The Kaiser Family Foundation has issued new analyses of Medicare Part D program data that show average weighted premiums rose from 2007 to 2008, cost-sharing has increased. And almost all subscribers continue to be in plans with a “doughnut hole” – the coverage gap for enrollees.
The reports, available for download at www.kff.org, show more than 25 million Medicare beneficiaries are now enrolled in Part D plans, which provide prescription drug coverage.
Of those, 17.4 million are in stand-alone plans, and 8 million are in Medicare Advantage – managed care – plans that include drug coverage.
There are 1,824 stand-alone Part D plans nationwide, the Kaiser reports show, down from 1,875 in 2007 – which in turn was up sharply from 1,429 in 2006, the program’s first year. The number of choices available to each beneficiary varies, from a low of 47 in Alaska to a high of 63 in Pennsylvania and West Virginia.
In Rhode Island and Massachusetts, figures provided directly by the U.S. Centers for Medicare and Medicaid Services show, 51 stand-alone plans are available, plus 13 Medicare health plans that include drug coverage.
Monthly premiums vary widely, the Kaiser reports show, and those that offer coverage during the gap are typically twice as expensive. And premiums have been rising: The average premium for stand-alone Part D coverage, weighted by enrollment, rose from $25.93 per month in 2006 to $27.39 in 2007.
If all enrollees had stayed with their existing plans in 2008 – and Medicare figures show that most prefer to do so – they would have seen premiums rise 17 percent, to $31.99, with nearly one in five enrollees experiencing a monthly increase of at least $10.05, Kaiser reported.
Comparable Rhode Island figures are not available, but materials provided by Medicare stress that 99.4 percent of local Part D enrollees could switch plans in 2008 and pay lower premiums than they paid in 2007.
Overall, however, premiums are rising here as well: This year’s stand-alone plan premiums in Rhode Island start at $14.60, up from $13.40 last year and $7.32 in 2006.
The cheapest Rhode Island plan with generic-drug coverage in the coverage gap costs $41.70 per month, whereas last year, four plans actually offered gap coverage not just generics, but preferred-brand drugs, for less than $40 per month.
The Kaiser analysis shows in 2008, a majority of Part D plans have that gap in drug coverage, which this year begins after $2,510 in costs incurred.
The plans that do offer gap coverage are also limiting it more, Kaiser reported, with “wide variation” this year especially in the scope of benefits offered in the gap, and about half the stand-alone plans not even covering all generics, but just “preferred” or “some” generics.
Looking specifically at the 47 stand-alone Part D plans available nationwide, Kaiser also reported that while formulary coverage of drugs has remained relatively stable since 2006, average cost-sharing amounts have increased for both brand-name and generic drugs, particularly for brand-name drugs that plans list as “non-preferred.”
The average cost-sharing for a 30-day supply of a “non-preferred” brand-name drug has risen by 29 percent since 2006, from $55.36 to $71.31, while average cost-sharing for “preferred” brand-name drugs increased by 11 percent, from $26.87 to $29.86.
On average, Medicare Part D enrollees paid more in 2007 for preferred and non-preferred brand-name drugs than people in employer-sponsored plans, Kaiser reported. And there are strong financial incentives to switch drugs, especially at the high end, with many plans now including specialty tiers for high-cost drugs with cost-sharing between 25 and 33 percent.
For individual seniors, a great deal of money can be at stake in those cost-sharing setups – and the differences between plans. A person with Alzheimer’s disease, for example, Kaiser reported, could pay $20 for a month’s supply of Aricept under one plan in 2008, but $107 per month under another.
All that has made Medicare Part D, even now in its third year, “both a blessing and a curse” for patients, said Dr. John B. Murphy, a practicing geriatrician, a professor at Brown University, chief medical officer at Rhode Island Hospital and president-elect of the American Geriatrics Society.
“I think the average older person in this country is spending less on prescription medications because of the plan, and that’s a positive,” Murphy said. But seniors have found it difficult to pick the right plan for their specific needs, he added, and while the Medicare Web site helps, many are not Web-savvy, and their family members can find the choice daunting as well.
The wide range of choices makes it that much tougher, Murphy said, and it’s not uncommon for a husband and wife to each have a different plan, handpicked to match the drugs they take. But often the formularies change over the course of the year, creating complications and unexpected costs. Doctors themselves, he said, can’t possibly keep up. The doughnut hole is also affecting seniors.
“I have many patients who get through most of the year, but then the last few months, they go into the doughnut hole, and they start skipping medications,” he said. Some start taking their pills every other day, or if they take two blood-pressure drugs, they may skip one.
That’s an inherent problem with Medicare Part D, Murphy said: It was designed to fit within Congress’ budget constraints, not necessarily to be easy for seniors.
“It’s very complicated and difficult for them,” he said. “And the older they are, the more difficult it is, and the more likely that they’re on many medications and [that] they have less money.” •
