • Part B premiums are rising to $185 per month in 2025, and higher-income beneficiaries pay additional surcharges based on their tax return from two years prior.
  • The Part D deductible is increasing, and the coverage gap (donut hole) is narrowing, meaning you pay less for brand-name drugs once you reach that threshold.
  • Medicare Advantage plans are changing their premiums, copays, and out-of-pocket maximums, so your current plan may not be the lowest-cost option in 2025.
  • You can switch plans during open enrollment (October 15 to December 7, 2024) without penalty, even if you have a pre-existing condition.
  • Some plans are being discontinued or merged, so you may receive a notice that your current plan no longer exists in your area.

Part B premium and income-related surcharges

If you are on Original Medicare, you pay Part B premiums directly to Medicare. The standard premium for 2025 is $185 per month. Most people have this amount deducted from their Social Security check automatically. If you do not receive Social Security, Medicare bills you monthly.

Higher-income beneficiaries pay more. Medicare uses your Modified Adjusted Gross Income (MAGI) from your tax return from two years before — so 2025 premiums are based on your 2023 tax return. If your income exceeds certain thresholds, you pay an Income-Related Monthly Adjustment Amount (IRMAA) on top of the standard premium. For 2025, if you are single and your MAGI is over $103,000, you begin paying a surcharge. If you are married filing jointly and your MAGI is over $206,000, the surcharge applies. The surcharge can range from about $70 to $560 per month, depending on your income level.

If your income drops significantly — because you retire, lose a job, or have a major life change — you can ask Medicare to recalculate your surcharge. You will need to file a form called the Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event (form CMS-L564) and provide proof of the change.

Part D drug coverage changes and the coverage gap

Part D is prescription drug coverage, offered through private plans. In 2025, the Part D deductible is rising to $545, up from $505 in 2024. This is the amount you pay out of pocket before your plan's coverage kicks in. Once you meet the deductible, you typically pay a copay or coinsurance for each prescription.

The coverage gap — often called the "donut hole" — is the range of drug costs where you pay a larger share. In 2025, the gap is narrowing. Once your total drug costs (what you and your plan pay combined) reach $11,000, you enter catastrophic coverage, where you pay only 5 percent of the cost of brand-name drugs and generics. This is a lower percentage than in previous years, which means you save money once you reach that threshold.

Many Part D plans are also changing their formularies — the list of drugs they cover. A drug your plan covered in 2024 may require prior authorization in 2025, may move to a higher cost tier, or may no longer be covered at all. If you take regular medications, check your plan's 2025 formulary before open enrollment ends. If your current plan no longer covers a drug you need at an affordable cost, switching plans during open enrollment is one option.

Medicare Advantage plan changes and out-of-pocket limits

Medicare Advantage (Part C) plans bundle hospital, doctor, and usually drug coverage into one plan offered by a private insurer. In 2025, many plans are raising premiums and adjusting copays and deductibles. The maximum out-of-pocket limit — the most you can spend in a year before the plan covers everything at no cost — is also rising. For 2025, the limit is $8,550 for in-network care, up from $8,300 in 2024.

Some Medicare Advantage plans are being discontinued or merged with other plans. If your plan is being discontinued, Medicare will send you a notice by October 2024. You will be automatically moved to another plan in the same company if one exists in your area, or you can switch to a different plan during open enrollment. You are not locked in — you can change plans even if you have a pre-existing condition.

Medicare Advantage plans often offer benefits Original Medicare does not, such as dental, vision, or hearing coverage. These benefits vary widely by plan and region. If you are considering switching to Original Medicare, understand that you will lose these extra benefits and will need to purchase a separate Medigap policy and Part D plan to cover gaps in Original Medicare.

Medigap policy changes and rate increases

Medigap policies are supplemental insurance sold by private companies to cover the gaps in Original Medicare — copays, coinsurance, and deductibles. Medigap premiums are rising in 2025, though the amount depends on your state, your age, and which Medigap plan (A, B, D, G, N, or M) you have. Some states regulate how much insurers can raise rates; others do not. Contact your current Medigap insurer or get quotes from other companies to see what 2025 rates will be.

