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Medicare Part D Beneficiaries Consider Options As Coverage Will Cost More

Armen Hareyan's picture

Medicare Part D Beneficiaries

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With the Medicare Part D prescription drug benefit entering its thirdyear and insurers making changes to their offerings, beneficiariesmight "have more reasons than ever" during the six-week open enrollmentperiod starting on Thursday "to revisit their prescription drugcoverage and consider a change," the Wall Street Journalreports. Last year, only a small number of beneficiaries switchedplans, even though there was a "flurry of new offerings, especially inMedicare 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.

Inthe top three plans in the U.S., the average premium is set to increase27% in 2008, according to an analysis of data from the government andprivate insurers. According to analysis from the Kaiser Family Foundation,about one in five beneficiaries in stand-alone plans will see anincrease of more than $10 per month if they do not switch plans for2008. Among those who have remained in the same plan since thebeginning of the drug benefit in 2006, about one-fourth will see theirpremiums 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."

Inaddition, many plans are reducing coverage during the so-called"doughnut hole" coverage gap. According to the Kaiser FamilyFoundation, almost one-third of stand-alone drug plans and about halfof MA plans had some coverage during the gap this year. Most plans withgap coverage in 2007 included all generic drugs during the doughnuthole. In 2008, about half of plans with gap coverage will cover onlycertain 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).

Reprinted with permission from kaisernetwork.org. Youcan view the entire Kaiser DailyHealth Policy Report, search the archives, and sign up for email deliveryat kaisernetwork.org/email. The Kaiser Daily HealthPolicy Report is published for kaisernetwork.org, a free service of The HenryJ. Kaiser Family Foundation.