2025 Changes to Medicare Resulting from the Inflation Reduction Act
The Inflation Reduction Act (IRA) brought several changes that impact Medicare Advantage (MA) plans during the annual election period. Key highlights include:
OVERVIEW OF 2025 IRA CHANGES TO MEDICARE
Important changes will be arriving to Medicare benefits for 2025, thanks to the Inflation Reduction Act (IRA). These affect most Medicare enrollees with prescription drug coverage. To understand how the IRA first started affecting Medicare plans, see our summary of the 2024 Medicare landscape and Inflation Reduction Act impacts. For a broader look at everything changing this year, see our overview of the big changes coming to Medicare in 2025.
Today we’ll learn:
- Why did these changes happen?
- What are they?
- How may they affect you?
- Next steps so you’re ready.
Why? Inflation Reduction Act. There is good news and bad news.
Good news. Elimination of the coverage gap or donut hole. Maximum of $2000 for prescription drugs for 2025. So, if you are spending a lot on prescriptions or going into the donut hole this is a great thing.
Bad news. Part of the definition of Insurance is shared risk. While some people will spend a lot less this year. Most people will see changes in.
- Premium changes
- Updated copays on different tiers of drugs
- Drugs changing tiers or being removed from the plan
What are the changes?
Benefit changes: In response to increasing plan risk and revenue pressures, we expect many plans will adjust benefit designs by way of higher deductibles and coinsurance in place of copays for certain drugs.
Additionally, the over all co pays for Medicare advantage beneficiaries have gone up for the most part.
In Maine, costs on most plans have increased.
- In patient hospital stay prices.
- Surgery co pays.
Benefits have been reduced.
- Comprehensive dental on some plans has gone away.
- Healthy food card and OTC benefits care reduction for people on Mainecare.
Next Steps: Prepare for Your Plan Updates
Now more than ever, it’s important to watch for your plan’s Annual Notice of Changes (ANOC) letter. If you haven’t received this letter by the end of September, reach out to your plan.
Once you know what the changes are on your plan, Compare the other plans in your area.
Make sure to weigh costs and benefits of any plan that includes Part D coverage.
Look at the Annual Notice of Change on your plan, then look at other plans available in your state.
- Look at star ratings.
- National plan vs. regional plan.
- Deductible amounts for both Medical and Prescriptions.
- What tier levels are included in the deductible phase for Prescriptions.
- Maximum out of pocket for Medical.
- Copays and coinsurance amounts.
- Extra benefits.
How do you stay up to date with changes in Medicare policies and plan options each year?
To stay up to date with changes in Medicare policies and plan options each year, be sure to review your Annual Notice of Change (ANOC), which is sent to you by your Medicare Advantage or stand-alone Part D drug plan. This important document typically arrives in September and outlines all updates to your plan for the upcoming year—such as changes to premiums, copays, drug coverage, or provider networks. It's essential to read it carefully. If you're happy with the changes, no action is needed—your plan will automatically renew. But if something doesn’t work for you, don’t wait. Contact a local licensed Medicare agent during the Annual Enrollment Period (October 15–December 7) to review other options that may better fit your needs. Staying informed each year ensures you're not caught off guard and that your plan continues to match your health and financial situation.Know your Medicare Advantage advocate
- Do not call the T.V. for Medicare advice. Find a local person you can talk to in person.
- Do not answer the phone and talk to anyone about Medicare unless you requested information from that person.
- Do seek help from a local Medicare advocate
Author Bio: Vincent Murray, Local Medicare Advocate works with Maine Medicare Choices, an independant Medicare agency representing all 6 Medicare advantage plans in Maine.. I have been helping Seniors with Medicare advantage for the past 10 years. Serving central and northern Maine. Additional information can be found at MaineMedicareChoices.com.