Thursday, August 9, 2012

Medicare prescription drug premiums to remain steady for third straight year

Average basic premiums for Medicare prescription drug plans are projected to remain constant in 2013, Health and Human Services Secretary (HHS) Kathleen Sebelius announced today.  The average 2013 monthly premium for basic prescription drug coverage is expected to be $30. Average premiums for 2012 were projected to be $30 and ultimately averaged $29.67.  At the same time, since the law was enacted, seniors and people with disabilities have saved $3.9 billion on prescription drugs as the Affordable Care Act began closing the “donut hole” coverage gap.

“Premiums are holding steady and, thanks to the health care law, millions of people with Medicare are saving an average of over $600 each year on their prescription drugs,” said Secretary Sebelius. 

Today’s projection for the average premium for 2013 is based on bids submitted by drug and health plans for basic coverage during the 2013 benefit year, and calculated by the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary. 

The upcoming annual enrollment period -- which begins Oct. 15 and ends Dec. 7, 2012 – allows people with Medicare, their families and their caregivers to choose their plans for next year by comparing their current coverage and quality ratings to other plan offerings. New benefit choices are effective Jan. 1, 2013.

Because of the Affordable Care Act, out-of-pocket savings on medications for people with Medicare continue to grow.  Last month, CMS announced that more than 5.2 million people with Medicare have saved over $3.9 billion on prescription drugs in the Medicare Part D donut hole since the law was enacted.  In the first half of 2012, over 1 million people with Medicare saved a total of $687 million on prescription drugs, averaging $629 per person this
As a result of the Affordable Care Act, coverage for both brand name and generic drugs in the coverage gap will continue to increase over time until 2020, when the coverage gap will be fully closed.  This year, people with Medicare received a 50 percent discount on covered brand name drugs and 14 percent coverage of generic drugs in the donut hole. In 2013, Medicare Part D’s coverage of brand name drugs will begin to increase, meaning that people with Medicare will receive  a total of 52.5 percent off the cost of  brand name drugs (a 50 percent discount and an additional 2.5 percent in coverage) and coverage for 21 percent of the cost of generic drugs in the donut hole.

For more information on how the Affordable Care Act closes the Medicare drug benefit donut hole, please visit:

1 comment:

Retirement Solutions said...

In many cases the premium and the copay for these plans add up to far more than if the patient would pay without this Prescription Drug Coverage.

If you insist on generics only and pay the $4 copay, which is the same with insurance, you will save the amount of the premium, which is at least $360 per year plus the deductible that is on almost all of the basic plans in that price range.

This program only helps those on lots of brand name medications. The penalties for not having a PDP plan are so minimal that if you ever sign up for a plan the extra cost is far less than the money you saved by not having a plan at all.

Not mentioned are the high copays for brand name drugs, an initial deductible of a few hundred dollars, and the overall cost of having a plan vs. not having a plan for most people.

It is very difficult to make an informed decision because those selling it are not allowed to compare plans and sell you what is the best plan for your individual situation. The govt has a website where you can compare plans ( ) but many seniors are not computer or internet savvy, and the salesmen and insurance companies cannot tell you what is best for you. A very costly and for most a very useless program that costs the government a huge amount of money.

Beware and be aware.