Many older Americans will see reduced benefits and coverage changes when they shop for health insurance this fall. This is assuming their plans are even still available in 2025.

Over a million people will likely need to find new coverage as leading insurance companies implement cost-cutting measures and withdraw from markets for Medicare Advantage plans, the private sector alternative to the government-run program primarily for individuals aged 65 and older.

Industry experts also anticipate price increases for Medicare prescription drug plans due to the implementation of required coverage improvements.

These insurance changes will be announced just weeks before the presidential election and as Democratic candidate Kamala Harris campaigns on promises to reduce health care costs. Some states have already begun early voting.

“The rising premiums could pose a challenge for Vice President Harris. Increased costs are a clear indication of higher expenses for consumers," said Massey Whorley, an analyst at Avalere, a health care consulting firm. "This could have a significant impact on public perception of the current administration's performance."

Insurance brokers indicate that the election's distraction adds an extra layer of complexity to the already difficult annual enrollment period beginning next month.

Medicare Advantage plans will cover over 35 million individuals next year, roughly half of all those enrolled in Medicare , according to federal data. Insurance agents anticipate that more people than usual will need to find new coverage for 2025, as their current insurer has either discontinued a plan or exited their market.

Humana, the health insurance provider, expects over half a million customers — approximately 10% of its total customer base — to be affected by its withdrawal of Medicare Advantage plans from various locations across the nation. While many customers can transition to other Humana plans, company executives project a loss of a few hundred thousand customers.

CVS Health’s Aetna anticipates a similar loss, and other major insurers have also announced their departure from several states.

Insurers attribute their decision to pull back to escalating costs and increased healthcare utilization , along with reimbursement cuts from the government.

When insurers leave Medicare Advantage markets, they tend to cease offering plans with lower quality ratings and plans with a higher proportion of Black enrollees, noted Dr. Amal Trivedi, a public health researcher at Brown University.

He highlighted the potential difficulties for individuals with multiple physicians or those facing cognitive challenges, such as dementia.

Even with numerous options available, choosing a new Medicare Advantage plan requires careful consideration of out-of-pocket expenses, physician network participation, and prescription drug coverage.

“People are hesitant to change health insurance because of the uncertainty surrounding the new options,” explained Tricia Neuman, a Medicare expert at KFF, a non-profit organization focused on healthcare research.

Plans that stay within the market may increase deductibles and reduce benefits like cards used for utility or food expenses.

These plans proved popular in recent years as inflation escalated, according to Danielle Roberts, co-founder of Boomer Benefits, an insurance agency based in Fort Worth, Texas.

“It’s truly challenging for someone living on a fixed income to make informed health plan decisions … when $900 on a flexible spending account for free groceries seems quite appealing,” she explained.

Prices could also increase for some standalone Part D prescription drug plans, which individuals combine with traditional Medicare coverage. KFF states that this group includes over 13 million people.

The Centers for Medicare and Medicaid Services announced on Friday that premiums for these plans will decrease by an average of 4% to $40 next year.

However, insurance brokers and agents are reporting that premiums can fluctuate significantly, and they still anticipate some price increases. They also expect a decrease in plan options and modifications to formularies, or lists of covered medications. Roberts shared that she has already observed premium increases of at least $30 from certain plans for the coming year.

Any price adjustment will impact a customer base known to switch plans for premium changes as small as $1, according to Fran Soistman, CEO of the online insurance marketplace eHealth.

These changes are occurring as a congressional-approved coverage reform takes effect. Notably, out-of-pocket drug costs will be capped at $2,000 for Medicare beneficiaries, an initiative championed by Democrats and President Joe Biden in 2022.

In the long term, these changes will result in a “significantly improved benefit,” Whorley stated.

KFF's Neuman pointed out that the limit on drug costs will be especially beneficial for cancer patients and others with expensive prescriptions. She estimates that approximately 1.5 million individuals will benefit.

To prevent substantial premium increases due to the changes, the Biden administration will allocate billions of dollars from the Medicare trust fund to compensate insurers and keep premium prices in check, a move that has been criticized by some Republicans. Insurers will be restricted from raising premium prices by more than $35 next year.

Individuals will be able to enroll for 2025 coverage between October 15 and December 7. Experts emphasize that all the potential changes make it crucial for consumers to carefully examine any new options or coverage they plan to renew.

“This is not a year to be complacent, simply re-enrolling in the same old situation,” said Whorley, the health care analyst.

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