Medicare: What’s New & What’s Next

2025 Medicare Changes

• 2025Out-of-pocket prescription drug costs in Part D plans are capped at $2,000/year. After this, you pay nothing more for covered drugs that year.
• 2025The “donut hole” coverage gap in Part D is eliminated. Coverage is now simpler, with just deductible, initial coverage, and out-of-pocket cap phases.
• 2025You can choose to spread your out-of-pocket drug costs over the year instead of paying all at once (Prescription Payment Plan).
• 2025Part D premiums are slightly lower on average for 2025, but Part B premiums and deductibles have increased (Part B premium is now $185/month).
• 2025Expanded mental health care and new support for caregivers, especially for dementia care.
• 2025Midyear notices from Medicare Advantage plans about unused supplemental benefits (like dental/vision).
• 2025Fewer stand-alone Part D drug plans, but plans are more cost-effective.
• 2025New rules for telehealth: Most telehealth covered only if you’re in a rural facility, except for some mental health services.

Recent Changes (2023–2024)

• 2024No more 5% coinsurance in the catastrophic phase for Part D drugs—high drug spenders now have a cap of about $3,300–$3,800 for the year.
• 2024Expanded eligibility for Extra Help (financial assistance) with Part D.
• 2024Drug price negotiations for 10 expensive drugs (prices take effect in 2026).
• 2024Insulin copays capped at $35/month.
• 2024All ACIP-recommended vaccines free under Part D.
• 2023Insulin copay cap ($35/month) and free vaccines started.
• 2023Faster Medicare coverage start for new enrollees—no more multi-month wait if you sign up late in your Initial Enrollment Period.
• 2023Manufacturers penalized if drug prices rise faster than inflation.
• 2020Medicare Advantage plans allowed to cover more supplemental benefits for people with chronic illnesses.
• 2020Expanded opioid treatment coverage under Part B.

What’s Coming or Being Considered for 2026

• 2026First 10 Part D drugs will have Medicare-negotiated prices, bringing major savings for high-expense medications (for diabetes, heart failure, blood clots, some cancers).
• 2026Payments from the government to Medicare Advantage plans will increase by about 5.06% to support program stability.
• 2026Technical updates to risk adjustment and plan payment calculations.
• 2026Improved oversight and protections for enrollees in inpatient care and for those with both Medicare and Medicaid.
• 2026+Not Finalized: Medicare coverage for anti-obesity medications, AI guardrails in Medicare Advantage, and more transparency/reporting requirements for plans.