MedPAC Comments on Part D Spending

Staff of the Medicare Payment Advisory Commission (MedPAC) have responded to recent data from the Centers for Medicare and Medicaid Services (CMS) which indicated that enrollee premiums for Medicare Part D will remain stable for 2016. MedPAC argues that given the increase in aggregate Part D spending due to high-cost specialty drugs over the past year, which is predicted to continue through 2024, taxpayers will bear more of the risk for Part D spending over time due to individual reinsurance despite their premiums remaining stable. Individual reinsurance is one of Part D’s risksharing provisions through which Medicare pays plans 80 percent of benefit costs above Part D’s out-of-pocket threshold. While it was meant to encourage plans to enter the market for providing Medicare’s prescription drug benefit, MedPAC
concludes that Part D’s current risk-sharing structure does not provide adequate incentives for plan sponsors to manage the drug spending of high-cost enrollees.

Upcoming Congressional Meetings and Hearings

House Judiciary Committee: hearing titled “Planned Parenthood Exposed: Examining the Horrific Abortion Practices at the Nation’s Largest Abortion Provider;” 10:00 a.m., 2141 Rayburn Bldg.; Sept 9

House Energy and Commerce Health Subcommittee: hearing titled “Protecting Affordable Coverage for Employees;” 10:15 a.m., 2322 Rayburn Bldg.; Sept 9

House Judiciary Subcommittee on Regulatory Reform, Commercial and Antitrust Law: hearing titled “The State of Competition in the Health Care Marketplace: The Patient Protection and Affordable Care Act’s Impact on Competition;” 10:00 a.m., 2141 Rayburn Bldg.; Sept 10

House Energy and Commerce Health Subcommittee: hearing titled “Strengthening Medicaid Program Integrity and Closing Loopholes;” 9:15 a.m., 2322 Rayburn Bldg.; Sept 11

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