What is going on with Medicare Advantage plans for 2025?

Oct 16, 2025 3 min read •

senior care Medicare Healthy Aging

With more than half of all eligible Medicare beneficiaries enrolled, understanding plan updates is crucial. This article provides a comprehensive overview of what is going on with Medicare Advantage plans for 2025, detailing the key changes, costs, and benefits you need to consider.

Quick Summary

For 2025, Medicare Advantage plans bring significant prescription drug changes, including a new $2,000 out-of-pocket cap, expanded behavioral health access, and refinements to Special Needs Plans (SNPs). Premiums are projected to remain stable, although plan-specific benefits are shifting, and average Star Ratings have seen a decline.

Key Points

$2,000 Annual Drug Cap: For 2025, a new $2,000 annual out-of-pocket maximum on covered Part D prescription drug costs will take effect, providing major financial relief for many.
End of the 'Donut Hole': The new out-of-pocket cap effectively eliminates the coverage gap, so there is no longer a gap in coverage for prescription drug costs.
Expanded Behavioral Health Access: More mental health professionals, including marriage and family therapists, can now bill Medicare, increasing access to behavioral healthcare.
Stable Premiums, Shifting Benefits: While average premiums are projected to be stable or slightly lower, the availability of certain supplemental benefits like transportation and over-the-counter allowances may have declined.
Declining Average Star Ratings: The average Star Rating for Medicare Advantage plans fell in 2025 due to stricter scoring criteria, making it more important for beneficiaries to check individual plan ratings.
Enhanced Special Needs Plans (SNPs): The number of SNPs is increasing, and new policies will improve care coordination and allow for a monthly enrollment period for certain dual-eligible individuals.

Key Changes Affecting Your Coverage

For 2025, several regulatory updates and market shifts will impact your Medicare Advantage (MA) plan, from prescription drug benefits to new requirements for Special Needs Plans (SNPs).

Prescription Drug Updates

The Inflation Reduction Act (IRA) introduces significant changes to drug costs, impacting Medicare Advantage plans with prescription drug coverage (MA-PDs). Starting January 1, 2025, a new $2,000 annual out-of-pocket cap for covered Part D prescription drugs will be in effect, offering financial protection for those with high drug costs. This change also effectively eliminates the coverage gap or "donut hole". Additionally, a voluntary Medicare Prescription Payment Plan will allow enrollees to spread their out-of-pocket drug costs throughout the year.

Expanded Access to Behavioral Health

Access to behavioral healthcare services is set to improve in 2025. Medicare Advantage plans are required to have more robust provider networks, including marriage and family therapists and mental health counselors. A new intensive outpatient program will also be available to support those needing more significant mental health treatment.

Enhancements for Special Needs Plans (SNPs)

Special Needs Plans (SNPs) will also see modifications. New rules aim to improve care coordination for dual-eligible special needs plan (D-SNP) enrollees. A new Special Enrollment Period will allow qualifying dual-eligible individuals to change plans monthly, and the number of SNP offerings is increasing.

Understanding Premiums and Benefits

Average monthly premiums for MA plans are projected to slightly decrease in 2025, although premiums vary by plan and location. The percentage of plans offering a reduction in the Medicare Part B premium has significantly increased. While vision, dental, and hearing benefits remain common, the availability of other supplemental benefits like allowances for over-the-counter items, meals, and transportation has seen a reduction in availability for 2025.

Comparison: 2024 vs. 2025 Medicare Advantage

Key changes between 2024 and 2025 include a lower Part D out-of-pocket maximum, elimination of the donut hole, expanded behavioral health access, more Part B giveback plans, declining availability of some supplemental benefits, and a decrease in average Star Ratings.


Feature	2024 Plan Year	2025 Plan Year	Key Implication
Part D Out-of-Pocket Max	~$3,300 (before catastrophic)	$2,000 (all costs count)	Major cost relief for high drug users.
Donut Hole	Existed for most drugs	Eliminated	No more coverage gaps for prescriptions.
Behavioral Health Access	Traditional provider network	Expanded network (incl. MFTs, MHCs)	Greater choice and access to mental health support.
Part B Giveback Plans	Offered by 19% of plans	Offered by 32% of plans	More opportunity for premium savings.
OTC/Meal/Transport Benefits	Widespread availability	Declining availability	Supplemental benefits may be less robust in some plans.
Average Star Ratings	4.07	3.92	Overall plan quality ratings declined, so careful review is key.

Implications of the 2025 Star Ratings

The average Medicare Advantage Star Rating has decreased for the third consecutive year in 2025, primarily due to stricter scoring requirements set by CMS. This impacts plans' quality bonus payments, but many plans still have high ratings. Checking individual plan star ratings during the Annual Enrollment Period is important to gauge plan quality.

How to Navigate the 2025 Plan Changes

The Annual Enrollment Period (AEP) from October 15 to December 7 is the time to make changes for 2025. To make an informed decision, assess your current needs, use the Medicare.gov Plan Finder to compare plans and estimate costs, check star ratings for quality, and verify that your doctors and prescriptions are covered. You can find more information from The Centers for Medicare & Medicaid Services (CMS).

Conclusion: Making the Right Choice for 2025

For 2025, Medicare Advantage plans bring significant changes, including the beneficial $2,000 drug cap. However, shifts in supplemental benefits and average star ratings mean careful review of options is essential during the Annual Enrollment Period to find a plan that best meets your needs.

Frequently Asked Questions

The most significant change is the new $2,000 annual out-of-pocket cap on covered Part D prescription drug costs, which will protect seniors with high drug expenses.

If you have high prescription drug costs, the new cap will limit the amount you have to pay out-of-pocket for covered Part D drugs to a maximum of $2,000 per year, ending the coverage gap phase.

No, the average monthly premium for Medicare Advantage plans is projected to slightly decrease in 2025. However, individual plan premiums vary, and some benefits have shifted.

The average Star Rating declined in 2025, not because plans got worse, but because scoring criteria became stricter. It is important to check the ratings of specific plans when you compare options.

No. The main enrollment period to make changes is the Annual Enrollment Period (October 15 to December 7). There is also a Medicare Advantage Open Enrollment Period from January 1 to March 31 for those already in an MA plan.

Yes. Medicare Advantage plans are required to expand their behavioral health networks to include more providers like licensed marriage and family therapists, and mental health counselors.

Most plans continue to offer these benefits, but you should check the specifics of each plan. The availability of other supplemental benefits, like over-the-counter allowances and transportation, has declined in many plans.

You should review your current plan's costs and benefits, compare it with new offerings on Medicare.gov, and verify that your doctors and prescriptions are covered to find the best fit for your needs.

References

Medical Disclaimer

This content is for informational purposes only and should not replace professional medical advice. Always consult a qualified healthcare provider regarding personal health decisions.