October 2017 | Issue Brief Medicare Part D: A First Look at Prescription Drug Plans in 2018 Juliette Cubanski, Anthony Damico, Jack Hoadley, Kendal Orgera, and Tricia Neuman During the Medicare open enrollment period from October 15 to December 7 each year, beneficiaries can enroll in a plan that provides Part D drug coverage, either a stand-alone prescription drug plan (PDP) as a supplement to traditional Medicare, or a Medicare Advantage prescription drug plan (MA-PD), which provides all Medicare-covered benefits including drugs. Part D plans vary in numerous ways that can have a significant effect on an enrollee’s out-of-pocket spending, including premiums, deductibles, cost sharing, tier placement, the list of covered drugs, and preferred pharmacies. This issue brief provides an overview of the 2018 Part D PDP landscape, the largest segment of the Part D marketplace, with 20.4 million enrollees in 2017 (excluding enrollees in employer-only PDPs, for whom plan premium and benefits data are unavailable). For detail on the data and methods, see the Methods section. Key Findings  For 2018, Medicare beneficiaries will have a choice of 23 Medicare Part D stand-alone PDPs and 17 MA-PD plans in their area, on average.  The average monthly PDP premium will increase by 9 percent from 2017 t0 2018, to $43.48, weighted by 2017 plan enrollment. This estimate includes premiums for both basic and enhanced PDPs, assumes current PDP enrollees remain in their same plan, and makes no assumptions about plan choices by new enrollees or reassignment of low-income beneficiaries. 0 Figure S1  PDP premiums vary widely across plans in Average monthly premiums for the 10 most popular Medicare Part D 2018. Among the 10 PDPs with the highest stand-alone PDPs are projected to vary from $20 to $84 in 2018 enrollment, average premiums will range National PDP Average1 $43.48 from $20.21 per month ($243 per year) for Humana Walmart Rx $20.21 Humana Walmart Rx to $83.68 per month SilverScript Choice $26.39 ($1,004 per year) for AARP Medicare Rx Aetna Medicare Rx Saver $29.68 Preferred (Figure S1). WellCare Classic $30.37 Humana Preferred Rx  Almost all PDPs in 2018 have five cost- $31.33 Cigna-HealthSpring Rx Secure sharing tiers, but specific copayments and $35.18 AARP MedicareRx Saver Plus $45.26 coinsurance rates vary widely across PDPs. First Health Part D Value Plus $56.46 Nearly all PDPs charge coinsurance for Humana Enhanced $75.82 higher-cost specialty and non-preferred AARP MedicareRx Preferred $83.68 drugs, which usually results in higher out- NOTE: PDP is prescription drug plan. Estimates weighted by enrollment, excluding employer group plans. Estimates assume current of-pocket costs for enrollees than when PDP enrollees remain in their same plan; makes no assumptions about plan choices by new enrollees for 2018. 1National average includes premiums for basic and enhanced PDPs. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. plans charge copayments.  Medicare beneficiaries receiving the Low-Income Subsidy (LIS) will have a choice of six premium-free PDPs in 2018, on average. In 2018, 1.4 million low-income beneficiaries who are eligible for premium-free Part D coverage will pay Part D premiums averaging nearly $26 per month, unless they switch or are reassigned by CMS to premium-free plans. Findings Figure 1 The average Medicare beneficiary has a choice of 23 stand-alone PART D PLAN AVAILABILITY drug plans and 17 Medicare Advantage drug plans in 2018 Stand-alone PDPs MA-PD plans In 2018, beneficiaries across the country 56 55 continue to have a substantial number of Part 50 47 D plan choices.  The average beneficiary will have a choice 30 31 31 35 29 of 23 PDPs in 2018, compared to 22 in 26 26 26 23 21 22 2017 and 56 at the peak in 2007 (Figure 16 15 15 15 16 16 17 14 15 1). In 2018, beneficiaries will also have access to 17 MA-PD plans, on average, up from 16 in 2017. 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018  The number of PDPs per region in 2018 NOTE: PDP is prescription drug plan. MA-PD is Medicare Advantage drug plan. Plan counts are beneficiary weighted. Number of PDPs is reported at the region level; number of MA-PD plans is reported at the county level. Number of plans excludes Special Needs Plans, Medicare-Medicaid plans, and the territories except Puerto Rico. will range from 19 PDPs in Alaska to 26 SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 Part D plan files. PDPs in the Pennsylvania/West Virginia Figure 2 region (Figure 2; Appendix 1, Table The number of Medicare PDPs in 2018 varies from 19 PDPs in Alaska A1). The number of PDPs increased by one to 26 PDPs in Pennsylvania/West Virginia in every region compared to 2017, except 19-21 Plans 7 Regions 22-23 Plans 10 Regions 24 Plans 12 Regions 25-26 Plans 5 Regions Pennsylvania/West Virginia and North Carolina which have 2 more PDPs in 2018 22 23 24 OR, WA ME, NH than in 2017. IA, MN, MT, NE, ND, SD, WY 25 24 20 22 CT, MA, RI, VT 25  A total of 782 PDPs will be offered ID, UT 23 26 24 PA, WV 24 24 24 22 23 24 IN, KY NJ nationwide in the 34 PDP regions in 2018, 25 24 24 21 23 23 25 DE, DC, MD excluding PDPs in the territories. This 23 24 AL, TN 22 20 24 24 21 represents an increase of 36 PDPs, or 5 19 21 percent, since 2017, but a reduction of 104 20 HI plans, or 12 percent, since 2016 (Figure NOTE: PDP is prescription drug plan. Excludes PDPs in the territories. Total includes 2 sanctioned PDPs closed to new enrollees as 3). This total includes two plans that are of September 2017. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2018 PDP landscape source file. under sanction and thus not open to new Figure 3 enrollment for 2018. There are no new plan The total number of Medicare stand-alone prescription drug plans sponsors offering PDPs in 2018, but there across 34 PDP regions in 2018 is somewhat higher than in 2017 are new offerings by existing plan 1,866 1,824 sponsors. 