Most Medicare Part D beneficiaries are expected to encounter only small
increases—an average of 6 percent—in their insurance premiums in
2010. However, some low-income participants could be shifted automatically to
lower-cost plans if they don't indicate that they wish to remain with their
current plan when Medicare officials notify them about the impending
The Centers for Medicare and Medicaid Services (CMS) announced in August
that early plan bids indicated that the majority of beneficiaries enrolled in
Part D prescription drug plans would have monthly premium increases that
average only $2. That increase would bring the average monthly premium to $30
However, the changes could seriously affect some beneficiaries,
particularly low-income subsidy (LIS) beneficiaries in plans with 2010
premiums that are higher than the subsidy the federal government will pay
toward their coverage. In such cases, CMS automatically assigns beneficiaries
to new lower-cost plans unless they ask not to be switched. Medicare officials
estimate that about 800,000 LIS beneficiaries will need to move to a plan
charging at or below the benchmark subsidy amount or face automatic
reassignment. LIS beneficiaries can opt to stay in the same plan, but they
must pay any costs above the subsidy amount.
Nearly 10 million beneficiaries receive prescription drug coverage through
the LIS benefit, and it can amount to substantial financial assistance.
Generally, Part D beneficiaries are responsible for paying monthly premiums,
an annual deductible, and copayments. Those who qualify for full LIS
assistance pay no deductible or monthly premiums, however, and they are not
subject to falling into Part D's "donut hole"—the coverage
gap in prescription-drug costs that begins when the beneficiary has paid
$2,700 out of pocket and ends when the beneficiary reaches $4,350.
Any reassignment to a new plan could seriously impact Part D beneficiaries
with mental illness because not all drug plans cover psychotropic medications
CMS officials said they would release further details on Part D changes as
well as on premiums and benefits for Medicare Advantage plans in late
"Although most Part D plans should have relatively stable premiums,
all beneficiaries should compare their current coverage with the plans that
will be offered in 2010 when information becomes available in October,"
said Jonathan Blum, acting director of CMS's Center for Health Plan Choices,
in a written statement.
More information on 2010 Part D enrollment and related topics can be