Medicare Prescription Drug Plans Shift Costs, Offerings for 2008
With the Medicare Part D prescription drug benefit entering its third year and insurers making changes to their offerings, beneficiaries might "have more reasons than ever" during the six-week open enrollment period starting on Thursday "to revisit their prescription drug coverage and consider a change," the Wall Street Journal reports.
Last year, only a small number of beneficiaries switched plans, even though there was a "flurry of new offerings, especially in Medicare Advantage," the Journal reports. According to the Journal, some insurers are "testing the loyalty" of beneficiaries by raising premiums and increasing out-of-pocket costs.
In the top three plans in the U.S., the average premium is set to increase 27% in 2008, according to an analysis of data from the government and private insurers. According to analysis from the Kaiser Family Foundation, about one in five beneficiaries in stand-alone plans will see an increase of more than $10 per month if they do not switch plans for 2008.
Among those who have remained in the same plan since the beginning of the drug benefit in 2006, about one-fourth will see their premiums rise 50% or more above their original rates. Dan Mendelson, president of consulting firm Avalere Health, said, "If you went to the market to look for the least-expensive plan, you need to look again."
In addition, many plans are reducing coverage during the so-called "doughnut hole" coverage gap. According to the Kaiser Family Foundation, almost one-third of stand-alone drug plans and about half of MA plans had some coverage during the gap this year.
Most plans with gap coverage in 2007 included all generic drugs during the doughnut hole. In 2008, about half of plans with gap coverage will cover only certain generic drugs during the gap. CMS this week is offering new tools on its Plan Finder Web site, including report cards (Zhang, Wall Street Journal, 11/13).