1,687 1,576  The number of PDPs in 2018 represents 1,429 less than half the number offered at the 1,169 peak level of 1,866 plans in 2007. The 1,007 1,041 1,031 1,001 886 reduction in plan availability over time 746 782 reflects both the cumulative effect of mergers among plan sponsors and the response to CMS policies that encourage plan sponsors to eliminate low-enrollment 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 NOTE: Excludes plans in the territories. Totals include sanctioned plans closed to new enrollees as of September of prior year. SOURCE: Authors’ analysis of CMS 2006-2018 PDP landscape source files. Medicare Part D: A First Look at Prescription Drug Plans in 2018 2 plans and to drop multiple PDPs that are not meaningfully different from each other. PREMIUMS NATIONAL PREMIUM TRENDS The national average monthly PDP premium is expected to increase for the third year in a row—by 9 percent for 2018—based on current enrollment and assuming enrollees do not change plans. Even if a number of beneficiaries switch or are reassigned to lower-premium plans for 2018, the average premium is likely to be higher in 2018 than in 2017, and the three-year increase over the 2015 average premium will mark a significant shift upward.  The projected average monthly PDP Figure 4 premium for 2018 will be $43.48 (Figure The weighted average monthly premium for Medicare PDPs is 4). This represents a 9 percent projected projected to increase by 9 percent between 2017 and 2018 Projected increase ($3.58) from the weighted average $43.48 $45 monthly premium of $39.90 in 2017, and a $38.42 $37.52 $39.05 $39.90 $40 $37.01 $37.99 $37.67 $37.02 68 percent increase from $25.89 in 2006, $35 $34.81 $29.96 the first year of the Medicare Part D drug $30 $25.89 $27.27 benefit. The 2017 and 2018 estimates are $25 2017-2018: weighted by September 2017 enrollment. $20 9% projected increase, if current enrollees do not switch plans The 2018 estimate assumes that $15 $10 beneficiaries remain in their current plan $5 and does not take into account the impact $0 of the Low-Income Subsidy (LIS), which 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 lowers or eliminates premiums for NOTE: PDP is prescription drug plan. 2017 and 2018 numbers weighted by September 2017 enrollment. All other years weighted by March enrollment in each year. Includes premiums for both basic and enhanced PDPs but not MA-PD plans; 2018 projection assumes current PDP enrollees remain in their same plan and makes no assumptions about plan choices by new enrollees. qualifying beneficiaries. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 Part D plan files.  CMS reported that the average premium for basic Part D coverage offered by PDPs and Medicare Advantage drug plans will be an estimated $33.50 in 2018. The premium reported here differs from the CMS-published premium because our estimate is based on PDPs only and includes PDPs offering both basic and enhanced coverage; enhanced plans typically have higher premiums than basic plans. Our premium estimate does not make any assumptions about plan changes by current PDP enrollees, reassignment of Low-Income Subsidy (LIS) enrollees by CMS, or enrollment decisions by new PDP enrollees.  In prior years, the average premium calculated after taking into account enrollment decisions made during the open enrollment period has been 4 percent to 6 percent lower than the projection made assuming beneficiaries remain in their current plan. The difference is a result of existing enrollees switching to a lower premium plan, new enrollees choosing low-premium plans, and reassignments of some LIS beneficiaries to lower-premium plans. For example, the weighted average premium in March 2017, after plan elections for 2017 went into effect, was $40.42, which is 4 percent ($1.78) below the projected premium of $42.20 calculated prior to enrollment changes. Applying a similar adjustment to our projected premium for 2018 would produce a lower average premium after open enrollment, but one that would still be higher than in any previous year. DISTRIBUTION OF PDP ENROLLMENT BY PREMIUM AMOUNT  Among the 12.6 million Part D PDP enrollees who are responsible for paying the entire premium (which excludes LIS recipients), many enrollees pay premiums that are well above the national average. In 2018, Medicare Part D: A First Look at Prescription Drug Plans in 2018 3 over one-third of PDP enrollees not Figure 5 receiving the LIS (35 percent) are projected In 2018, over one-third of PDP enrollees not receiving low-income to pay monthly premiums of at least $60 if subsidies are projected to pay monthly premiums of at least $60 if they stay in their current plans they stay in their current plans (Figure 5). Distribution of Current PDP Enrollment by Monthly Premium, 2017 (Actual) and 2018 (Projected), Excluding Enrollees Who Receive Low-Income Subsidies Among them, more than 380,000 (3 $100 or more 3% 3% percent of non-LIS enrollees) are projected $60 to <$100 30% 32% to pay monthly premiums of at least $100. $40 to <$60 $20 to <$40 6%  The share of non-LIS enrollees who will Less than $20 12% pay monthly premiums less than $20 if 40% they stay in their current plan is projected 49% to decline substantially between 2017 and 20% 4% 2018—from 20 percent of all non-LIS 2017 2018 enrollees in 2017 to 4 percent in 2018— 2017 Non-LIS PDP Enrollment = 12.6 million while the share of non-LIS enrollees paying NOTE: PDP is prescription drug plan. LIS is Low-Income Subsidy. Analysis excludes enrollees for whom CMS provides no crosswalk between their 2017 and 2018 PDPs. 2018 distribution assumes no plan changes during the open enrollment period. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. between $20 and $40 per month is expected to increase from 40 percent in 2017 to 49 percent in 2018. PREMIUM VARIATION AND CHANGES FOR PDPS WITH THE MOST ENROLLEES PDP premiums will continue to vary widely Figure 6 by plan in 2018, as in previous years. Average monthly premiums for the 10 most popular Medicare Part D stand-alone PDPs are projected to vary from $20 to $84 in 2018  Among the 10 PDPs with the highest National Average1 $43.48 enrollment, average PDP premiums in Humana Walmart Rx 2.4 million enrollees $20.21 2018 will range from a low of $20.21 per SilverScript Choice $26.39 4.2 million enrollees month, or $243 annually, for the Humana Aetna Medicare Rx Saver $29.68 1.1 million enrollees Walmart Rx PDP to a high of $83.68 per WellCare Classic 1.0 million enrollees $30.37 month, or $1,004 annually, for the AARP Humana Preferred Rx 1.8 million enrollees $31.33 Cigna-HealthSpring Rx Secure MedicareRx Preferred PDP (Figure 6). 0.5 million enrollees $35.18 AARP MedicareRx Saver Plus $45.26  There is no national PDP available in all 34 1.1 million enrollees First Health Part D Value Plus $56.46 regions for under $20 in 2018, in contrast 0.8 million enrollees Humana Enhanced 0.9 million enrollees $75.82 to previous years, although in 25 of 34 AARP MedicareRx Preferred $83.68 2.8 million enrollees regions, there is at least one PDP with a NOTE: PDP is prescription drug plan. Estimates weighted by enrollment, excluding employer group plans. Estimates assume current 1 PDP enrollees remain in their same plan; makes no assumptions about plan choices by new enrollees for 2018. National average premium under $20. The EnvisionRxPlus includes premiums for basic and enhanced PDPs. