Average Medicare Part D premiums have dropped for the third year in a row, according to CMS, and they are projected to decline again in 2020. Medicare Part D plans offer prescription drug coverage to Medicare beneficiaries.
Over the past three years, average basic premiums for Part D plans have declined 13.5%, from $34.70 in 2017 to an estimated $30 in 2020, according to CMS. Overall, that represents cost savings of $1.9 billion to beneficiaries and more than $6 billion to taxpayers in the form of lower Medicare premium subsidies. Over the same time period, enrollment in Medicare Part D plans rose 12.2%, underscoring that seniors are looking for ways to afford their prescriptions.
“Medicare Part D plans continue to be extremely popular, and the President is delivering improvements to Part D, offering plans more ways to provide low-cost options and delivering patients more transparency on drug prices,” HHS Secretary Alex Azar said in a statement.
According to CMS, the agency is helping seniors pay less for Part D plans by offering more options and plans that have better negotiating tools in the private market. In addition, the agency has boosted competition among plans, leading to lower costs, and transparency for beneficiaries of overall costs.
“Part D plans are having to prove their value to beneficiaries––the actions that CMS has taken to strengthen the Medicare prescription drug program are working to drive down costs for seniors,” CMS Administrator Seema Verma said in a statement.
So far, CMS has required plans to offer more tools that provide out-of-pocket cost information to beneficiaries; prohibited gag clauses that prevent pharmacists from telling beneficiaries information of other lower-cost options; provided more drug choice options and plans; reduced the maximum amount beneficiaries could pay in out-of-pocket costs for some biosimilars; sped up how quickly generics can be added to drug plan formularies; increased competition among Part D plans by requiring designations that meaningfully differ.
CMS also recently announced a new Part D model, the Part D Payment Modernization, that would incentivize plans to negotiate lower drug costs when patients hit the catastrophic phase of drug coverage.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."