Major change coming to Medicare Part D in 2025

Dear Toni: I understand that there will be a major change to Medicare Part D in 2025 with the “doughnut hole” going away. I’m concerned because this year I entered the doughnut hole in July and will exit it in November. This month’s Part D statement explained that my prescription drug costs have exploded for the remainder of 2024.

If the doughnut hole is leaving the Medicare prescription drug plan, how will this affect me? — Melodye, Spring, Texas

Dear Melodye: You are correct: But this is good news. The elimination of the “doughnut hole,” or coverage gap, will help make prescription drugs more affordable for Americans on Medicare.

With this change, your maximum out-of-pocket cost for Part D prescriptions in 2025 will be $2,000. This will be a great relief for many on Medicare.

Here are the costs for 2025:

Initial deductible: $590.

Initial coverage stage: During the five drug tiers of initial coverage, the Part D plan pays its share of the cost of your prescription drugs, and you pay your share until the maximum out-of-pocket amount of $2,000 is met. Then you move to the catastrophic coverage stage.

The five tiers of initial coverage are Tier 1, preferred generic drugs; Tier 2: generic drugs; Tier 3: preferred brand drugs; Tier 4: nonpreferred drugs; and Tier 5: specialty drugs. (Drug tier copays are different depending on which Part D or Medicare Advantage plan with Part D you have chosen.)

Coverage gap: Effective Jan. 1, Medicare’s doughnut hole no longer exists.

Catastrophic coverage: The shift to $0 out of pocket for this stage begins Jan. 1. When a beneficiary enters the catastrophic coverage stage, Medicare will pick up all prescription costs, whether brand name or generic, and those with a Part D plan pay $0.

On Jan. 1 of each year, the process starts all over again with a new Medicare prescription drug plan and new initial deductible and maximum initial coverage limit.

The Medicare prescription payment plan is a new option beginning Jan. 1 to help manage your out-of-pocket drug costs by spreading your monthly prescription drug costs throughout the entire year. For more information about the payment plan, visit Medicare.gov or call your Medicare Part D plan provider.

Here are Toni Says’ tips to help you find a Part D plan:

■ Visit Medicare.gov to view 2025 Medicare Part D and Medicare Advantage plans. The website has a tool to help narrow your search for new plans.

■ Talk to your doctors about which brand-name drugs can be changed to generics.

■ Get samples from your doctor.

■ Search various prescription drug programs such as GoodRx, Single Care or Amazon for lower drug costs. Walmart, Kroger, HEB and Costco also have discount prescription drug plans.

Toni King is an author and columnist on Medicare and health insurance issues. If you have a Medicare question, email info@tonisays.com or call 832-519-8664.