Medicare open enrollment is on the horizon. Now is the time to start thinking about any changes you may want to make to your Medicare coverage. Thanks to the Inflation Reduction Act, some significant changes have come along for Medicare and more will take effect in the near future.
Medicare Open Enrollment
Medicare open enrollment happens once each year. In 2024, the open enrollment period is between October 15 and December 7. Any changes to your Medicare plans will take effect on January 1, 2025. During the open enrollment period, you can:
- Join or drop a Medicare Advantage Plan, switch between Medicare Advantage Plans, or add or drop Medicare prescription coverage.
- Switch from Original Medicare to a Medicare Advantage Plan or vice versa.
- Join or drop a Medicare prescription drug plan, or switch to a different drug plan if you are enrolled in Original Medicare.
If you are already in a Medicare Advantage Plan, you will also have an open enrollment period between January 1 and March 31 of 2025, during which you can:
- switch to another Medicare Advantage Plan (with or without drug coverage);
- drop your Medicare Advantage Plan and return to Original Medicare; or
- join a separate Medicare drug plan.
Learn more about Medicare enrollment periods and how to join the various plans.
Lower Drug Prices for Medicare Members
One of the most significant changes Medicare beneficiaries will see in the coming years is the lowering of prescription drug prices. Under the Inflation Reduction Act (IRA), the federal government was granted the authority to negotiate the prices of certain high-cost medications covered under Medicare. This historic move is designed to reduce out-of-pocket expenses for beneficiaries and lower costs for the Medicare system.
In 2026, the first round of negotiated prices will take effect, affecting the cost of 10 widely used prescription drugs. These drugs were chosen because of their high cost, they are each available only from single sources, and there are no generic or biosimilar competitors. The manufacturers of the drugs are participating in the Negotiation Program voluntarily. This information is subject to change. Learn more on the Centers for Medicare & Medicaid Services (CMS) website.
In addition to the initial 10 drugs, the CMS will pick 15 more drugs by February 1, 2025, that are covered under Medicare Part D to negotiate lower prices for, starting in 2027. For 2028, CMS will negotiate lower prices for 15 more drugs that are covered by Medicare Part B and Part D. Up to 20 more Part B and Part D drugs will be chosen for lower negotiated prices each year after 2028.
More Changes Coming to Medicare
The IRA offers additional changes that will help Medicare beneficiaries on other fronts as well.
- Medicare beneficiaries will have a yearly cap on how much they will have to spend on out-of-pocket prescription drugs covered by Medicare. The cap for 2025 is to be set at $2,000.
- Insulin costs are capped at $35 per month per covered prescription for those who are enrolled in Medicare Part D. This cap may not apply to all insulin products. Check with your care provider to determine whether this applies to you.
- Recommended vaccines will be available at no cost to people who have Medicare prescription drug coverage.
- The Medicare Part D low-income subsidy program (LIS), also known as Extra Help, has been expanded to 150 percent of the federal poverty level (FPL). If your annual income is 150 percent of the FPL, then you may qualify for the Extra Help program.
- Companies that raise the prices of certain drugs faster than the rate of inflation must pay a rebate to Medicare.
Learn More About Medicare and Medicaid
As is typical of health insurance and health care, Medicare and its related plans have nuances and limitations. It is especially important to understand that Medicare is very limited in its coverage of long-term care. Long-term care is expensive and continues to increase in cost. Medicaid is a joint federal and state program which can assist those with long-term care expenses. While Medicare provides very limited coverage, Medicaid is much more extensive. However, because of its restrictions, qualifying for Medicaid can be extremely difficult. But paying for home care, assisted living, and nursing home without it could be all but impossible. Navigating the complex rules of Medicaid on your own could be a nightmare at best and subject you to penalties at worst. Fortunately, though, our experienced professionals can guide you through the Medicaid maze. Our legal team can advise you throughout the application process, ensuring that you (and your spouse, if applicable) retain the maximum income and total assets allowed by law.
If you have questions about Medicare and Medicaid, contact the elder law attorneys at Kurre Schneps for a consultation.
