Medicare Prescription Drug Premiums to Rise in '09 (HealthDay)

THURSDAY, Aug. 14 (HealthDay News) -- The average monthly premiumfor Medicare's prescription drug plan will increase to an estimated $28 in2009, three dollars more than this year's monthly premium, Medicareofficials announced Thursday.

That 2009 figure is 37 percent lower than originally projected whenMedicare's so-called Part D drug coverage was introduced in 2003, theofficials added. The Part D program offers prescription drug benefits toMedicare beneficiaries.

"Part D continues to come in under budget, achieve consistently highsatisfaction rates, and with it millions of Americans are livinghealthier, better lives," Kerry Weems, acting administrator of the U.S.Centers for Medicare and Medicaid Services, said during an afternoonteleconference.

But, he added, "most beneficiaries will see a premium increase in theircurrent plan. There will be some significant increases."

There are three reasons behind the premium increase, Weems said.

"First, there is a trend in prescription drug cost growth generally -- prices tend to increase because of price increases for existing drugs, thegrowth in the average number of prescriptions per person, and theintroduction of new drugs," he said.

Second, the 2008 premiums were calculated as part of a demonstrationproject that has now expired. This project resulted in premiums being 50cents less in 2008 than had been projected.

"That change is now reflected in the 2009 premium," Weems said.

Third, drug distributors participating in Part D have found coveragefor catastrophic care to be higher than expected. "So they have adjustedtheir 2009 bids to reflect those higher-than-anticipated costs," Weemssaid.

There are steps Medicare beneficiaries can take to reduce the impact ofpremium increases, Weems added.

In 2009, Medicare beneficiaries will continue to have access to what'sknown as enhanced drug coverage, which allows people to pay additionalpremiums to cover gaps in their drug coverage. Some low-incomebeneficiaries will be able to have their gap coverage at minimal or nocost, Weems said.

"In addition, 97 percent of people in stand-alone prescription drugplans will have access to a 2009 plan with equal or lower-cost premiumsthan their 2008 plan," Weems said. "Moreover, many Medicare beneficiarieswill have access to a Medicare Advantage plan that offers lowerprescription drug premiums than a stand-alone plan."

Currently, 24.4 million Medicare beneficiaries are enrolled in the PartD drug plan.

In a related development, Medicare officials announced Thursday that 10doctors-group practices participating in Medicare's Physician GroupPractice Demonstration project showed improved quality of care forpatients with congestive heart failure, coronary artery disease anddiabetes.

Based on these improvements, the 10 groups involved in the project arebeing paid $16.7 million in incentives designed to reward health-careproviders for improving results and coordinating the health care needs ofMedicare patients.

"We are paying for better outcomes and we are getting higher qualityand more value for the Medicare dollar," Weems said in a preparedstatement. "And these results show that by working in collaboration withthe physician groups on new and innovative ways to reimburse for highquality care, we are on the right track to find a better way to payphysicians."

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