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. PDP is available in 12 regions for $12.60, while Humana Walmart Rx PDP is available in 2 regions for $18.40 (but $20.40 in 32 regions). Five different sponsors have the lowest premium in at least one region.  At the high end, 14 PDPs have premiums of at least $125 per month. The highest is $197.10 for Blue Cross MedicareRx Plus PDP in Texas. None of these PDPs, which are mostly offered by sponsors that serve only one region or a few regions, has more than 51,000 enrollees in 2017. Changes to premiums from 2017 to 2018, averaged across regions and weighted by 2017 enrollment, also vary widely across some of the most popular PDPs, as do the absolute amounts of monthly premiums for 2018 (Table 1). Medicare Part D: A First Look at Prescription Drug Plans in 2018 4 Table 1: Monthly Premiums for PDPs with Highest Enrollment 2017 enrollment Weighted average monthly (# in millions) premium1 Percent change First First Type of year % of First 2017- year- Name of PDP plan offered # total year 2017 2018 2018 2018 SilverScript Choice Basic 2006 4.24 20.8% $28.32 $29.05 $26.39 -9% -7% AARP MedicareRx Preferred Enhanced 2006 2.80 13.7 $26.32 $71.66 $83.68 17% 218% Humana Walmart Rx Enhanced 2014 2.38 11.7 $12.60 $16.81 $20.21 20% 60% Humana Preferred Rx Basic 2011 1.85 9.1 $14.80 $27.24 $31.33 15% 112% Aetna Medicare Rx Saver Basic 2006 1.15 5.6 $31.51 $31.33 $29.68 -5% -6% AARP MedicareRx Saver Plus Basic 2013 1.06 5.2 $15.00 $37.22 $45.26 22% 202% WellCare Classic Basic 2007 1.05 5.1 $15.70 $29.21 $30.37 4% 93% Humana Enhanced Enhanced 2006 0.88 4.3 $14.13 $64.17 $75.82 18% 437% First Health Part D Value Plus Enhanced 2012 0.76 3.7 $25.44 $44.91 $56.46 26% 122% Cigna-HealthSpring Rx Secure Basic 2006 0.54 2.6 $30.94 $27.77 $35.18 27% 14% TOTAL FOR ALL PDPS 20.38 100% $25.89 $39.90 $43.48 9% 68% NOTE: PDP is prescription drug plan. Plan names can change from year to year; plans are designated the same if they have the same contract/plan ID. Analysis excludes enrollees in employer group plans and the territories except Puerto Rico. 1Average premiums are weighted by enrollment for each year (September 2017 enrollment for 2017 and 2018 premiums). SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 Part D plan files.  Average premiums for 8 of the 10 largest Figure 7 PDPs are projected to increase for 2018, by Average monthly premiums for 8 of the 10 most popular PDPs are about $8 per month on average, assuming projected to increase for 2018 $16.81 2017 average current enrollees do not switch plans Humana Walmart Rx 20% $20.21 monthly premium $29.05 (Figure 7). For 7 of the 8 PDPs, the SilverScript Choice -9% $26.39 (national average: $39.90) $31.33 increase is at least 15 percent—nearly twice Aetna Medicare Rx Saver -5% $29.68 2018 average monthly premium $29.21 as large as the rate of increase in the WellCare Classic 4% $30.37 (national average: $43.48) national average premium. For two of Humana Preferred Rx 15% $27.24 $31.33 these PDPs (First Health Part D Value Plus Cigna-HealthSpring Rx Secure 27% $27.77 $35.18 and Cigna-HealthSpring Rx Secure) the AARP MedicareRx Saver Plus 22% $37.22 $45.26 increase is more than 25 percent. In dollar First Health Part D Value Plus 26% $44.91 $56.46 terms, the weighted average monthly Humana Enhanced 18% $64.17 $75.82 premium is projected to increase by more AARP MedicareRx Preferred 17% $71.66 $83.68 than $10 for three of the 10 largest PDPs. NOTE: PDP is prescription drug plan. Estimates weighted by enrollment, excluding employer group plans. Estimates assume current PDP enrollees remain in their same plan; makes no assumptions about plan choices by new enrollees for 2018.  Enrollees in the PDP with the most SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. enrollees in 2017, SilverScript Choice (4.2 million enrollees), will see a 9 percent reduction in their monthly premium for 2018 if they remain in the same plan, from $29.05 to $26.39. The only other PDP among the top 10 that is lowering its monthly premium is Aetna Medicare Rx Saver, with a 5 percent reduction in the monthly premium.  Enrollees in the second largest PDP, UnitedHealth’s AARP MedicareRx Preferred (2.8 million enrollees), will face a 17 percent increase in the average monthly premium, from $71.66 to $83.68. Of the 10 most popular PDPs, this plan is projected to have the highest monthly premium in 2018, as it did in 2017. Medicare Part D: A First Look at Prescription Drug Plans in 2018 5 Monthly premiums for the three most popular PDPs available since the start of the Part D program in 2006 have changed in substantially different ways. Whereas one of the oldest PDPs is projected to have a lower premium in 2018 than in 2006, the other two PDPs have raised premiums repeatedly.  The monthly premium for SilverScript Choice, with the highest number of PDP enrollees overall (4.2 million enrollees in 2017), is 7 percent lower in 2018 ($26.39) than it was in 2006 ($28.32).  By contrast, the average premium for Humana Enhanced PDP, with 0.9 million enrollees in 2017, is more than five times higher than it was in 2006, having increased from $14.13 to $75.82.  The average premium for UnitedHealth’s AARP Preferred MedicareRx PDP, the PDP with the second highest number of enrollees in 2017 (2.8 million), has more than tripled since 2006, from $26.32 to $83.68 in 2018. PREMIUM VARIATION AND CHANGES BY REGION Average PDP monthly premiums, weighted by 2017 enrollment, will vary in 2018 across regions, along with the change in premiums from 2017 to 2018. Figure 8  Average PDP premiums will range from Monthly premiums for Medicare PDPs vary across the 34 PDP regions, from $34.61 in Arkansas to $49.34 in New Jersey $34.61 per month in the Arkansas region Medicare Part D Stand-Alone PDP Weighted Average Monthly Premiums by Region, 2018 (one of only three regions with an average $34 to <$41 $41 to <$43 $43 to <$45 9 Regions 9 Regions $45+ National Average: 9 Regions 7 Regions $43.48 around $35) to $49.34 per month in New Jersey—40 percent higher than in $41.90 OR, WA $37.66 IA, MN, MT, NE, $44.82 $44.77 ME, NH ND, SD, WY Arkansas (Figure 8; Appendix 1, Table $44.94 $41.89 $47.42 $42.79 CT, MA, RI, VT ID, UT A2). Three other large states (California, $43.30 $44.67 $42.55 $45.44 $41.00 $41.53 $43.95 PA, WV $49.34 NJ Florida, and New York) have projected $41.51 IN, KY $45.30 $41.52 $47.42 $43.71 $44.39 DE, DC, MD $44.19 average premiums around $47, above the $34.61 AL, TN $45.51 $35.31 $40.32 $37.83 $40.67 national average. $42.05 $38.50 $47.55 $40.29 FL  Projected average premiums are higher in $34.62 HI 2018 than in 2017 in every region, but the NOTE: PDP is prescription drug plan. Average premiums are weighted by September 2017 enrollment, include premiums for both level of increase varies by region. For basic and enhanced PDPs, and assume current PDP enrollees remain in their same plan. