How Will This 2025 Change to Medicare Affect Retirees’ Healthcare Costs?

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One of the silver linings of the COVID-19 pandemic was that the Centers for Medicare and Medicaid Services (CMS) began to cover telehealth visits, making it easier for people with difficulty traveling in person to obtain medical services to get care.

However, without Congressional action, these expanded Medicare telehealth services expire Jan. 1, 2025, according to a CMS fact sheet. “These include geographic and location restrictions on where the services are provided, and limitations on the scope of practitioners who can provide Medicare telehealth services,” it said.

While there is some leeway for some people in rural areas or approved telehealth locations, it could pose a significant change for many retirees who rely upon telehealth services.

What does this change mean for retirees’ healthcare costs if Congress does nothing in 2025 and beyond?

Medicare’s recent adjustments to telehealth reimbursements could have a ripple effect on retirees’ healthcare costs, according to Michael Genovese, MD, a physician and attorney and the chief medical advisor at Ascendant New York. “While the changes may not directly increase their out-of-pocket expenses, they could introduce other financial burdens,” he said.

Transportation Costs 

If telehealth becomes less accessible, retirees may need to travel more frequently for in-person appointments. “This can be particularly challenging — and expensive — for those in rural areas or without easy access to transportation,” Genovese said.

Caregiver Expenses 

Many retirees rely on caregivers to assist with medical visits. If telehealth is reduced, the need for in-person care may increase, leading to higher costs for caregivers or aides, Genovese explained.

Accessibility Issues

Limiting telehealth options can pose significant challenges for retirees who depend on it for regular healthcare, Genovese said. “Telehealth has been a game-changer for retirees in rural or underserved areas. These individuals may face delayed care or difficulty accessing specialists without long travel times if reduced,” Genovese said.

Disruptions in Chronic Care Management 

Telehealth provides a convenient way for retirees managing chronic illnesses to maintain routine follow-ups, Genovese said. “Reduced access could disrupt the continuity of care, potentially worsening health outcomes.” Worsening health outcomes can also lead to increased costs of care.

Time and Convenience Hassles

Telehealth has saved retirees time and energy by eliminating travel and reducing waiting room delays, Genovese pointed out. Without it, retirees may face more logistical challenges, even if their direct healthcare costs don’t rise.

A Widening Digital Divide

Many retirees have only recently adapted to telehealth technologies, Genovese said. If policies reduce availability, those who depend on virtual visits might feel left behind, especially if they struggle with mobility, he said.

“These challenges underscore the importance of ensuring equitable access to care, regardless of Medicare’s reimbursement changes,” he said.

How Should Retirees Prepare For These Changes?

Genovese recommended retirees take the following proactive measures to navigate these changes:

• Review medicare coverage: Take a close look at your Medicare plan’s telehealth benefits, as some Medicare Advantage plans may still offer broader telehealth coverage. Switch if you need to.
• Budget for potential costs: Factor in additional expenses, such as transportation and caregiver fees, and plan accordingly to avoid surprises.
• Supplemental insurance: Explore supplemental insurance policies that can help cover costs not reimbursed by Medicare, including additional in-person visits or care support.
• Utilize community resources: Many local programs offer free or low-cost transportation for seniors to medical appointments. 
• Consider health savings accounts (HSAs): If you’re eligible, use funds from an HSA to cover unexpected healthcare expenses, such as travel costs or uncovered medical services.

Additionally, it’s more important than ever for retirees to focus on preventative health steps, which can reduce costs of care later on, such as:

• Do your annual wellness visits.
• Stay up on vaccinations and health screenings.
• Exercise regularly and eat well .
• Manage chronic conditions.
• Focus on mental health.

As changes take effect, retirees must stay informed about their options and advocate for policies prioritizing equitable access, Genovese urged.

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