Are Medicare Premiums Expected to Remain Stable in 2014?

The United States Dept. of Health and Human Services (HHS) has released data indicating Medicare Part D prescription drug plan premiums are projected to remain stable in 2014.

ico_rxWhile Part D premiums have averaged $30 per year during the period from 2011 through 2013, premiums are expected to increase only slightly to about $31 next year.

The HHS announcement coincides with news that out-of-pocket costs associated with Part D drug costs are on the decrease. According to HHS, over 6 million drug plan enrollees have saved a total of $7 billion—an average of $1,061 per enrollee—as a result of provisions of the Affordable Care Act (ACA) aimed at making prescription drugs more affordable to Medicare recipients.

The ACA aims to reduce out-of-pocket expenses by bringing relief to millions of Part D enrollees who fall into the “donut hole” coverage phase. According to the Centers for Medicare and Medicaid Services, “In 2012, more than 3.5 million seniors and people with disabilities who reached the Medicare Part D coverage gap received discounts on brand-name prescription drugs. These individuals with Medicare received more than $2.5 billion in discounts, or an average of $706 per beneficiary. Savings for covered generic drugs while in the ‘donut hole’ in 2012 totaled $105 million for 2.8 million beneficiaries.”

This accounts for the majority of money Medicare recipients are said to have saved as a result of the Affordable Care Act.

While the ACA calls for the donut hole to close by 2020, Kaiser Health News reports that Pres. Obama’s proposed fiscal 2014 budget may speed up the process by five years. According to Kaiser, “This acceleration would be financed by increasing the current 50 percent discount that the drug makers give to beneficiaries in the ‘doughnut hole’ to 75 percent starting in 2015. Beneficiaries would be responsible for the remaining 25 percent of drug costs.”

Get your free Medicare Supplement quote today.

Many drug companies strongly oppose having to shoulder a heavier burden, so it seems far from likely that the donut hole will close as early as 2015. But even so, the projected steadiness of Medicare Part D premiums in 2014 and prescription drug savings already enjoyed by most Part D enrollees strongly suggest Part D prescription drug plans will remain a highly affordable complement to Medicare supplement plans in ensuring the best possible coverage to offset the gaps in Original Medicare.

Although 2014 Medicare Part B premiums are not likely to be announced until mid-fall, recent history suggests that next year’s Part B premiums for the majority of Medicare recipients will not change substantially from the current $104.90 per month. About 99 percent of Medicare recipients, meanwhile, qualify for premium-free Medicare Part A coverage.

Has the Affordable Care Act had an impact on your prescription drug costs? Leave a comment below!

© 2013 MedicareMall.com

Leave a Reply

Your email address will not be published. Required fields are marked *