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. example, the average premium in New Jersey is projected to rise by 1 percent and Figure 9 If current PDP enrollees do not switch plans, nearly three-fourths will by no more than 6 percent in three other see an increase in their monthly premium for 2018 regions. By contrast, average premiums Distribution of Medicare Part D Stand-Alone PDPs Enrollees not Receiving Low-Income Subsidies, by Amount of Projected Premium Change, 2017-2018 will increase by more than 10 percent in 13 Decrease of Decrease of Decrease of Increase of Increase of Increase of regions, including an increase of 17 percent $10 or more $5 to <$10 less than $5 less than $5 $5 to <$10 $10 or more in both Colorado and New Mexico. 27% decrease 73% increase PREMIUM INCREASES AND DECREASES FOR CURRENT ENROLLEES Non-LIS enrollees 2% 3% 22% 31% 9% 34% Overall, more Part D enrollees are projected (n=12.6 million) to face higher premiums in 2018 if they stay in their current plans, compared to the share of enrollees who were facing projected increases for 2017. And a larger share of NOTE: PDP is prescription drug plan. LIS is low-income subsidy. Analysis excludes enrollees for whom CMS provides no crosswalk between their 2017 and 2018 PDPs. Estimates do not sum to total due to rounding. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. current enrollees will see premiums increase than decrease if they remain in their current plan (Figure 9). Medicare Part D: A First Look at Prescription Drug Plans in 2018 6  Among the 12.6 million Part D PDP enrollees who are responsible for paying the entire premium (which excludes LIS recipients), nearly three-fourths (73 percent) are projected to have a higher premium in 2018 if they stay in their current plans, compared to 63 percent who faced higher premiums if they didn’t switch plans for 2017.  More than one-third of non-LIS enrollees (34 percent, or 4.2 million) are projected to have a premium increase of at least $10 per month if they remain in their current plans. By contrast, 2 percent (about 248,000 non-LIS PDP enrollees) are projected to see their premiums decrease by $10 or more.  For non-LIS enrollees facing a projected premium increase, the average monthly increase will be $8.50. Those projected to see lower premiums will experience a smaller change—an average reduction of $4.71. BENEFIT DESIGN In 2018, for the third year in a row, all Part D PDPs will offer an alternative benefit design to the defined standard benefit, which has a $405 deductible in 2018 and 25 percent coinsurance for all covered drugs. Some plans modify or eliminate the deductible, and virtually all PDPs will have a benefit design with five tiers for covered generic and brand-name drugs. BASIC VERSUS ENHANCED BENEFITS Part D plans must offer either the defined standard benefit or an alternative equal in value (“actuarially equivalent”), which is the basic Part D benefit, and can also provide enhanced benefits.  In 2018, almost half (46 percent) of plans Figure 10 will offer basic Part D benefits (although no Compared to earlier years, a larger share of Medicare PDPs in 2018 plans will offer the defined standard are enhanced plans, charging higher premiums for this coverage benefit), while 54 percent will offer Enhanced enhanced benefits (Figure 10). This is PDPs similar to the distribution in 2017, but over 42% 48% 51% 53% 51% 43% 48% 50% 50% 50% 52% 54% 54% time, the share of PDPs offering enhanced Basic PDPs benefits has increased while the share offering basic benefits has decreased.  The weighted average premium in 2018 for 58% 52% 49% 57% 52% 50% 50% 46% 50% 48% 46% 47% 49% enhanced benefit PDPs ($60.48) is nearly double the monthly premium for PDPs offering the basic benefit ($31.60), 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 assuming no change in enrollment. The NOTE: PDP is prescription drug plan. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 PDP landscape source files. weighted average premium is projected to increase by 2 percent for basic-benefit PDPs, from $31.12 in 2017 to $31.60 in 2018, but by a much larger 15 percent for enhanced-benefit PDPs, from $52.48 to $60.48. In 2017, 41 percent of PDP enrollees were in enhanced-benefit plans. DEDUCTIBLES The standard (maximum) Part D deductible is increasing by a modest $5 in 2018 from $400 to $405, compared to a $40 increase between 2016 and 2017 (from $360 to $400). The increase results from a statutory formula that adjusts the amount each year based on the annual percentage increase in average per capita aggregate expenditures for covered Part D drugs, and prior year revisions. For 2018, the annual percentage Medicare Part D: A First Look at Prescription Drug Plans in 2018 7 increase was 1.22 percent. Other amounts for Figure 11 the standard benefit design parameters are Over half of Medicare PDPs charge the standard deductible in 2018 increasing by this percentage as well ($405), while 37 percent of PDPs charge no deductible (Appendix 2). Standard deductible  Nearly two-thirds of PDPs (63 percent) will Partial 34% 31% 33% 33% 36% 41% 43% 45% 49% 44% 48% charge a deductible in 2018, the same deductible 53% 52% 8% 8% share as in 2017 (Figure 11). More than No deductible 8% 11% 24% 10% half of PDPs with a deductible will charge 20% 10% 4% 14% 15% 11% 14% the standard $405 amount (52 percent), a 61% 58% 58% 55% somewhat larger share than in 2017. 40% 39% 47% 45% 47% 42% 37% 37% 33% Another 11 percent of all PDPs charge a partial deductible, an amount below the Standard deductible 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 standard deductible. amount: $250 $265 $275 $295 $310 $310 $320 $325 $310 $320 $360 $400 $405  Part D enrollees are projected to be in NOTE: PDP is prescription drug plan. