What seniors should know about Medicare open enrollment for 2025

For millions of Americans aged 65 and older, Medicare provides essential healthcare coverage during retirement. And, each fall, Medicare beneficiaries face an important decision: whether to keep their current healthcare coverage or make changes for the coming year. This annual opportunity, known as Medicare open enrollment, allows seniors to evaluate their healthcare needs and potentially switch to coverage that better suits their situation. 

The stakes are high during open enrollment because the choices made during this period will determine your healthcare coverage and costs for the entire year. While you can keep your current coverage if it still meets your needs, failing to review your options could mean missing out on better benefits or cost savings. This is especially true for 2025, as new regulations will cap prescription drug costs at $2,000 annually — a change that may prompt insurance companies to adjust their plans in other ways.

So, whether you're currently enrolled in Original Medicare, a Medicare Advantage plan or a prescription drug plan, there are a few big factors you need to know about open enrollment this year. 

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What seniors should know about Medicare open enrollment for 2025

If you're a senior, here's what you should know about Medicare open enrollment this year:

When Medicare open enrollment happens

This year, Medicare's annual open enrollment period runs from October 15 to December 7 for coverage starting on January 1, 2025. During this window, beneficiaries can make several types of changes to their coverage, including:

• Switching from Original Medicare to Medicare Advantage, or vice versa
• Changing from one Medicare Advantage plan to another
• Joining, switching or dropping Medicare Part D prescription drug coverage
• Moving between Part D prescription drug plans

It's important to note that this fall open enrollment period is different from the Medicare Advantage open enrollment period, which occurs from January 1 to March 31 each year. During the latter period, beneficiaries enrolled in Medicare Advantage plans can switch to a different Medicare Advantage plan or return to Original Medicare.

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What changes are happening for 2025

The most significant change for 2025 is the implementation of a $2,000 annual cap on out-of-pocket prescription drug costs for Medicare beneficiaries. This landmark change applies whether you receive healthcare through Original Medicare or a Medicare supplemental insurance plan. This cap represents a substantial saving opportunity for seniors who require multiple or expensive medications.

However, there is a chance that this new prescription drug benefit may prompt private insurers to adjust other aspects of their coverage plans to maintain profitability. These adjustments could include:

• Changes to monthly premium costs
• Modifications to deductibles and copayments
• Updates to provider networks
• Alterations to additional benefits like dental, vision or hearing coverage

Given these potential changes, beneficiaries should carefully review their current coverage and compare available options during the open enrollment period. This review should include examining not just drug coverage, but all aspects of healthcare needs and associated costs.

What Medicare does (and doesn't) cover

Understanding Medicare's different parts is crucial for making informed decisions during open enrollment. Here's what you should know about the coverage:

Medicare Part A (hospital insurance)

Most beneficiaries pay no premium for Medicare Part A if they or their spouse paid Medicare taxes while working. Here's what Medicare Part A covers:

• Inpatient hospital stays
• Skilled nursing facility care
• Hospice care
• Some home healthcare

Medicare Part B (medical insurance)

Medicare Part B requires a monthly premium based on income. Here's what it covers:

• Outpatient care
• Preventive services
• Medical supplies
• Some home healthcare
• Mental health services

Medicare Part C (Medicare Advantage)

Medicare Part C networks and costs vary by plan and location. It is offered by private insurers as an alternative to Original Medicare. Here's what it covers:

• All Part A and Part B coverage
• Often includes Part D drug coverage
• May offer additional benefits like dental, vision or hearing

Medicare Part D (prescription drug coverage)

Medicare Part D can be added to Original Medicare and is often included in Medicare Advantage plans. Coverage and costs vary by plan. Starting in 2025, Medicare Part D includes the new $2,000 out-of-pocket cap, but it does not cover all medications; each plan has its formulary.

What Medicare doesn't cover

In general, there are several important healthcare services fall that outside Medicare's coverage, including:

• Long-term care (custodial care)
• Most dental care and dentures
• Eye exams for prescription glasses
• Hearing aids and related exams
• Routine foot care
• Acupuncture (except for chronic lower back pain)
• Healthcare outside the United States

For these non-covered services, beneficiaries may want to consider additional coverage through Medicare Advantage plans, standalone insurance policies or Medicare Supplement (Medigap) plans. 

The bottom line

Staying informed and proactive during Medicare open enrollment is important, as it can help you manage healthcare costs, access the best care and reduce financial stress. So, during this year's Medicare open enrollment period, be sure to take time to evaluate your current healthcare needs, review any changes in your existing coverage and explore new options that may better serve your situation. The new prescription drug cost cap presents an excellent opportunity to reassess your coverage choices, but it's still wise to consider the complete picture of your healthcare needs.