Social Security COLA 2025: 5 Reasons Why Rising Medicare Premiums Could Wipe Out Your Raise Next Year

4.     Medicare Deductibles and Copays: Additional Costs to Consider

In addition to rising Medicare Part B premiums, retirees must also consider increasing Medicare Part D premiums, deductibles, and out-of-pocket costs. While the average monthly premium for Part D plans is around $55, this amount can vary depending on the specific plan and the retiree’s income level.

Medicare Part D also has a $2,000 out-of-pocket cap on prescription drug costs, which limits how much retirees pay for medications annually. However, this cap does not cover other rising costs, such as rising premiums and non-drug-related medical expenses. These increasing expenses can still offset the financial benefit provided by the Social Security COLA increase.