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 PDP landscape source files. plans with a deductible of $207 in 2018, on average (Figure 12). This is unchanged Figure 12 from the weighted average deductible in The weighted average deductible for PDPs will be $207 in 2018, unchanged from 2017 but nearly double the amount in 2006 2017, but the average is up from $107 in 2006—a 93 percent increase, substantially $450 Standard deductible Weighted average deductible $400 $405 higher than the increase in the average $400 $360 premium. $350 $310 $310 $320 $325 $310 $320 $295 $300 $265 $275 TIERED COST SHARING $250 $250 $207 $207  As in recent years, all PDPs in 2018 will use $200 $149 $169 $153 $173 $174 $171 $157 $181 $133 tiered cost sharing; all but two PDPs (two $150 $107 $121 local plans offered by the same plan $100 $50 sponsor, with few enrollees) will have five $0 tiers. The typical five-tier design includes 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 tiers for preferred generics, generics, NOTE: PDP is prescription drug plan. 2017 and 2018 numbers weighted by September 2017 enrollment. All other years weighted by March enrollment in each year. Average for 2018 assumes current PDP enrollees remain in their same plan. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 Part D plan files. preferred brands, non-preferred drugs (including a mix of brands and generics), and specialty drugs. Five-tier formularies have been the most common type since 2013.  Overall, PDP cost-sharing amounts in 2018 are relatively similar to 2017 levels. For generic tiers, median copayments across PDPs are $1 for the preferred generic tier and $6 for the generic tier (formerly labeled the non-preferred generic tier in plans with two generic tiers). About 1 in 5 PDPs (19 percent) charge $0 for preferred generics to encourage use of these drugs, whereas a few charge $5 or more. A small number of PDPs charge $0 for both of their generic tiers. Copayments for generics (those not designated as preferred) vary more widely—from $0 to $20.  Most PDPs charge copayments for preferred brand tiers, but one-fourth of PDPs in 2018 (24 percent) charge coinsurance. For preferred brand tiers, the median copayment in 2018 is $37, varying from $18 to $47; the median coinsurance rate is 20 percent.  PDPs have increasingly charged coinsurance in place of flat copayments for non-preferred drugs, previously labeled non-preferred brands—often more expensive drugs or those for which plans have not negotiated Medicare Part D: A First Look at Prescription Drug Plans in 2018 8 large rebates from manufacturers. In 2018, virtually all PDPs are using coinsurance for their non-preferred drug tiers. The median coinsurance PDPs charge for non-preferred drugs is 40 percent, but coinsurance rates range from 24 percent to 50 percent.  Since 2006, nearly all PDPs have charged coinsurance for the specialty tier. In 2018, the threshold for drugs to qualify for placement on a specialty tier is $670 for a one-month supply of the drug, the same as in 2017. For all PDPs, the specialty tier coinsurance ranges from 25 percent to 33 percent (the most allowed by CMS guidelines); most PDPs charge either 25 percent or 33 percent. TIERED COST SHARING IN PDPS WITH THE MOST ENROLLEES  Cost sharing for the ten largest PDPs varies across plans (Table 2). Two of the largest PDPs (Humana Preferred and WellCare Classic) have a $0 copayment for preferred generic drugs in 2018. Median copayments for generics range from $1 to $14 among the ten largest PDPs.  Eight of the 10 largest PDPs charge copayments for preferred brands, varying from $30 (Aetna Medicare Rx Saver) to $47 (First Value Part D Value Plus). Three of the top PDPs reduced their copayments for preferred brands between 2017 and 2018. One of the top PDPs (AARP MedicareRx Saver Plus) increased its preferred brand copayment from $21 to $32.  Coinsurance for non-preferred drugs varies in 2018 from 35 percent for three of the top PDPs to 50 percent (First Health Part D Value Plus), the maximum allowed by CMS guidance. Two of the top ten PDPs reduced the coinsurance for non-preferred brands (SilverScript Choice and WellCare Classic), but one PDP increased its coinsurance rate from 30 percent to 39 percent (AARP Medicare Rx Saver Plus).  Five of the top PDPs use 25 percent coinsurance for their specialty tiers, the maximum allowed for plans with a standard deductible. One top PDP charges 26 percent coinsurance for specialty tier drugs, while the remaining four top PDPs charge 33 percent. Table 2: Median Cost Sharing (Copayments or Coinsurance Rates) for PDPs with the Highest Enrollment, 2017-2018 Preferred Preferred Non-preferred Specialty generics Generics brands drugs drugs Name of PDP 2017 2018 2017 2018 2017 2018 2017 2018 2017 2018 SilverScript Choice $3 $3 $14 $14 $46 $42 50% 46% 33% 33% AARP MedicareRx Preferred $3 $5 $10 $12 $35 $37 40% 40% 33% 33% Humana Walmart Rx $1 $1 $4 $4 20% 23% 35% 35% 25% 25% Humana Preferred Rx $0 $0 $1 $1 20% 20% 35% 35% 25% 25% Aetna Medicare Rx Saver $1 $1 $2 $2 $30 $30 35% 35% 25% 26% AARP MedicareRx Saver Plus $1 $1 $2 $7 $21 $32 30% 39% 25% 25% WellCare Classic $0 $0 $14 $1 $46 $35 49% 42% 25% 25% Humana Enhanced $3 $3 $7 $7 $42 $42 44% 44% 33% 33% First Health Part D Value Plus $2 $1 $5 $2 $47 $47 50% 50% 33% 33% Cigna-HealthSpring Rx Secure $2 $1 $7 $5 $40 $35 45% 39% 25% 25% NOTE: PDP is prescription drug plan. Estimates are weighted medians for those plans that vary cost sharing by region (weighted by September 2017 enrollment). SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. Medicare Part D: A First Look at Prescription Drug Plans in 2018 9 GAP COVERAGE In 2018, most Part D plans will offer no gap coverage beyond what is required under the basic benefit; because of the Affordable Care Act provision to gradually close the gap by 2020, all enrollees will have substantial coverage in the gap regardless of which plan they are enrolled in. Under the basic benefit, in 2018, manufacturer prices for brand-name drugs purchased in the gap phase of the benefit will be discounted by 50 percent, with plans paying an additional 15 percent of the cost and enrollees responsible for 35 percent. Plans will pay 56 percent of the cost for generic drugs in the gap phase, with enrollees paying 44 percent.  