By Karen Courtney, Director of Programs
Farewell and good riddance! Starting in 2025, the Inflation Reduction Act eliminates the coverage gap (which is otherwise referred to as the “donut hole”). This means that in 2025, Medicare Part D beneficiaries will stay in the initial coverage phase of their prescription copays until their total out-of-pocket spending for formulary drugs reaches the 2025 maximum out-of-pocket Part D spending limit – which is set at $2,000.
Once at that maximum spending limit, Medicare Part D beneficiaries will immediately enter the Catastrophic Coverage level and have a $0 copay (no additional costs) for all on-formulary Medicare Part D drug purchases through the remainder of the year!
NO Medicare Beneficiary, regardless of their income and assets, will pay more than the $2,000 Maximum Out of Pocket annually for formulary drugs. This removes a significant financial burden for people who never qualified for Prescription Extra Help due to their income or assets being too high. The Extra Help program will remain in place for qualifying lower income/lower asset persons.
This Inflation Reduction Act change impacts Part D Drug Plans as well as Medicare Advantage Plans with Part D. Medicare Beneficiaries should open all mail from their current insurer to find out if their current plan is changing its monthly premiums to offset these prescription copay changes. The mandatory “Annual Notice of Change” letters are mailed in September.
MMAP always recommends doing an annual plan comparison at Medicare.gov to learn what your expected costs would be for the coming year, in premiums and copays, and to verify that your current meds will still be on formulary for your plan. MMAP can assist you with those comparisons.
MMAP will begin taking calls to set Open Enrollment appointments beginning mid-September, with appointments starting October 15. Schedule early at (800) 803-7174 to reserve your preferred time and date.