Medigap Plan G is the most popular choice for new beneficiaries because it covers the Part B deductible. In 2025, as the Part B deductible rises, Plan G premiums are likely to rise as well. If you are turning 65 and enrolling in Medicare for the first time, you have a six-month window to purchase Medigap without medical underwriting — meaning the insurer cannot deny you or charge more based on your health. This window starts the month you turn 65 and are enrolled in Part B. If you miss this window, insurers can charge more or deny coverage based on pre-existing conditions.

When and how to review your coverage for 2025

Open enrollment for Medicare runs from October 15 to December 7, 2024. During this period, you can switch from Original Medicare to a Medicare Advantage plan, from a Medicare Advantage plan to Original Medicare, or from one plan to another. Changes take effect January 1, 2025.

Start by reviewing your current plan's 2025 costs and coverage. Medicare sends an Annual Notice of Change (ANOC) to everyone on a Medicare plan. This notice lists premium changes, copay changes, and formulary changes for your specific plan. Read it carefully. You can also visit Medicare.gov, enter your zip code, and compare all plans available in your area side by side.

If you are on a Medicare Advantage plan, compare the 2025 out-of-pocket maximum, copays for your doctors, and whether your current doctors are still in-network. If you are on Original Medicare with a Medigap policy, compare Medigap rates from multiple insurers — rates vary significantly by company even within the same state. If you take prescription drugs, use the Medicare plan finder to see which plans cover your medications at the lowest cost.

Special situations: Life changes and plan discontinuations

If your plan is being discontinued, Medicare will automatically enroll you in another plan if you do nothing. However, you are not required to accept that assignment. You can choose a different plan during open enrollment, or you can request a Special Enrollment Period if you want to switch outside of open enrollment. A Special Enrollment Period allows you to change plans without waiting for the next open enrollment if you have a may have access to life event — such as moving to a new state, losing employer coverage, or having your plan discontinued.

If you move to a new state or county in 2024, you may have different plans available in 2025. Some plans are regional and do not serve all areas. Check which plans are available in your new location before your move takes effect, and switch plans if needed during open enrollment or through a Special Enrollment Period.

If you are still working and have employer health coverage, understand how Medicare coordinates with your employer plan. If your employer has 20 or more employees, your employer plan is primary and Medicare is secondary. You may not need to enroll in Part B when ready, but delaying enrollment can result in a permanent penalty. Speak with your employer's benefits administrator and Medicare before making enrollment decisions.

Questions to ask your doctor and Medicare

Before open enrollment ends, contact your doctor's office and ask whether they accept your current plan in 2025. Ask whether any of your regular medications are on your plan's 2025 formulary and at what cost tier. If you are considering switching to a different plan, ask your doctor whether they participate in the new plan's network.

Contact Medicare directly at 1-800-MEDICARE (1-800-633-4227) if you have questions about your coverage, premiums, or whether you may have access to for a Special Enrollment Period. You can also visit Medicare.gov to use the plan comparison tool, read your plan's ANOC, and enroll in a new plan online. If you need help in person, contact your local State Health Insurance information Program (SHIP), which offers free counseling about Medicare options.

Frequently Asked Questions

Do I have to switch plans if my current plan's premium is going up?

No, you can stay with your current plan even if the premium increases. However, comparing other plans during open enrollment may reveal a lower-cost option that covers your doctors and medications. You have until December 7, 2024, to switch without penalty.

What happens if my plan is discontinued?

Medicare will automatically move you to another plan in the same company if one exists in your area. You will receive a notice at least 30 days before the change. You can accept the automatic assignment or choose a different plan during open enrollment. You are not locked in.

Can I switch from Medicare Advantage back to Original Medicare in 2025?

Yes, during open enrollment (October 15 to December 7, 2024), you can switch from a Medicare Advantage plan to Original Medicare. If you do, you will need to purchase a Medigap policy and a Part D plan separately. You have a 63-day window to purchase Medigap without medical underwriting if you are switching from Medicare Advantage.

Will my income-related surcharge change if my income dropped?

Medicare uses your tax return from two years prior, so 2025 surcharges are based on your 2023 income. If your income dropped significantly in 2024 due to retirement or job loss, you can file form CMS-L564 to request a recalculation. You will need to provide proof of the change.

How do I know if my medications are covered under a plan's 2025 formulary?

Visit Medicare.gov and use the plan comparison tool. Enter your medications, and the tool will show which plans cover them and at what cost. You can also call the plan directly or check the plan's website for its 2025 formulary.