Biden Administration Reveals Big Hike in Medicare Premiums
Posted on 11/15/2021
The Biden administration revealed a large hike in Medicare premiums Friday night (November 12, 2021). The U.S. government blamed the COVID-19 pandemic and a level of uncertainty over how much it may have to be forced to pay for a pricey new Alzheimer’s drug called Aduhelm made by Biogen Inc. The Medicare Part B standard monthly premium will rise by nearly US$ 22 to US$ 170.10 in 2022, according to the Centers for Medicare & Medicaid Services. Medicare is a national health insurance program in the United States that begun in 1965 under the Social Security Administration and now administered by the Centers for Medicare and Medicaid Services. Medicare primarily provides health insurance for Americans aged 65 and older, but also for some younger people with disability status as determined by the Social Security Administration.
Price Increases
Disclosed on November 12, 2021, the Centers for Medicare & Medicaid Services says the reason increases in the 2022 Medicare Part B premium and deductible are due to, “Rising prices and utilization across the health care system that drive higher premiums year-over-year alongside anticipated increases in the intensity of care provided.
Congressional action to significantly lower the increase in the 2021 Medicare Part B premium, which resulted in the $3.00 per beneficiary per month increase in the Medicare Part B premium (that would have ended in 2021) being continued through 2025.
Additional contingency reserves due to the uncertainty regarding the potential use of the Alzheimer’s drug, Aduhelm™, by people with Medicare. In July 2021, CMS began a National Coverage Determination analysis process to determine whether and how Medicare will cover Aduhelm™ and similar drugs used to treat Alzheimer’s disease. As that process is still underway, there is uncertainty regarding the coverage and use of such drugs by Medicare beneficiaries in 2022. While the outcome of the coverage determination is unknown, our projection in no way implies what the coverage determination will be, however, we must plan for the possibility of coverage for this high cost Alzheimer’s drug which could, if covered, result in significantly higher expenditures for the Medicare program.”
The Government Accountability Office (GAO) lists Medicare as a “high-risk” government program in need of reform, in part because of its vulnerability to fraud and partly because of its long-term financial problems.
Centers for Medicare & Medicaid Services, LINK: https://www.cms.gov/newsroom/fact-sheets/2022-medicare-parts-b-premiums-and-deductibles2022-medicare-part-d-income-related-monthly-adjustment
