Why are my prescription drug plan premiums going up?
By now you’ve probably read the news reports about Medicare Part D, and how successful the program has been. There has also been a lot of news about the fact that the average premium for Part D plans will go down this year.
While that’s true, keep in mind that this is an average —some plans may not see a premium increase, but some may. According to a report by Avalere Health published on September 9, 2011, most people on a Medicare Part D plan are likely to see a premium INCREASE in 2012, if they accept the same plan that they had in 2011.
Every year, Avalere Health publishes some informative reports that analyze what’s happening to Medicare Part D and Medicare Advantage plans in the coming year. Last week they published the analysis we’re referring to, which digs into the 2012 Medicare Part D plans. Here’s the full report.
If you don’t want to read the whole thing, we drafted a brief summary.
Overall the report found:
- When you take every Medicare prescription drug plan available and average out their monthly premiums, premiums go down in 2012
- But, most people on a Medicare Part D plan may actually see their premiums increase in 2012 because nearly half of all people (45%) enrolled in a Medicare Part D plan are enrolled in one of only three Part D plans
- And, among those top three plans, the top two plans will have premium increases of 14% and 4% respectively
- The third place plan – by enrollment – will have a 9% premium decrease
Among the top 10 Part D prescription drug plans (by enrollment):
- 6 out of 10 plans will have premium increases
- The largest plan, which has 27% of all enrollees, will have the largest increase (14%)
Low income subsidies:
- 864,000 people on Medicare Part D receive a low-income subsidy and will have to be assigned to a new plan, because of these premium increases
- Among those 864,000 people losing their existing plan due to rate increases, 535,000 of them are on the nation’s most popular plan, which is experiencing a 14% rate increase
What do all of these changes and rate increases mean? To us, they’re a sign that you shouldn’t breeze through Medicare’s open enrollment period this year.
If you need help, you can contact PlanPrescriber.com.
You can also contact Medicare directly at 1-800-MEDICARE (1800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/ 7 days a week; the Social Security Office at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY users should call, 1-800-325-0778; or Your Medicaid Office (only required for pieces referencing Part D benefits or cost-sharing).
Medicare has neither reviewed nor endorsed this information.