Average Medicare Part D premiums are expected to decrease by 1.8% in 2024, falling to $55.50 per month, according to the Centers for Medicare and Medicaid Services (CMS). This decrease is attributed to improvements in the Part D program outlined in the Inflation Reduction Act (IRA), which allow Medicare beneficiaries to benefit from reduced costs.
The Medicare Part D program is designed to assist Medicare enrollees in paying for both brand-name and generic prescription drugs. Currently, over 51 million individuals are enrolled in Part D plans. The average total premium for Part D consists of the average basic premium, which covers the basic benefits provided by Part D plans, and the average supplemental premium. Some Part D plans offer additional benefits beyond the basic plan, such as coverage for non-Part D drugs, and charge a supplemental premium accordingly.
While the projected average total monthly premium for Part D plans in 2024 is expected to be lower than in 2023, it is still higher than the premiums in 2020, 2021, and 2022. In 2020, the average total premium was $43.29, followed by $46.69 in 2021 and $51.66 in 2022.
The CMS calculates the projected average total monthly Part D premium based on plan bids submitted to them. This information is released to help individuals understand premium trends before the Medicare Open Enrollment period, which begins on October 15th. During this period, beneficiaries can select their plan options for the upcoming benefit year.
CMS cites two main reasons for the expected decrease in average Part D premiums. Firstly, the Inflation Reduction Act limits premium increases for Part D enrollees. Specifically, the law caps the growth in the base beneficiary premium, which is used to calculate the plan-specific basic premium, at a maximum of 6% per year. This provision helps moderate the growth in the average basic premium, along with a lower average supplemental premium, resulting in a lower average total premium.
Additionally, the Inflation Reduction Act will introduce several changes in 2024. These changes include limiting annual out-of-pocket costs, reducing cost-sharing for covered insulin products, and removing cost-sharing for recommended adult vaccines. Furthermore, starting next year, Part D plans will be required to apply price concessions from pharmacies to lower the price paid by beneficiaries at the point of sale.
CMS states that these changes will enhance the basic Part D benefit for 2024, providing better coverage for all Part D beneficiaries while reducing premiums for supplemental Part D coverage. CMS plans to release the premium and cost-sharing information for Medicare Advantage and Part D plans in September.
Overall, the projected decrease in average Medicare Part D premiums for 2024 is a positive development for beneficiaries, reflecting efforts to improve the affordability and accessibility of prescription drugs.
Original Story at medcitynews.com – 2023-08-01 22:13:44
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