Over 80% of Seniors Face Higher 2010 Medicare Part D Prescription Drug Plan Premiums

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Based on the newly released 2010 stand-alone Medicare Part D prescription drug plan information, around 80% of seniors and other Medicare beneficiaries across the country can expect to see an increase in their current monthly Medicare Part D premiums unless they switch to a lower cost plan. A summary of the stand-alone 2010 Medicare prescription drug plan landscape now online at Q1Medicare.com also shows that seniors will have a slightly smaller selection of Medicare prescription drug plan in their state with more 2010 plans implementing an initial deductible and fewer 2010 Part D plans offering donut hole coverage. On the upside, Medicare beneficiaries qualifying for the full low-income subsidy will still find a number of 2010 Part D plans in each state offering the $0 monthly premium.

2010 Medicare Prescription Drug Plans

Seniors should prepare to closely review their 2010 Part D options and ensure that they are provided the most affordable prescription drug coverage.

Based on the 2010 Medicare Part D plan information recently released by the Centers for Medicare and Medicaid Services (CMS), over 80% of seniors and Medicare beneficiaries across the country can expect increases in their current stand-alone Medicare Part D prescription drug plan premiums unless they switch to a lower cost plan. However, monthly premium increases are only one of the changes seniors can expect in 2010. Slightly fewer Medicare Part D plans will be offered in 2010 and prescription drug plan designs will change with more plans implementing initial deductibles and reducing donut hole coverage. Seniors qualifying for the full low-income subsidy (LIS) will still find a number of prescription drug plans meeting their state’s $0 monthly premium benchmark – however, LIS qualified beneficiaries may need to move to new 2010 Part D plans in order to receive the $0 premium benefit. Seniors can find detailed 2010 stand-alone Medicare prescription drug plan information summarized for each state on the Q1Medicare.com website.

According to the 2010 CMS prescription drug plan landscape data, the average monthly stand-alone Medicare Part D premium across the nation (excluding the five United States territories) will increase to around $47 or 2% above the 2009 national monthly Part D premium average of $45.46. When taking into account Medicare Part D plan popularity, the national average monthly 2010 Medicare Part D plan premium, weighted by the number of people enrolled in each plan will increase to almost $39, an 11% increase over the 2009 weighted monthly premium of $34.61. Average monthly 2010 premium increases vary slightly by state. For example, the 2010 average Part D premium for seniors in New York state will increase to almost $48, a 6% increase over the 2009 average Part D plan premium of $45.04 and the 2010 New York weighted average monthly premium based on plan enrollment will increase to around $35, a 14% increase over the 2009 New York state weighted premium average of $30.50.

But seniors are reminded that monthly Part D premiums alone may only represent a small portion of their overall annual prescription drug plan cost. "National and state weighted premium averages show us a tendency for seniors to enroll in Part D plans with lower monthly premiums, but in many cases, monthly premiums are almost insignificant as compared to the thousands of dollars seniors may spend on prescription drugs," cautions Dr. Susan Johnson technical director of the Q1Medicare.com website. "Seniors should prepare to closely review their 2010 Part D options and ensure that they are provided the most affordable prescription drug coverage."

On a positive note, Part D plans may be showing a tendency toward standardization with a narrower range of 2010 premiums. The 2010 Medicare Part D plan premiums across the country extend from a low of $8.80 (First Health Part D - Secure in Oregon and Washington) to a high premium of $120.20 (Blue Rx Enhanced in Washington DC, Delaware, and Maryland). The 2009 national monthly premiums ranged from a low of $10.30 to $136.80.

Seniors will also find that, although the average 2010 monthly Medicare Part D plan premiums are increasing slightly, the number of 2010 Medicare Part D plan choices is actually shrinking; perhaps making the Part D plan selection process easier. Although a wide assortment of regional and local Medicare Part D plans are still offered across the country, the average number of 2010 Part D plans per state will decrease to 46 plans, down from the 2009 average of 49 Part D plans per state. Pennsylvania and West Virginia will offer the largest selection of 2010 Part D plans with 55 plans available, down from 57 plans in 2009. The states of Alaska and Hawaii offer the fewest 2010 Part D plan choices with 41 available plans.

Stand-alone prescription drug plan designs will also change in 2010. First, the majority of 2010 Part D plans will have some form of initial deductible. Part D plans with a $0 initial deductible decreased by 15% in 2010 as compared to 2009 plans. However, the initial deductibles may be lower than the $310 standard 2010 initial deductible. Also, fewer 2010 Part D plans offer some form of donut hole or gap coverage. As was expected, no 2010 Part D prescription drug plan will offer complete donut hole coverage. However, seniors in each state will have access to at least one 2010 Part D plan that offers limited brand-name drug coverage in the gap.

In 2010, Medicare beneficiaries will still find a fair selection of Part D plans qualifying for the low-income subsidy (LIS) $0 monthly premium in their states. But, the actual plans qualifying for the $0 LIS premium may have changed. The state with the largest number of LIS $0 premium plans is Arkansas with 14 Part D plans qualifying for the 2010 LIS $0 premium, up from 12 plans in 2009. The states with the fewest Part D plans qualifying for the 2010 LIS $0 premium were Maine and New Hampshire with three LIS $0 premium Part D plans, down from five plans in 2009. The state with the most Medicare beneficiaries qualifying for the low-income subsidy is California and there are six (6) Part D plans qualifying for the $0 premium, unchanged from 2009. However, two of the 6 plans are being offered by different Part D carriers. CMS has already noted that, because of changes in Part D plan premiums, some full low-income subsidy qualifying Medicare beneficiaries will be automatically reassigned to new 2010 Part D plans that will qualify for the $0 monthly premium – however, the number of auto-reassignments should be significantly lower than last year.

"Our online Part D plan summaries were designed to provide seniors and other Medicare beneficiaries with an overview of changes between the 2009 and 2010 stand-alone Medicare prescription drug plans," notes Dr. Johnson. "This year we also added a narrative feature or 'plain text' version of our prescription drug plan information so visitors can simply read a more qualitative summary of the 2010 PDP changes in their state."

The newly released 2010 Medicare Part D prescription plan information is available on Q1Medicare.com, or directly at PDP-Facts.com, along with other online tools, Frequently Asked Questions, and a free monthly Medicare Part D Newsletter all designed to help seniors, Medicare beneficiaries, advocates, and insurance agents navigate the Medicare Part D prescription drug program.

About the Website Q1Medicare.com
Q1Medicare.com is one of the largest independent online resources for Medicare Part D prescription drug plan information. The Q1Medicare.com website was designed and is operated by Q1Group LLC (Saint Augustine, FL). Site users are encouraged to follow Q1Medicare on Twitter at twitter.com/Q1Medicare.

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Lynnea Christner

Susan Johnson MS-MIS, MBA, PhD
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