Medicare Drug Benefit Premiums Set To Jump by 24% in 2009
The average monthly premium for stand-alone Medicare prescription drug coverage will increase by 24% to $37 next year, according to an analysis of the plans by Avalere Health, the Wall Street Journal reports. The average monthly premium was $30 in 2008.
Monthly premiums for the 10 most popular plans will increase by 31% next year, according to the analysis (Zhang/Fuhrmans, Wall Street Journal, 9/26). The 10 largest plans account for 61% of Medicare drug plan beneficiaries (Bloomberg/Arizona Daily Star, 9/16).
CMS spokesperson Jeff Nelligan said premium increases are the result of rising drug prices and higher-than-expected usage of drug benefits (LaMendola, South Florida Sun-Sentinel, 9/26).
Acting CMS Administrator Kerry Weems said the average monthly premiums for stand-alone drug plans in 2009 "are still lower than originally estimated, and this is a competitive market." He added that beneficiaries will have access to drug coverage for the same amount or less than they paid this year, although doing so would require comparing many different plans (Bloomberg/Arizona Daily Star, 9/16).
Weems said, "The engine behind [the drug benefit] is choice and competition." Beneficiaries can enroll in new plans between Nov. 15 and Dec. 31 (AP/Miami Herald, 9/25).
According to the Journal, Medicare beneficiaries "tend to select a plan and stay with it," but it is "unclear how the price increases will affect the market" (Wall Street Journal, 9/26).
Avalere Vice President Lindsey Spindle said, "For many years people said, 'I'm going to stay put,' because it can be a difficult, daunting experience to pick a drug plan," but "based on what we see, now would be a very good time to see that their plan meets their medical and financial needs" (Bloomberg/Arizona Daily Star, 9/16).Beneficiaries also can choose to enroll in comprehensive private Medicare Advantage plans that include drug coverage (AP/Miami Herald, 9/25). Medicare officials said 93% of beneficiaries will have access next year to an MA plan that requires no additional premium and no deductible for drug coverage (Reichard, CQ HealthBeat, 9/25). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.