In 2018, 35 percent of all PDPs will offer Figure 13 some additional gap coverage beyond what Two-thirds of Medicare PDPs in 2018 will offer no additional gap the basic benefit covers, an increase from coverage beyond what the basic benefit covers 28 percent in 2017 (Figure 13). In 2018, the coverage gap is partially filled by a 50% price discount plus 15% plan coverage for brand-name drug costs and 56% plan coverage of generic drug costs, as required by the ACA UnitedHealth’s AARP MedicareRx Additional Preferred expanded additional gap gap 15% 25% 20% 24% 22% coverage 29% 29% 26% 26% 28% 33% coverage from two PDP regions in 2017 to 34% 35% No all 34 regions in 2018, and Aetna Medicare additional gap Rx Select, a new PDP in 2018, will offer coverage additional gap coverage in the 20 regions 85% 71% 71% 75% 80% 74% 76% 74% 78% 72% 67% 66% 65% where this plan is available.  Plans that offer additional gap coverage charge significantly higher premiums than 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 those that do not. In 2018, the average NOTE: PDP is prescription drug plan. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 PDP landscape source files. monthly premium for PDPs with additional gap coverage will be $79.92, versus $30.92 for PDPs with no additional gap coverage beyond what the basic benefit covers. Given the level of gap coverage that all plans are required to provide, the value of the additional gap coverage may not be worth the extra $50, on average, for plans that offer it. LOW-INCOME SUBSIDY (BENCHMARK) PLANS In 2018, the total number of premium-free benchmark plans—that is, PDPs available for no monthly premium to Low-Income Subsidy (LIS) enrollees—will Figure 14 be lower than in 2017 and the lowest level The number of premium-free benchmark PDPs in 2018—216, or 6 per since the program started in 2006 (Figure region, on average—is lower than in any preceding year 14; Appendix 1, Table A3). 642 De minimis plans* Benchmark plans  In 2018, 216 plans will be premium-free 153 495 benchmark plans available for enrollment 53 408 of beneficiaries receiving the LIS. This 331 352 represents a decrease of 15 PDPs qualifying 308 307 315 327 79 283 62 75 as benchmark plans (a 6% decrease) from 489 113 54 218 231 216 408 442 24 14 49 2017 and the lowest number of benchmark 308 307 273 253 252 218 229 plans available since the start of the Part D 169 207 202 program in 2006. Share 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 of  On average (weighted by enrollment), LIS PDPs: 29% 34% 27% 18% 19% 31% 31% 32% 30% 28% 25% 31% 28% beneficiaries have 6 benchmark plans NOTE: PDP is prescription drug plan. *De minimis plans can retain Low-Income Subsidy beneficiaries despite exceeding the benchmark premium by a minimal amount (up to $2 in 2018). SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 PDP landscape source files. available to them for 2018, or about one- Medicare Part D: A First Look at Prescription Drug Plans in 2018 10 fourth the average number of PDP choices available overall. All LIS enrollees can select any plan offered in their area, but if they enroll in a non-benchmark plan, they must pay some portion of their chosen plan’s monthly premium.  Of the 216 benchmark plans in 2018, 14 plans qualify through the “de minimis” policy—fewer than the 24 de minimis plans in 2017. The de minimis policy makes it easier for plans to qualify by allowing them to waive a premium amount of up to $2 in order to retain their LIS enrollees. Plans qualifying through the de minimis policy are eligible for new enrollees, but will not receive auto-assigned enrollees.  Among the 2017 benchmark PDPs, two plans (AARP MedicareRx Saver Plus and Cigna-HealthSpring Rx Secure) lost their benchmark status in several regions, accounting for much of the decline in benchmark plan availability between 2017 and 2018. In total, 26 PDPs have lost their benchmark status for 2018, while 11 PDPs will newly qualify as benchmark plans. BENCHMARK PLANS BY REGION Figure 15 The number of benchmark PDPs in 2018 varies across regions from 2  The number of benchmark plans available PDPs in Florida to 10 PDPs in Delaware/D.C./Maryland and Arizona in 2018 will vary by region, from just two 2-4 Plans 5-6 Plans 7 Plans 8-10 Plans benchmark PDPs in Florida (out of 21 7 Regions 9 Regions 10 Regions 8 Regions PDPs overall) to 10 benchmark PDPs in the 7 7 Delaware/Maryland/District of Columbia OR, WA 5 IA, MN, MT, NE, ND, SD, WY 8 ME, NH 9 8 7 region (out of 21 PDPs) (Figure 15). 8 ID, UT CT, MA, RI, VT 6 9 3 8 7 PA, WV 7  Benchmark plan availability will be 6 4 4 IN, KY 6 NJ 10 5 unchanged in 10 of 34 regions between 10 7 7 4 6 AL, TN 7 DE, DC, MD 4 2017 and 2018. Nineteen regions will 7 6 6 5 experience a decline in of one or two 7 2 4 benchmark plans, while five regions will HI experience an increase in benchmark plan NOTE: Includes “de minimis” plans that can retain Low-Income Subsidy beneficiaries despite exceeding the benchmark premium by up to $2 in 2018. availability of one or two plans. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2018 PDP landscape source file. BENCHMARK PLANS BY SPONSOR Figure 16 The number of premium-free plans for LIS The number of benchmark PDPs available in the 34 PDP regions from three major Part D organizations has varied over time enrollees offered by the three largest Part D Number of 2006 2008 2010 2012 2014 2016 2018 sponsors (based on total enrollment)—CVS PDP regions (out of 34): Health/SilverScript, Humana, and 31 32 32 31 34 34 33 31 31 34 30 UnitedHealth—has fluctuated substantially 27 28 26 27 29 over the years (Figure 16).  In 2018, nearly two-thirds of LIS PDP 16 15 enrollees (64 percent) are projected to be 12 in PDPs operated by these three plan 4 3 sponsors; including PDPs offered by Aetna brings to share up to 75 percent. All four CVS Health/SilverScript Humana UnitedHealth 2,412,000 LIS PDP 1,446,000 LIS PDP 1,141,000 LIS PDP sponsors offer PDPs that qualify as enrollees in 2017 enrollees in 2017 enrollees in 2017 NOTE: PDP is prescription drug plan. LIS is low-income subsidy. Number of LIS enrollees excludes Medicare Advantage and benchmark plans in at least 29 of the 34 employer group plan enrollees. Enrollment estimates from March 2017. