Report: Part D premiums stay low despite fears of rising drug prices

Medicare Part D premiums are expected to stay pretty flat in the next few years, according to a new report, despite concerns with rising cost of specialty drugs.

The Centers for Medicare and Medicaid Services said it estimates the premium for a basic Medicare Part D plan will only go up $1 next year to a total of $32. For the past four years the average premiums for Medicare Part D plans have been between $30 and $31.

“Seniors and people with disabilities are benefiting from steady prescription drug premiums and a competitive and transparent marketplace for Medicare drug plans,” said CMS Administrator Marilyn Tavenner.  “And thanks to the Affordable Care Act, they are seeing improved benefits and saving on their medications.”

Lawmakers such as Rep. Henry Waxman (D-Calif.) have raised the alarm that rising costs of prescription drugs such as the $1,000 a pill hepatitis C drug Sovaldi could hurt the program.

Hepatitis C is most prevalent in baby boomers and according to health analysts Sovaldi alone could add between $2 billion and $6.5 billion to the Medicare Part D in 2015.

Waxman has proposed legislation that would allow the Department of Health and Human Services to negotiate down the price of drugs in Part D plans which it is currently prohibited from doing so.

In another report from the Congressional Budget Office Wednesday, federal spending on Medicare Part D was $50 billion less in 2013 than the agency had previously estimated.

CBO attributes the lower spending of the Medicare Part D program on more generic drugs that have recently become available and fewer brand name drugs that have come to market. The agency says enrollment in the program was also less than what they had previously estimated.