Medicare Beneficiaries Could Face Higher Costs for Rx Drug Coverage
Several Medicare prescription drug plans in California no longer will be free of premiums for members, forcing more than 600,000 low-income Medicare beneficiaries to either choose a new plan before the end of the year or be reassigned, the Los Angeles Times reports.
The two largest Medicare Part D programs in California -- United AARP MedicareRx Plan Saver and Humana PDP Standard -- and five other programs will no longer qualify under Medicare as plans that receive full subsidies for premiums. Monthly charges for the plans are expected to increase significantly next year.
Kevin Prindiville, staff attorney at the National Senior Citizens Law Center's Oakland office, said of the 600,000 beneficiaries affected in California, about 500,000 initially were assigned to a plan and will be reassigned to a new plan.
The remaining 100,000 enrollees who chose their own program must either pay the new monthly premium or enroll in a new plan that covers the costs.
However, because all plans do not cover the same medications, the new plans might not include prescriptions that beneficiaries currently take.
The enrollment period for next year begins Thursday and lasts until the end of the year (Macias, Los Angeles Times, 11/10).
The open enrollment period for the Medicare Part D prescription drug benefit begins Thursday and continues through the end of the year, and beneficiaries should "look closely" at their plans because many of them are increasing premiums, copayments and deductibles, the Baltimore Sun reports. According to consulting firm Avalere Health, monthly premiums for 2008 on average are increasing 21% (Salganik, Baltimore Sun, 11/11).
The Kaiser Family Foundation on Wednesday released data showing that monthly premiums will increase 17% if enrollees do not switch plans. The Kaiser Family Foundation cites about a 5% increase in 2007, based on actual enrollment (Los Angeles Times, 11/10).
A number of plans will "raise their premiums significantly in 2008," according to the Winston-Salem Journal (Jackson, Winston-Salem Journal, 11/12).
According to the Kaiser Family Foundation, Humana's PDP Standard plan has increased premiums almost threefold since its debut in 2006. That plan has some of the "heaviest enrollment," according to USA Today (Appleby, USA Today, 11/12).
Although some plans are reducing their premiums, beneficiaries should note that the best choice might not be the "one with the lowest premium," but rather the "one that will mean the lowest total cost, over the year" for medications, according to the Sun.
Beneficiaries should consider the so-called "doughnut hole" coverage gap, under which beneficiaries are required to pay for drugs after $2,510 in costs have accrued for the year. The gap ends once total drug costs hit $5,726.35. Some plans cover generic drugs during the doughnut hole (Baltimore Sun, 11/11).
According to USA Today, only one insurer, which serves beneficiaries in Florida, covers brand-name drugs during the gap (USA Today, 11/12). Once the gap ends, beneficiaries receive all future drugs for a copay of $5.60 or less, according to the Sun.
In addition to doughnut hole coverage, beneficiaries also should consider that plans have different copays, lists of covered drugs and pharmacy networks (Baltimore Sun, 11/11).
Beneficiaries will have plenty of choices, with most states having 50 or more plans, according to USA Today.
CMS officials said that beneficiaries will be able to keep premium costs low in 2008. Herb Kuhn of CMS said, "In every state, people will be able to find a plan that costs less than $20 a month" (USA Today, 11/12).
Avalere President Dan Mendelson said, "The reality of the Medicare experience is that beneficiaries have been very loyal thus far to their initial plan selections. If consumers stick to their choices again, they are likely to see a dramatic increase in their monthly premiums" (Winston-Salem Journal, 11/12).
Beneficiaries also have the choice of enrolling in more comprehensive health insurance plans that include prescription drug coverage through Medicare Advantage. However, not all MA plans have drug coverage.
An MA plan "might be a good deal," but beneficiaries should understand the terms before signing up, according to the Sun (Baltimore Sun, 11/11).
Critics of MA have said that federal subsidies to the plans should be reduced, a move that is under consideration in Congress (Fahy, Pittsburgh Post-Gazette, 11/12).
Meanwhile, the number of special needs plans, which target beneficiaries with chronic conditions such as diabetes or high cholesterol, is increasing next year, according to the Post-Gazette.
Abby Block, director of the center for beneficiary choices at CMS, said that the number of special needs plans will rise by 58% in 2008. Block said the reason for the increase in these plans might be because the formula used to pay insurers changed and now takes a patient's health status into account.
Block said that it is unclear if the special needs plans will offer improved benefits but that the effect is "something we're trying very hard to measure" (Pittsburgh Post-Gazette, 11/12).