CMS Unveils Further Instructions on Initiative Allowing Medicare Beneficiaries to Manage Prescription Drug Expenses via Monthly Payments.
The Medicare Prescription Payment Plan, as outlined in the Inflation Reduction Act, will enable Medicare Part D beneficiaries to distribute out-of-pocket expenses across the year, starting in 2025.
Today, the Centers for Medicare & Medicaid Services (CMS) published the second segment of preliminary directives for the Medicare Prescription Payment Plan. These directives delineate the obligations for Medicare Part D plan sponsors, encompassing outreach and educational mandates, pharmacy protocols, and operational considerations for the plan's inaugural year, 2025.
This preliminary guidance forms part of the enactment process for President Biden's legislation on prescription drugs, the Inflation Reduction Act, designed to alleviate the burden of steep initial out-of-pocket prescription drug costs for seniors and individuals with disabilities under Medicare prescription drug coverage, by facilitating the spreading of costs over the year instead of requiring a lump-sum payment.
Scheduled for implementation in 2025, the Medicare Prescription Payment Plan is a constituent of the Inflation Reduction Act's array of measures aimed at curbing prescription drug and healthcare expenses. Other provisions of the law have already begun to mitigate costs for Medicare beneficiaries. Effective January 1, 2024, the legislation expanded eligibility for the Low-Income Subsidy program (LIS or "Extra Help") under Medicare Part D. Presently, nearly 300,000 individuals with low to moderate incomes who are enrolled in the program are reaping the benefits of this expansion, with an additional 3 million qualifying individuals yet to enroll.
Furthermore, as of January 1, 2024, for certain Medicare Part D beneficiaries facing exorbitant drug expenses, their out-of-pocket costs will be capped for the first time at approximately $3,300 to $3,800 for most individuals. The Medicare Prescription Payment Plan complements these provisions by affording individuals the option to spread their expenditures throughout the year rather than paying the entire out-of-pocket expense upfront.