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Medicare Part D Beneficiaries Who Reach the Catastrophic Coverage
Limit Can Expect to Pay More Out-of-Pocket for Their Prescription Drugs Next
Year
Medicare
Part D enrollees with relatively high out-of-pocket expenses can expect see
their costs rise in 2020, according to a new KFF analysis. This is mainly due to an increase
in how much enrollees will pay out of pocket for their prescription drugs in
the Part D benefit coverage gap phase before they qualify for catastrophic
coverage.
The
analysis finds that out-of-pocket drug costs will increase by nearly $400 --
from $2,275 in 2019 to $2,652 in 2020 -- for Part D enrollees who take only
brand-name drugs and have annual total drug costs that reach the catastrophic
coverage threshold.
Between
2019 and 2020, this catastrophic threshold will increase by $1,250, or nearly
25 percent, rising from $5,100 in 2019 to $6,350 in 2020.
For
enrollees who take only brand-name drugs, about a quarter of this increase
will be paid out-of-pocket, with the remainder covered by drug manufacturers
in the form of a price discount for brands in the coverage gap phase. Those
who take only generics will pay the entire increase out-of-pocket. The
relatively large increase in 2020 is due to the expiration of the Affordable
Care Act (ACA) provision that slowed the growth rate in the catastrophic
threshold between 2014 and 2019.
In
2017, the most recent year for which claims data is available, 4.9 million
enrollees who were not eligible for low-income subsidies reached the Part D
coverage gap, including 1 million who reached the catastrophic threshold. Had
the threshold been higher in 2017, fewer than 1 million enrollees would have
qualified for catastrophic coverage that year, meaning a larger number of
enrollees would have remained in the coverage gap in 2017, where they pay a
larger share of their total costs than in the catastrophic phase.
The
analysis of higher out-of-pocket costs that Part D enrollees will face in
2020 comes at a time when lawmakers in Congress are considering proposals to
address concerns about prescription drug costs. Proposals from the
Senate Finance Committee, Speaker Pelosi, and the Trump Administration each
include changes to the standard Medicare Part D benefit, including a hard cap
on out-of-pocket costs for Part D enrollees and a reallocation of liability
above the catastrophic threshold.
Filling the need for trusted
information on national health issues, the Kaiser Family Foundation is a nonprofit
organization based in San Francisco, California.
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Monday, October 14, 2019
Medicare Part D Beneficiaries Who Reach the Catastrophic Coverage Limit Can Expect to Pay More Out-of-Pocket for Their Prescription Drugs Next Year
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