Medicare Part D - Pharmacy Plan Changes For 2025

Annual Out-of-Pocket Cap

Starting January 1, 2025, your annual out-of-pocket costs for your Medicare Part D Pharmacy plan will be capped at $2,000. This includes what you pay for during the deductible period and as co-pays/coinsurance. After meeting the out-of-pocket limit, you will pay $0 for COVERED part D drugs for the rest of the year. Note that the medication has to be in your plan formulary to be included in the out-of-pocket cap.

Medicare Prescription Payment Plan

The Medicare Prescription Payment Plan is a new payment option that allows Medicare beneficiaries to manage out-of-pocket prescription drug costs by spreading the costs across the calendar year, beginning January 1, 2025. This voluntary payment plan works with all Medicare Part D prescription drug plans and Medicare Advantage plans with prescription drug coverage.

When a beneficiary decides to participate in the Medicare Prescription Payment Plan, they contact their health or drug plan to sign up. When they fill prescriptions, they will receive a bill from their plan instead of paying the pharmacy for their prescription drugs (including mail order or specialty pharmacies). There is no fee to sign up for the payment plan, but not everyone will benefit from participating, and the plan does not lower total drug costs. Beneficiaries most likely to benefit from participating are those who have high drug costs, especially earlier in the calendar year. CMS is developing a cost preview inside of the Medicare Plan Finder which will be available for Medicare Open Enrollment in the fall of 2024. It will be based on the beneficiary's drug list, showing an estimate of monthly costs with and without this payment option for Part D or Medicare Advantage plans.

Your local SHIP counselor can help you review your Part D plan during Open Enrollment October 15 through December 7th.