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In 2027 my and Connie’s Part D premiums will increase from $72.30 to $130.00 per month and our individual deductible will increase from $615 to $700 per year (the maximum allowed). Those new premiums do not include IRMMA extra premiums.
That’s quite a jump in out-of- pocket costs, I’ll cope, but given these premiums have nothing to do with income, such increases will be a true burden for many retirees. More consequences in retirement virtually unable to plan for.
The Inflation Reduction Act significantly increased Part D premiums by shifting more costs to insurance companies. To ease that and help avoid immediate premium increases there were premium subsides.
For 2027 officials determined “the prior subsidies as unnecessary handouts to insurers.” Of course, they are not any such handouts. They help seniors pay premiums. The same claim was made- “slashing handouts”-when reducing payments to Medicare Advantage plans). I wonder if decision makers understand the concept of insurance? No matter…
I could go into the political ideology of this, but my HD lips are sealed. But think of the logic.
Insurance has a real cost, let’s say $100. Party A pays $40 and Person B pays $60. Party A decides it no longer wants to pay $40 determining it is a “handout” so drops to $20. The real cost still exists, insurance companies must cover costs, so Person B now pays $80. In this case there are about 65 million Persons B.
It’s definitely worth shopping on the Medicare.gov website making sure to input your specific prescriptions. My mother’s projected “all-in” cost for 2027 w her current plan was going to be around $1500 (premium plus co-pays). Her “all-in” under what we anticipate will be her new plan for 2027 is just under $64! I’d say that was worth the effort on the website which was prob less than 10 minutes for a savings of over $1400 and 90%+. 🙂
That’s very interesting. As someone who designed employer health plans, I know there is a reason for that, one that may not be readily apparent. How does the low cost insurer do it?
It could be a limited network of pharmacies, it could be circumstances of the prescriptions being taken. It could be the plans past experience, they could be using a loss leader.
The problem with the system is that just one new Rx for the patient could change the entire picture.
The structure of Part D plans is an abomination.
Seniors should not have to deal with so many variables. All plans should have the same formularies covering every drug with FDA approval and also have open pharmacy networks.
The only legitimate variable should be selecting the deductible and co-pays you are willing to fund.
As I have said before and based on years of experience, when it comes to health benefit plans, choice, especially multiple choices is not a good idea, it is overwhelming for many, perhaps most people and it is unfair because it leads to adverse selection and cost shifting.
One of my major beefs with part D insurers is that they are not required by law to continue to cover all medications that are listed in their formulary at the time of open enrollment through the end of the contract year.
You’re absolutely right. The law was probably written by the insurers. As I said, all FDA approved drugs should be on every formulary. I have many years explaining health benefits to people but trying to cover all the variables individuals face with Part D is ridiculous. The fact people can be at risk for a Rx they weren’t taking at the start of the year is just wrong. The entire structure of competition is working against people.