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 PDP landscape source files. PDP regions in 2018. Medicare Part D: A First Look at Prescription Drug Plans in 2018 11  For 2018, six PDP sponsors will offer benchmark plans in at least half of the 34 regions (including PDPs designated as de minimis plans, which will not receive auto-assigned enrollees). No sponsor will offer benchmark plans in all 34 regions in 2018; one sponsor (Aetna) will offer benchmark plans in 33 regions, and one sponsor (CVS Health) will do so in 32 regions. IMPACT OF BENCHMARK PLAN CHANGES FOR LOW-INCOME SUBSIDY ENROLLEES  About 1.4 million LIS beneficiaries—nearly Figure 17 one in five LIS enrollees in PDPs in 2017 1 in 5 Low-Income Subsidy PDP enrollees are projected to pay (19 percent)—are enrolled in PDPs in 2017 premiums for non-benchmark plans in 2018 if they don’t switch that will not qualify as benchmark plans in 2017 plan IS a premium-free (benchmark) plan in 2018 Distribution of LIS enrollees in 2017 plans that are not 2017 plan IS NOT a premium-free (benchmark) plan in 2018 2018 (Figure 17). CMS will reassign those premium-free for 2018 LIS enrollees who were randomly assigned 27% AARP MedicareRx Saver Plus by CMS to their current plan, and several 23% states will help reassign those enrolled in AARP MedicareRx 6.3 million 1.4 million Preferred their state pharmacy assistance programs LIS enrollees LIS enrollees 14% (81%) (19%) (SPAPs). Many other LIS beneficiaries who Humana Preferred Rx First Health Part D Value Plus 7% are currently not enrolled in plans that will 7% Humana Enhanced be premium-free in 2018 must switch 23% All other plans plans on their own or pay a premium if Total LIS Enrollment in PDPs in 2017 = 7.8 million they remain in their 2017 plan. Those in NOTE: PDP is prescription drug plan. LIS is Low-Income Subsidy. Analysis assumes no change in enrollment or reassignment of current LIS enrollees; excludes enrollees for whom CMS provides no crosswalk between their 2017 and 2018 PDPs. Estimates do the latter group will not be automatically not sum to total due to rounding. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. reassigned by CMS because in the past they or someone assisting them made a choice to switch plans.  On average, these 1.4 million LIS beneficiaries face PDP premiums that average $25.56 per month in 2018 ($307 per year) if they do not change plans or are not reassigned by CMS to new plans, compared to an average of $23.85 for LIS enrollees who faced premiums in 2017 if they stayed in their plans. Nearly half (49 percent) are projected to pay premiums of at least $20 per month, and 3 percent will pay at least $60 per month, if they do not switch plans. In 2017, LIS beneficiaries who paid monthly premiums for their coverage paid $26.65 on average.  Among the LIS beneficiaries who may pay premiums in 2018, 38 percent (544,000) are in benchmark plans in 2017; the remaining 62 percent (903,000) are currently enrolled in non-benchmark plans and thus paid a premium in 2017. No one in the latter situation will be eligible for reassignment by CMS to a premium-free plan, and would need to switch to a premium-free plan on their own to avoid paying premiums. About half (46 percent) of the LIS enrollees who may pay premiums are in enhanced PDPs.  About three-fourths of the 1.4 million LIS beneficiaries projected to pay premiums are currently enrolled in just five national PDPs: AARP MedicareRx Saver Plus (27 percent), AARP MedicareRx Preferred (23 percent), Humana Preferred (14 percent), First Health Part D Value Plus (7 percent), and Humana Enhanced (7 percent) (Figure 17). For two of these five PDPs, the affected LIS beneficiaries are projected to pay substantial premiums in 2018: $50.73 per month for the AARP MedicareRx Preferred PDP, and $44.89 for Humana Enhanced. Because they are enhanced PDPs, LIS enrollees in these two plans will not be reassigned to a new plan by CMS, so they must select a different plan in order to avoid paying these premiums. Medicare Part D: A First Look at Prescription Drug Plans in 2018 12 Discussion This analysis of the Medicare Part D PDP landscape for 2018 shows a modest increase in plan availability for 2018, along with wide variation in premiums across plans. Premium variation for plans similar in design could be due to a number of factors related to differences in plan costs and different market strategies across plan sponsors. For example, plan costs are influenced by the generosity in formulary coverage, tier placement and rebates, deductibles and cost-sharing amounts, use of preferred pharmacy networks, the health risk of enrollees, and geographic area. There is some evidence that some of the most popular PDPs that charge lower premiums have relatively narrow formulary coverage compared to PDPs charging higher premiums. Part D sponsors may also launch new PDPs with premiums well below the average, at least initially, in order to attract new or current enrollees to gain market share. Part D plans vary in numerous ways that can have a significant effect on an enrollee’s out-of-pocket spending, including premiums, cost-sharing requirements, tier placement, the list of covered drugs, and preferred pharmacies. Although beneficiaries may focus on plan premiums as the primary measure of plan cost, an individual’s costs are also affected by the plan’s deductible, cost-sharing amounts, whether their current drugs are on formulary, and which pharmacy they use. A single drug on or off formulary may have a far larger effect on an enrollee’s total costs than the premiums or other plan design features. Some of these plan features are beyond the scope of this analysis, but they are critical for Medicare beneficiaries to consider when evaluating their Part D plan options. Beneficiaries have the opportunity to compare Part D plans each year during the open enrollment period, and in 2018 will have nearly two dozen plans from which to choose. The open enrollment period presents both opportunities and challenges for Medicare beneficiaries to compare and choose a plan that best meets their individual needs, though prior research shows a relatively small share do so. Finding ways to get more Part D enrollees engaged in comparing and reviewing plans and making changes that could save them money remains an ongoing challenge for CMS and policymakers. In 2018, some Part D enrollees who retain their current plans may see lower premiums and lower overall costs. But more enrollees will face higher premiums and deductibles if they remain in their current plans, and could also see changes in their plan’s formulary coverage and cost- sharing amounts for their drugs, which could also affect their total out-of-pocket costs. As in prior years, Part D enrollees are likely to benefit from the opportunity to shop during open enrollment. Juliette Cubanski, Tricia Neuman, and Kendal Orgera are with the Kaiser Family Foundation. Anthony Damico is an independent consultant. Jack Hoadley is Research Emeritus Professor at Georgetown University. Medicare Part D: A First Look at Prescription Drug Plans in 2018 13 Methods This analysis focuses on the Medicare Part D stand-alone prescription drug plan marketplace in 2018 and trends over time. The analysis includes 20.4 million enrollees in stand-alone PDPs, excluding 4.4 million enrollees in employer-group only PDPs for whom plan premium and benefits data are unavailable. Data on Part D plan availability, enrollment, and premiums were collected primarily from a set of data files released by the Centers for Medicare & Medicaid Services (CMS) on a regular basis:  Part D plan landscape files, released each fall prior to the annual enrollment period. These files include basic plan characteristics, such as plan names, premiums, deductibles, gap coverage, and benchmark plan status. For this analysis, we used the 2018 PDP Landscape Source files, v-09-22-17, released on September 29, 2017.  