Critter Corner: Final Guidance Issued This Week to Help People with Medicare Prescription Drug Coverage

kiwi mangoDear Kiwi and Mango,

Although I’m on Medicare, the costs for my prescription drugs are still quite high, and frankly, I’m having trouble affording them. I heard something about a new guidance that was recently released to help people like me with costly prescription drugs. What is that all about? Thanks so much for your help!

Payton Formedds

Dear Payton,

This week, the Centers for Medicare & Medicaid Services (CMS) released the final guidance for the new Medicare Prescription Payment Plan. The Medicare Prescription Payment Plan, which begins in 2025, will give people with Medicare prescription drug coverage (Medicare Part D) the option to pay out-of-pocket costs in monthly payments spread out over the year rather than requiring they pay in full at the pharmacy counter each time they fill a prescription. Program participants will pay zero dollars to the pharmacy for covered Part D drugs, and Part D plan sponsors will then bill program participants monthly for any cost sharing they incur while in the program. This option can help program participants who face high-cost sharing for prescription drugs manage these costs by spreading them out over the course of the plan year.

According to Health and Human Services Secretary Xavier Becerra, “(f)or people who get their prescriptions through Medicare Part D and face high costs early in the year, we are easing the burden by allowing payments to be spread out over time. HHS will continue tackling high health care costs on all fronts so that every American can benefit from access to life-saving medicines.”

Other Helpful Cost-Saving Provisions

The Medicare Prescription Payment Plan complements the Inflation Reduction Act’s other provisions that lower prescription drug and health care costs. Here are some of those helpful cost-saving provisions:

  • As of January 1, 2024, people enrolled in Medicare Part D who have very high drug costs will, for the first time, no longer have to pay cost sharing for their prescription drugs in the catastrophic phase of the program.
  • Starting in 2025, all individuals with Medicare Part D will have their out-of-pocket prescription drug costs capped at $2,000.
  • On January 1, 2024, the law also expanded eligibility for full benefits under the Low-Income Subsidy program (LIS or Extra Help) under Medicare Part D.
    • Nearly 300,000 people with low and modest incomes currently enrolled in LIS are now benefiting from the program’s expansion including lowering drug costs such as no deductible, no premiums, and fixed, lowered copayments for certain medications.
    • An additional 3 million people could benefit from the Extra Help program now who are not currently enrolled.
  • The law also ensures that people with Medicare Part D and people with Part B who receive insulin delivered through a pump pay no more than $35 for a month’s supply of each covered insulin product.
  • It also provides coverage without patient cost sharing of recommended vaccines for people who have Medicare Part D.
  • It requires Part D sponsors to notify a pharmacy to provide information on the program for anyone who meets a $600 out-of-pocket threshold based on a single prescription at the point of sale.

For more details, please see the Medicare Prescription Payment Plan Final Guidance Fact Sheet here. We’re hoping this will help make your prescription drugs more affordable!

Kiwi and Mango

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About Renee Eder

Renee Eder is the Director of Public Relations for the Farr Law Firm, and gives the voice to the Critters of Critter Corner. Renee’s poodle, Penny, is an official comfort dog who she and her children bring to visit with seniors who are in the early stages of dementia at a local senior home once a month.

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