The costs associated with your Medicare coverage change every year. The Centers for Medicare and Medicaid Services (CMS) determine Medicare costs based on several factors, including the cost of providing healthcare and inflation. No matter if you are covered by a Medicare Advantage plan or Original Medicare, you will see changes to the cost of your coverage. Here’s what to expect in 2025.
Medicare Advantage
If you have a Medicare Advantage plan, your insurance carrier sets your premium, deductibles, and coinsurances and CMS approves the prices. The Annual Notice of Change letter your insurance carrier sends out every September spells out any changes to your plan for the following year. The out of pocket maximum (the most you will ever have to pay out of your own pocket in a year) cannot exceed $9,350 in 2025. Some plans may set lower amounts. Your Part A premium (if you pay one) and your Part B premium may be changing for 2025, as detailed below.
Part A Hospital Insurance
Premium: If you or your spouse worked 10 plus years, Part A is free. If you don’t qualify for premium-free Part A, what you pay is based on how much you worked. If you or your spouse worked at least 30 quarters, you will pay the reduced monthly premium of $285 – an increase from $278 in 2024. If you worked less than 30 quarters, you will pay the full monthly premium of $518 – an increase from $505 in 2024.
Annual Deductible: The Part A deductible for each inpatient hospital admission is increasing from $1,632 to $1,676. This covers your share of costs for the first 60 days of a Medicare-covered inpatient stay, also known as the benefit period. There is no limit to the number of benefit periods you can have, which means you may pay this deductible more than once during the year.
Coinsurance: Varies with the location and length of your hospital stay.
- Days 1 to 60: $0 after you pay your Part A deductible
- Days 61 to 90: $419 per day, an increase from $408 in 2024
- Days 91 to 150*: $838 per day, an increase from $816 in 2024
*Known as “lifetime reserve days” because Medicare will only pay for these extra days once in your lifetime
Part A deductibles and co-insurances do not apply if you have a Medicare Advantage plan.
Part B Medical Insurance
Premium: The standard Part B premium for most Medicare beneficiaries will be $185 per month in 2025, up from $174.70 in 2024. Those with higher incomes may pay more. Your premium may also be higher if you did not enroll on time and you pay a late penalty.
Annual Deductible: $257, an increase from $240 in 2024.
The Part B deductible does not apply if you have a Medicare Advantage plan.
Medicare Supplement Plans
If you are covered by Original Medicare, you may also have a Medicare Supplement plan to help cover your out-of-pocket costs. These plans are offered by private insurance companies, and monthly plan premiums vary based on the plan chosen, the insurance carrier, and where the insured lives. Premiums usually increase every year. Check with your insurance carrier to see if you should expect a premium increase. Not all plans are available in all areas. In most states if you did not enroll when you were first eligible, you could pay more for a Medigap plan or be denied coverage based on your health.
Annual Deductible: Most plans do not have a deductible. Plans F, G and J have a $2,860 deductible in 2025. (Plan J was discontinued for new enrollees after June 1, 2010. The high deductible version of Plan F is only available to those who were eligible for Medicare before 1/1/2020. High deductible Plan G is available to individuals who are new to Medicare on or after 1/1/2020).
Coinsurance: Varies by plan.
Out of Pocket Maximum: Not all plans have an out of pocket maximum. In 2025 Plan K has an OOP maximum of $7,220 and Plan L has an OOP maximum of $3,610.
Stand-Alone Part D Prescription Drug Plans
Premiums: If you have Original Medicare, you probably also have a Part D prescription drug plan. These are sold by private insurers, and premiums vary by plan. CMS estimates the average Part D premium at $46.50 in 2025, down from $55.50 in 2024. Just like with Part B premiums, you may pay more if you have a higher income. You may also face a late enrollment penalty if you did not enroll on time.
Deductible: This varies by plan, but CMS has set the maximum annual deductible at $590 in 2025 – an increase from $545 in 2024.
Coinsurance: Varies by plan.
Other Important Changes to Part D Coverage in 2025
The Inflation Reduction Act of 2022 includes several provisions targeted at reducing your out-of-pocket drug expenses. In 2023, the cost of insulin was capped at $35 a month. In 2024, out-of-pocket costs associated with the “donut hole” were reduced. In 2025 the donut hole was eliminated completely, capping out of pocket spending on Part D drugs at $2,000 a year. This means that once any deductible, copays and coinsurances you pay total $2,000, your covered prescription medications will be paid in full by your insurer.
In 2025 Medicare also implemented the Medicare Prescription Payment plan. This voluntary program helps break up the cost of your prescriptions into monthly payments. This can be helpful if you have expensive medications that may be difficult to afford. Your insurance company administers the program, and you must enroll through them.
Help Paying for Prescriptions
Extra Help is a federal program that can help you pay your out-of-pocket prescription costs, if you qualify. To receive this support, you can apply online, call Social Security at 1-800-772-1213 from Monday to Friday from 8 am to 7 pm, or make an appointment at your local Social Security office.
A Medicare Agent Can Help
A local, licensed Medicare agent can help ensure you have the right coverage to meet your individual needs. The experienced team at Healthcare Educators is here to help. Contact us today.