Medicare

In just the fifth year of the Medicare prescription drug program, 90 percent of all beneficiaries now have comprehensive prescription drug coverage. Through Medicare Part D, about 14 million seniors and disabled Americans, who previously were uninsured or lacked drug coverage, now have access to needed medicines.

Part D is designed to achieve cost savings through a competitive market of private prescription drug plans, all overseen by the Centers for Medicare and Medicaid Services (CMS). This approach has led to significant savings on medicines for Part D enrollees and a lower-than-expected overall cost for America’s taxpayers.

Specifically, beneficiaries enrolled in a Part D drug plan are saving, on average, $1,200 annually on their medicines, CMS reports. Low-income seniors are saving an average of $4,000 a year. What’s more, the program is costing $520 billion less than originally forecast, according to the latest available data from the Congressional Budget Office.

CMS has announced the estimated average monthly premium for Medicare Part D enrollees in 2011 will be $30 - just one dollar more than the average monthly premium paid in 2010.

Although Medicare Part D has been a clear success story for seniors and American taxpayers, the recent health care reform law has made the program even better.

For example, the Part D coverage gap, otherwise known as the “donut hole,” has been a burden for some seniors. As part of the new health reform law, starting in 2011 Part D enrollees who reach the coverage gap will receive a 50 percent discount on the total cost of their brand-name medicines. This discount will be paid by biopharmaceutical research companies and will be given to beneficiaries at the point of sale of the medicine.

The 50 percent discount on brand-name medicines will combine with additional gap coverage contained in the law, so that the gap will fully close by 2020, and beneficiaries will pay the same share of their drug costs in what is now the coverage gap as they do in the initial benefit.

These important improvements come on the heels of high satisfaction rates among Part D beneficiaries. A recent survey by Medicare Today reported that 84 percent of seniors enrolled in Medicare Part D are satisfied with the program – an increase of 6 percent since the benefit began. A separate survey by The Wall Street Journal Online/Harris Interactive reported that 87 percent of Part D enrollees are highly satisfied.

Medicare and You: 2009

2010 Medicare Trustees Report

Survey Finds Beneficiaries Satisfied with Part D Coverage

Medicare Part D: Continuing to Offer Improvements to Patients