5 Major Medicare Changes in 2025: A Guide for Oregon Residents

5 Major Medicare Changes in 2025: A Guide for Oregon Residents

Annual Open Enrollment is from Oct. 15 to Dec. 7.

Starting in 2025, Medicare will implement several significant changes, some of which are thanks to the Inflation Reduction Act of 2022, championed by AARP. These updates include a cap on out-of-pocket costs for Medicare Part D, set to take effect at the beginning of 2025, as well as capped insulin costs in prescription drug plans, which already went into effect last year.

As the landscape of Medicare continues to evolve, understanding these changes is more important than ever – especially for the one million Oregonians who rely on the program for healthcare. Here is what you need to know about some of the key changes coming up and how they might impact you.

At a Glance:

Increased Support for Caregivers

Healthcare professionals will be able to bill Medicare for time spent instructing family caregivers – improving quality of training and care.

Expanded Mental Health Benefits

Medicare will broaden its coverage for mental health services by allowing more licensed providers to bill Medicare.

Lower Prescription Drug Costs

Out-of-pocket costs for prescription drugs will be capped at $2,000, lowering millions of American’s medication expenses.

Removal of the Coverage Gap (Donut Hole)

The infamous coverage gap, also known as the donut hole, will be eliminated.

More Weight Loss Drug Options

FDA approvals give Medicare beneficiaries access to a wider array of weight loss medications.

 

Increased Support for Caregivers

Caregivers will soon benefit from additional support services that will allow them to better care for their loved ones. These services will include improved training for family caregivers. Under a new rule, doctors and other healthcare providers can bill Medicare for time spent training family caregivers. This ensures that the necessary instruction is provided during work hours instead of personal time – improving the quality of care offered and alleviating some of the burdens for healthcare professionals.

Also starting in 2025, expanded care options for dementia patients will be more accessible. The program, Guiding an Improved Dementia Experience (GUIDE) that launched earlier this year will quadruple. The program serves dementia patients and their caregivers by providing essential services like a 24/7 support line, a care navigator, caregiver training, minimal copayments, and up to $2,500 a year for respite services. Oregon Health and Science University and Providence Health and Services are among the organizations in the state that will be participating in the program.

It is important to note that eligible participants cannot be in hospice or a nursing home. They also must be enrolled in original Medicare and have a dementia diagnosis. To see available programs and when they begin, go to the CMS Innovation website. Select your location and (GUIDE) Model in the left panel. Contact the program to learn more about eligibility and request an assessment.

 

Expanded Mental Health Benefits

Medicare will soon increase coverage for mental health services, addressing the growing need for mental health care among seniors. This change is especially important in Oregon, where a large number of individuals, including seniors, face mental health challenges. According to the Oregon Older Adult Behavioral Health Initiative, one-quarter of older adults have experienced anxiety and depression since the start of COVID-19. Additionally, Oregon has the highest rate in the nation of older adults hospitalized due to opioid-related issues.

These statistics highlight the importance of expanding services, and Medicare is addressing this need. The update will allow licensed marriage and family therapists, mental health counselors, and addiction counselors to bill Medicare for their services. Making 400,000 behavioral health clinicians across the country eligible to enroll as Medicare providers. With this change, more people can access mental health services, as insurance coverage makes these options more affordable.

While the telehealth expansions that were implemented during COVID-19 will end at the start of 2025, Medicare has permanently expanded access to telemedicine for behavioral health services. This change is particularly beneficial for those in rural areas, who do not live close to providers.

 

Lower Prescription Drug Costs

New measures aimed at reducing prescription drug costs will likely provide significant savings for Medicare beneficiaries this upcoming year. The initiative to improve medication affordability will include efforts like negotiating prices and capping out-of-pocket expenses. One of the most significant updates is the $2,000 out-of-pocket cost cap for Medicare Part D. This is the first time in Medicare's history that beneficiaries will have a cap on their out-of-pocket costs.

The financial ceiling is anticipated to benefit millions of individuals. By April of 2024, more than 1.7 million people had already reached $2,000 in out-of-pocket costs on their prescription drugs, according to the Centers for Medicare & Medicaid Services (CMS). Under the updated plan, beneficiaries who hit the new out-of-pocket cap can expect significant savings, averaging around $1,500 – an impressive 56% reduction in their prescription drug costs in 2025, as reported by a recent AARP report.

This modification applies to both Medicare Part D policies and drug coverage in Medicare Advantage plans. The $2,000 cap includes deductibles, copayments, and coinsurance for covered drugs. It does not apply to premiums, Part B drugs, or drugs a plan does not cover.

The Medicare Prescription Payment Plan will be a new option for individuals who are unable to make full payments for their medications upfront. Rather than making singular high payments, Part D enrollees will soon have the choice to spread out their out-of-pocket costs over the year. Although the payment plan does not reduce the total cost, it can help with budgeting.

 

Removal of the Coverage Gap (Donut Hole)

The infamous donut hole will soon be a memory. In 2025 what is left of the coverage gap will be eliminated by the new out-of-pocket costs cap. This will alleviate the financial burden for many beneficiaries who experience soaring out-of-pocket costs for their prescription medications upon entering the coverage gap. Under the new structure, Part D plans can have a deductible of up to $590, then beneficiaries will pay copayments for medications until they reach the $2,000 threshold. This change not only simplifies the process but will also cut costs for individuals with high prescription drug expenses.

While this is a positive change, there are concerns that with a cap on out-of-pocket costs, plan premiums may increase. The 2025 Part D base premium is $36.78, but they can vary depending on location and plan type. It is important to carefully review plans during open enrollment as you may see large variations in premiums, copayments, and covered drugs this year. Additionally, be sure to review the annual notice of change sent by your plan in 2025.

 

More Weight Loss Drug Options

You may find more weight loss drugs covered by Medicare in 2025. Medicare is prohibited from covering drugs prescribed specifically for weight loss, but they can cover weight loss drugs when they are ordered for other purposes. Now included in Part D plans, beneficiaries can access popular medications like Ozempic and Mounjaro for the treatment of type 2 diabetes. As the FDA continues to approve other uses for weight loss drugs, Part D plans can expand their coverage.

 

Local Medicare Enrollment Resources

Senior Health Insurance Benefits Assistance (SHIBA):

SHIBA offers information about Medicare. As part of the Oregon Department of Human Services, Medicare information and counseling services offered through SHIBA are a free public service.

Phone: 1-800-722-4134

Website: Medicare help: Medicare Help: State of Oregon

Aging Services by County:

Each county in Oregon has an aging services office that can help residents understand their Medicare options and access additional support services. You can locate your local office through the resources below.

Oregon Department of Human Services (ODHS)

Website: Oregon Department of Human Services

Aging and Disability Resource Connection of Oregon (ADRC)

Phone: 1-855-673-2372

Website: Aging and Disability Resource Connection of Oregon

 

 


 

Sources:

7 Medicare Changes on the Horizon for 2025

AARP Report: Millions of People on Medicare Prescription Drug Plans to See Savings from New Out-of-Pocket Cap, Starting January 2025 - August 28, 2028

Medicare Enrollment Dashboard | CMS Data

Behavioral Health Challenges for Older Adults and People with Disabilities – Oregon Older Adult Behavioral Health Initiative

What is the Behavioral Health Initiative? – Oregon Older Adult Behavioral Health Initiative