For 2025, the standard Medicare Part B premium increased to $185 per month, up from $174.70 in 2024, with a corresponding Part B deductible of $257. Part A is usually free for most seniors, but those who buy it pay either $285 or $518 monthly. Part D prescription drug plan premiums vary, with an average projected around $40/month, and higher earners pay Income-Related Monthly Adjustment Amounts (IRMAA) for both Parts B and D.
The standard monthly premium for Medicare Part B enrollees will be $185.00 for 2025, an increase of $10.30 from $174.70 in 2024. The annual deductible for all Medicare Part B beneficiaries will be $257 in 2025, an increase of $17 from the annual deductible of $240 in 2024.
Yes, senior citizens will pay more for Medicare in 2026, primarily due to a nearly 10% jump in the standard Part B premium to $202.90/month and higher deductibles, affecting most enrollees and consuming a significant portion of the Social Security cost-of-living adjustment (COLA). While Medicare Advantage (Part C) premiums are decreasing on average, out-of-pocket costs and some supplemental benefits are rising, and Part D drug plan maximums are increasing, leading to higher overall expenses for many.
Starting in 2025, there is an annual limit on what you pay out-of-pocket for prescription medications through Medicare and Medicare Advantage prescription drug plans. All prescription medications, including specialty medications, covered by Part D plans are included under this cap.
Yes, the Medicare Part D "donut hole" (coverage gap) is officially eliminated as of January 1, 2025, thanks to the Inflation Reduction Act, simplifying coverage into three phases: deductible, initial coverage, and catastrophic, with a new $2,000 out-of-pocket spending cap that eliminates the gap where higher costs used to occur.
Your CalPERS health coverage will automatically be canceled the first day of the month after you turn 65. Review Cancellation of CalPERS Health Coverage for information on reinstating your health coverage.
Here are some of the biggest Medicare mistakes to avoid:
It's capped at $2,000, a threshold that will rise each year to cover inflation. Lawmakers in Congress set those changes in the Inflation Reduction Act under President Joe Biden. The law also shifted a larger share of the cost of drugs used by Medicare beneficiaries from the federal program to insurers.
Eliquis (generic name: Apixaban) alone racked up $18.3 billion in Medicare spending in 2023, nearly double the next drug, Ozempic. Alongside Xarelto, anticoagulants accounted for over $24 billion in 2023.
Yes, Medicare costs are increasing in 2025 and even more significantly for 2026, with higher monthly premiums for Part B and higher deductibles for both Part A (hospital) and Part B, while Part D (prescription drugs) introduces a major $2,000 out-of-pocket spending cap in 2025, even as its deductible rises. These increases reflect rising healthcare costs, with Part B's standard premium jumping to $202.90 in 2026, eating into the Social Security COLA for many seniors, according to Centers for Medicare & Medicaid Services and USA Today.
Each fall, when we ask the IRS for information to determine next year's premiums, we ask for tax information to verify your reports of changes affecting your income-related monthly adjustment amounts, if any. We also ask the IRS for your two-year-old MAGI if we've temporarily used three-year-old MAGI.
For 2025 Medicare premiums, the income used is your Modified Adjusted Gross Income (MAGI) from your 2023 tax return, two years prior, with higher incomes leading to increased Income-Related Monthly Adjustment Amounts (IRMAA) for Parts B and D. MAGI includes your AGI plus tax-exempt interest and other non-taxable income, determining if you pay higher costs based on specific income brackets set by Medicare.
Medicare does not cover:
Medicare Plan G is generally better for most people as it offers nearly identical comprehensive coverage to Plan F but with lower premiums, though Plan F is technically more comprehensive by covering the Part B deductible, but it's only available to those eligible for Medicare before January 1, 2020; for those who can get both, Plan G usually offers better overall value by saving money on premiums, making the small Part B deductible (around $283 in 2026) a worthwhile trade-off.
The extra $144 added to Social Security usually comes from the Medicare Part B Giveback benefit, offered by some Medicare Advantage (Part C) plans, which pays back some or all your Part B premium, showing up as extra money in your check if it's deducted from your Social Security. To qualify, you need Original Medicare (Parts A & B), pay your own Part B premium, live in a plan's service area, and enroll in a specific Medicare Advantage plan that offers this "rebate," with the amount varying by plan and location.
The $2,000 prescription cap for seniors is a real benefit from the Inflation Reduction Act (IRA) that began in 2025, setting a limit on out-of-pocket prescription drug costs for Medicare Part D enrollees, meaning beneficiaries pay no more than $2,000 annually for covered medications, with the cap increasing to $2,100 in 2026. This major change eliminates the "donut hole" and provides significant savings for seniors with high drug costs, allowing costs to be spread out monthly.
The "best" secondary insurance for Medicare depends on your needs, but Medigap Plan G and Plan N are top choices for most new enrollees, offering comprehensive coverage for costs Original Medicare doesn't cover, with Plan G covering nearly everything (except the Part B deductible) and Plan N being more affordable with small copays. Top providers known for Medigap include UnitedHealthcare (AARP), Aetna, Humana, and Mutual of Omaha, offering nationwide networks and strong customer satisfaction.
You might not want a Medicare Advantage (MA) plan if you value provider choice, consistent coverage, and predictable costs, as MA plans often have restricted networks, require prior authorizations, change benefits annually, and can have high out-of-pocket costs for expensive treatments, potentially leading to care delays or disruptions, especially for serious illnesses like cancer.