Medicare Part D: Challenges Loom Ahead

Policymakers must act quickly to protect prescription coverage for America’s seniors.

Millions of Americans who rely on Medicare Part D may be facing sticker shock in 2020 if solutions that address out-of-pocket costs and access are not enacted quickly, based on a report from the Lupus Foundation of America.

Medicare Part D provides prescription drug coverage to more than 44 million Medicare recipients. While prescription drug coverage under part D hasn’t been around for as long as people may think, its popularity stems from its far reaching importance to the overall health of its millions of beneficiaries.

“Medicare did not offer a prescription drug benefit until Part D was enacted in 2003,” said Patrick Wildman, vice president of Advocacy & Government Relations for the Lupus Foundation of America. “Since then, it has greatly improved the health of so many people.” Beneficiaries include lupus patients, who incur an average of $12,643 per year in direct health care costs.

While Part D has been a big step, Wildman believes policymakers need to address looming challenges, including the impending “out-of-pocket” cliff, specialty tiers and more. The right policies will protect prescription medication coverage for America’s seniors, but Wildman notes we need the political will to make them happen.

The “Out-of-Pocket” Cliff

In 2005, the Lupus Foundation of America established the Medicare Access for Patients Rx (MAPRx) coalition — a group of more than 55 patient advocacy organizations representing seniors who depend on Medicare Part D for their prescription medications. The coalition recently published a report highlighting some of the challenges faced by Part D beneficiaries.

The most pressing issue, according to the report, is a steep increase in the “out-of-pocket” threshold, the amount patients pay before entering catastrophic coverage where their payment responsibility for their medicines drops to five percent for the remainder of the plan year. The Affordable Care Act capped how much that limit could increase each year. But the limit on growth of the threshold is set to expire in 2020, adding $1,250 to threshold in just one year, unless Congress acts.

“It is a looming crisis,” Wildman said. “As a coalition, we are worried that with that big of a spike, people may have challenges accessing medication they need.”

Infographic of Medicare Part D, Out of Pocket Spending

Specialty Tiers on the Rise

Part D plans also have been increasingly placing more medications on specialty tiers, which force seniors to pay up to a third of the costs for certain particularly expensive treatments. A study found that Part D beneficiaries pay an average of $3,949 annually out of pocket for specialty treatments for rheumatoid arthritis, $5,238 for multiple sclerosis and $6,322 for chronic myeloid leukemia. These chronic illnesses require several treatments that are frequently listed on specialty tiers.

Part D beneficiaries have no recourse to request exceptions to specialty tier pricing, either.9 The MAPRx coalition is fighting to change that.

“I think we need to fundamentally address the role of specialty tiers in Part D,” Wildman said. “Placing a medication on a specialty tier may stop some patients from filling their prescriptions and getting the treatment that they need.”

There is a lot of work still to be done to improve Medicare Part D for our seniors.

Improving Part D with an Out-of-Pocket Cap

While Medicare Part B beneficiaries can enroll in additional coverage that limits their annual out-of-pocket spending, most Part D beneficiaries must pay 5 percent of their medication costs after they hit the catastrophic phase without limit. Depending on what medications they have been prescribed, this can amount to thousands of dollars each month. But by putting an out-of-pocket cap in place, however, policymakers could help Part D beneficiaries better manage the financial burden of their conditions and illnesses, according to Wildman.

Strengthening and protecting access to medications is critical for millions of seniors with chronic diseases. The first step in this process, according to Wildman, is to convince policymakers how important the benefit is for seniors and people with disabilities, as well as others who depend on it. The coalition also wants to ensure that existing patient protections within the program stay in place and that recently introduced pricing policies do not restrict access.

“There is a lot of work still to be done to improve Medicare Part D for our seniors,” Wildman said. “We are looking forward to strengthening the program in the years to come.”

To learn more about Medicare Part D, read “Medicare Part D: 10 Years of Successfully Meeting Seniors’ Needs