Thinner benefits and changes in coverage are on the horizon for many older Americans as they shop for health insurance this fall. Some may discover that their plan is no longer available in 2025. Over a million individuals are likely to need to seek new coverage as major insurers cut costs and withdraw from markets for Medicare Advantage plans, which are privately operated versions of the government’s coverage program primarily for individuals aged 65 and above. Experts in the industry also anticipate some price increases for Medicare prescription drug plans due to mandated coverage enhancements.
With the upcoming presidential election and Democrat Kamala Harris campaigning on healthcare cost reduction promises, voters will soon become aware of these insurance modifications. The election-related distractions pose an added complication to the already challenging annual enrollment period that commences next month. The situation is further complicated by insurers scaling back from offering Medicare Advantage plans.
According to the federal government, Medicare Advantage plans will encompass over 35 million individuals next year, roughly half of all Medicare enrollees. Insurance agents foresee an increased number of individuals needing new coverage for 2025 because their insurer has either terminated a plan or exited their market. For instance, Humana estimates that more than half a million customers – approximately 10% of its total clientele – will be impacted as they withdraw Medicare Advantage plans from various regions. Similarly, CVS Health’s Aetna anticipates a comparable loss, and other major insurers have announced their departure from several states.
Insurers attribute their retreat to escalating costs, increased care utilization, and reimbursement reductions from the government. Dr. Amal Trivedi, a researcher at Brown University, pointed out that when insurers depart Medicare Advantage markets, they usually cease offering plans with lower quality ratings and those that cater to a higher proportion of Black beneficiaries. Market exits can particularly affect individuals with multiple doctors and patients with cognitive issues like dementia.
While most markets will still offer numerous plan options, navigating through the out-of-pocket costs, coverage of physicians, and regular prescriptions to find a new suitable option can be challenging. Some plans that remain in markets may raise deductibles and reduce benefits like utility or food payment cards, popular in recent years as a response to rising inflation.
Furthermore, standalone Part D prescription drug plans, which are paired with traditional Medicare coverage, might also experience price hikes, as noted by the Centers for Medicare and Medicaid Services. It’s essential for individuals to remain vigilant and investigate their choices or renewing coverage closely due to all these potential changes in the health insurance landscape.
