Medicare Advantage and Part D, 2016

In recent years, both the Medicare Advantage (MA) and Part D prescription drug programs have continued to grow, quality of participating plans has continued to increase, and premiums have remained stable. Earlier this year, the Centers for Medicare and Medicaid Services (CMA) announced that:

•   Enrollment in MA and Part D has increased by 42 percent since passage of the Affordable Care Act in 2010. Nearly 30 percent of Medicare beneficiaries now enroll in an MA plan.

•   Plan quality continues to improve. In 2015, 60 percent of MA enrollees will be enrolled in a 4- or 5-star plan, compared to an estimated 17 percent back in 2009.

•   Average premiums dropped 6 percent between 2010 and 2015.

Every year, the value of the benefit in Part D plans increases along with any increase in drug expenses. This means the defined standard Part D benefit will continue to cover a constant share of drug expenses from year to year. For 2016, CMA has set the parameters for the standard Part D plan: 

•   Deductible: $360

•   Initial coverage limit: $3,310

•   Out-of-pocket threshold: $4,850

•   Minimum cost-sharing in the catastrophic coverage portion of the benefit: $2.95 per generic or multi-source drug, and $7.40 for all other drugs 

•   Total covered Part D spending at out-of-pocket threshold for beneficiaries not eligible for discount program: $7,062.50. Beneficiaries eligible for the gap discount program will have an estimated total covered spending of $7,515.22.

For information on Medicare Advantage and/or Part D prescription drug programs, please contact us.