Medicare Part D continues to be a marketplace with an array of competing plans offered at a wide range of premiums and benefit designs.
In 2015, there will be 1,001 standalone PDPs available nationwide, fewer than in any year since Part D began in 2006. Despite the reduction in plan availability nationwide, Medicare beneficiaries in each region will have a choice of 30 standalone PDPs, on average, down by five from 2014.
The average premium (weighted by 2014 plan enrollment) is expected to increase by 4 percent across all PDPs from 2014 to 2015, from $37.27 to $38.83 per month, unless many new or current enrollees select lower priced plans.
As in prior years, the average 2015 monthly premium masks a significant amount of variation across plans. Enrollees in six of the ten most popular PDPs will experience double-digit premium increases if they stay in the same plans in 2015, while enrollees in three of the ten most popular PDPs will see double-digit premium decreases.
Beneficiaries receiving Low-Income Subsidies (LIS) will have access to fewer plans for no monthly premium ("benchmark plans") in 2015 compared to 2014. About 1.8 million LIS enrollees who are slated to be in PDPs without so-called "benchmark" status for 2015 must switch plans (or be reassigned by CMS) in order to have premium - free coverage in 2015; an estimated 500,000 of these LIS beneficiaries will be reassigned by CMS.
Other notable trends for 2015 include:
Nearly all PDPs (87 percent) use pharmacy networks with preferred (lower) cost sharing offered in selected network pharmacies, up from 72 percent of PDPs in 2014, and a significant increase from just a few years ago when only a small share of plans used this type of preferred pricing (7 percent in 2011).
The use of formulary tiers has been common since the program’s beginning in 2006, but for the first time in 2015, all PDPs will use tiered cost sharing. Most PDPs will use five tiers (two for generic drugs, two for brand name drugs, and one for higher cost specialty drugs).
A growing share of PDPs has shifted from charging flat copayments to coinsurance for at least one of the tiers for brand name drugs.
