CMS announces lower Medicare Part D premium for 2024
CMS also releases the 2024 Part D national average monthly bid amount to help Plan D sponsors finalize their premiums.
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The projected average total Part D beneficiary premium is projected to decrease by 1.8% in 2024, from $56.49 in 2023 to $55.50 in 2024, according to an announcement Monday from the Centers for Medicare and Medicaid Services.
The average total monthly premium for Medicare Part D coverage in 2024 of $55.50 represents the sum of the average basic premium and the average supplemental premium for plans with enhanced coverage. It is the most accurate current projection of what people will pay in 2024 for Part D premiums, CMS said.
CMS has also announced that the Part D national average monthly bid amount for 2024 is $64.28, the 2024 Part D base beneficiary premium is $34.70 and the de minimis amount for low income beneficiaries is $2.
CMS is releasing the Part D national average monthly bid amount to help Part D plan sponsors finalize their premiums and prepare for Medicare Open Enrollment from October 15 to December 7, for coverage beginning January 1, 2024.
CMS said it anticipates releasing the 2024 premium and cost-sharing information for 2024 Medicare Advantage and Part D plans in September.
WHY THIS MATTERS
CMS on Monday released the 2024 Part D national average monthly bid amount, the Medicare Part D base beneficiary premium, the Part D regional low-income premium subsidy amounts, the Medicare Advantage regional Preferred Provider Organization benchmarks and the MA employer group waiver plan regional payment rates.
A Part D pharmacy price concessions policy will also be implemented in 2024.
This change is expected to lower beneficiary out-of-pocket prescription drug costs and improve price transparency and market competition in the Part D program, CMS said.
In recent years, more Part D plans have been entering into arrangements with pharmacies where the Part D plans may pay less money for dispensed drugs if pharmacies do not meet certain criteria. The negotiated price for a drug is the price reported to CMS at the point of sale, which is used to calculate beneficiary cost-sharing and generally adjudicate the Part D benefit.
With the emergence of these payment arrangements, the negotiated price is frequently higher than the final payment to pharmacies. Higher negotiated prices lead to higher beneficiary cost-sharing, CMS said.
In 2022, CMS finalized a policy that requires Part D plans to apply all price concessions they receive from network pharmacies to the negotiated price at the point of sale so that the beneficiary can also share in the savings at the pharmacy. This change is projected to decrease Part D beneficiary out-of-pocket costs by $2.62 billion in 2024.
Plans will have until Monday, August 7, to complete rebate reallocation. Plans will have from Monday, August 7, 2023, to Monday, August 14, to inform CMS of their intent to participate in the voluntary de minimis program.
THE LARGER TREND
Stable premiums for Medicare prescription drug coverage in 2024 are supported by improvements to the Part D program in the Inflation Reduction Act that allow people with Medicare to benefit from reduced costs, CMS said.
The Medicare Part D program helps people with Medicare pay for both brand-name and generic prescription drugs. Part D remains one of Medicare's most popular programs, with more than 51 million Medicare beneficiaries enrolled for prescription drug coverage.
Twitter: @SusanJMorse
Email the writer: SMorse@himss.org
