Written by Ahmed Aburin
WASHINGTON (Reuters) – Average premiums and benefits for Medicare's prescription drug program and private Medicare plans are expected to remain stable in 2025, although premiums will decline slightly, the Centers for Medicare and Medicaid Services said on Friday. announced.
Why is it important?
Premiums are of interest to consumers who enroll in Medicare Advantage plans run by private insurance companies and are paid by the government and the health plans themselves, which set premiums and benefits based on reimbursement rates.
The government is trying to bring down the price of MA to the level of original Medicare, the government's health insurance for people aged 65 and over.
Private health insurers had argued that lowering premiums would limit the benefits they offer, but government forecasts on Friday showed premiums remained stable. In April, when the premium rates were announced, health insurance company stock prices had fallen between 6% and 12%.
context
Medicare is the U.S. government's health insurance program for people age 65 and older and people with disabilities.
Medicare Advantage plans are offered by private insurance companies that are paid a set fee by the government to manage the medical care of Medicare beneficiaries who want additional benefits not provided by regular Medicare insurance.
Medicare also includes an optional prescription drug coverage program known as Part D.
In April, the Centers for Medicare and Medicaid Services, which administers Medicare, announced the final 2025 tax rate for MA payments, which included a 0.2% reduction.
The reduction is part of a three-year plan to reduce payments to MA plans in an effort to bring them more in line with original Medicare.
Look at the numbers
Enrollment in Medicare Advantage plans will increase from 50% in 2024 to 35.7 million in 2025, or 51% of all Medicare beneficiaries.
The average monthly premium for MA is projected to decline by $1.23, from $18.23 in 2024 to $17 in 2025.
By 2025, almost 60% of beneficiaries will have $0 premiums, and 83% will have the same or lower premiums if they keep their current plans, and 20% of them will have lower premiums.
The average Part D premium is expected to drop $7.45 to $46.50 in 2025 from $53.95 in 2024.
(Reporting by Ahmed Aboulenein; Editing by Bill Berkrot)