Part D plan and premium files, released each fall. These files include more detail on plan characteristics, including premiums charged to LIS beneficiaries, the portions of the premiums allocated to the basic and enhanced benefits, and the separate drug premiums for MA-PD plans.  Part D plan crosswalk files, released each fall. These files identify which plans are matched up when a plan sponsor changes its plan offerings from one year to the next.  Part D contract/plan/state/county level enrollment files, released on a monthly basis. These files include total enrollment by contract and plan at the state and county level. We use September 2017 enrollment counts for enrollment-weighted analysis in this report for 2017 and projected for 2018. Previous years’ data are based on March enrollment files for each year. Enrollment files suppress totals for plans with 10 or fewer enrollees.  Part D Low-Income Subsidy enrollment files, released once annually (in March for 2017). These files include total enrollment counts for LIS enrollees. As with the other enrollment files, we exclude plans with small enrollment counts in estimates that are plan-enrollment weighted.  Medicare plan benefit package files, released each fall. These files supply detailed information on the benefits offered by plans, including cost-sharing amounts for each formulary tier, tier labels, and the different cost-sharing amounts for standard and preferred cost-sharing pharmacies, where applicable.  Medicare penetration files, released on a monthly basis. These files are used to estimate average counts of plans available per beneficiary. This analysis adopts different methods with regard to the treatment of certain data elements than previously published analysis of the Part D marketplace conducted by the authors. Our previously published analysis used monthly enrollment files by plan rather than the contract/plan/state/county level enrollment files, and imputed a value of five enrollees for suppressed counts for plans with 10 or fewer enrollees (rather than excluding them, as we do in this analysis); for plan/county data, our prior analysis imputed a value of one beneficiary for all plan/county combinations for suppressed counts of 10 or fewer beneficiaries (rather than excluding them, as we do in this analysis). Medicare Part D: A First Look at Prescription Drug Plans in 2018 14 Appendix 1: Information about Medicare Part D Stand-alone Prescription Drug Plans (PDPs) Table A1: Number of Medicare Part D Stand-alone Prescription Drug Plans by State/Territory, 2006-2018 STATE/ 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 TERRITORY U.S. Total 1,429 1,866 1,824 1,687 1,576 1,007 1,041 1,031 1,169 1,001 886 746 782 Alabama 41 56 53 49 46 31 32 33 35 30 27 24 25 Alaska 27 45 47 45 41 26 25 23 28 24 19 18 19 Arizona 43 53 51 49 46 27 30 29 34 30 26 22 23 Arkansas 40 58 55 52 49 31 30 30 34 29 26 22 23 California 47 55 56 51 47 30 33 32 36 32 28 24 25 Colorado 43 55 55 53 48 28 28 29 34 30 26 23 24 Connecticut 44 51 51 47 48 31 30 30 33 27 26 21 22 Delaware 47 55 52 48 45 30 31 29 36 27 24 20 21 District of 47 55 52 48 45 30 31 29 36 27 24 20 21 Columbia Florida 43 57 58 54 49 29 33 34 35 27 22 20 21 Georgia 42 55 54 50 45 29 30 30 34 30 27 23 24 Hawaii 29 46 49 47 41 25 25 23 29 25 21 19 20 Idaho 44 56 54 51 48 32 33 32 37 31 28 24 25 Illinois 42 56 53 49 46 32 33 32 38 33 28 23 24 Indiana 42 53 52 48 44 29 31 31 35 31 28 23 24 Iowa 41 53 52 48 46 30 33 32 34 30 26 22 23 Kansas 40 53 52 48 46 30 31 30 33 29 25 22 23 Kentucky 42 53 52 48 44 29 31 31 35 31 28 23 24 Louisiana 39 52 50 47 45 29 30 30 33 28 25 20 21 Maine 41 53 53 46 43 27 28 28 32 28 27 23 24 Maryland 47 55 52 48 45 30 31 29 36 27 24 20 21 Massachusetts 44 51 51 47 48 31 30 30 33 27 26 21 22 Michigan 40 54 55 51 46 32 34 33 36 31 28 23 24 Minnesota 41 53 52 48 46 30 33 32 34 30 26 22 23 Mississippi 38 52 49 47 45 29 30 29 33 28 24 19 20 Missouri 41 53 52 48 45 29 30 31 35 31 28 23 24 Montana 41 53 52 48 46 30 33 32 34 30 26 22 23 Nebraska 41 53 52 48 46 30 33 32 34 30 26 22 23 Nevada 44 54 53 49 46 28 29 29 34 32 28 23 24 New Hampshire 41 53 53 46 43 27 28 28 32 28 27 23 24 New Jersey 44 57 57 52 47 30 30 29 34 29 25 21 22 New Mexico 43 57 55 50 47 29 30 30 36 31 27 23 24 New York 46 61 55 51 50 30 29 28 31 25 22 19 20 Medicare Part D: A First Look at Prescription Drug Plans in 2018 15 Table A1: Number of Medicare Part D Stand-alone Prescription Drug Plans by State/Territory, 2006-2018 STATE/ 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 TERRITORY North Carolina 38 51 52 49 47 30 30 30 34 29 26 22 24 North Dakota 41 53 52 48 46 30 33 32 34 30 26 22 23 Ohio 43 60 58 49 46 31 33 33 37 31 27 22 23 Oklahoma 42 56 52 49 46 30 30 30 36 31 27 22 23 Oregon 45 57 55 48 44 29 30 30 35 30 26 21 22 Pennsylvania 52 66 63 57 55 35 36 38 39 29 29 24 26 Rhode Island 44 51 51 47 48 31 30 30 33 27 26 21 22 South Carolina 45 59 56 51 47 31 32 31 35 31 27 21 22 South Dakota 41 53 52 48 46 30 33 32 34 30 26 22 23 Tennessee 41 56 53 49 46 31 32 33 35 30 27 24 25 Texas 47 60 56 53 50 30 33 32 36 32 28 23 24 Utah 44 56 54 51 48 32 33 32 37 31 28 24 25 Vermont 44 51 51 47 48 31 30 30 33 27 26 21 22 Virginia 41 53 52 48 44 29 30 31 35 31 28 23 24 Washington 45 57 55 48 44 29 30 30 35 30 26 21 22 West Virginia 52 66 63 57 55 35 36 38 39 29 29 24 26 Wisconsin 45 54 57 53 48 29 29 30 33 29 27 24 25 Wyoming 41 53 52 48 46 30 33 32 34 30 26 22 23 TERRITORY Territories Total 17 46 53 52 44 27 22 20 17 12 11 11 13 American Samoa 1 3 4 4 3 2 1 1 1 1 1 1 1 Guam 1 3 4 4 3 2 1 1 1 2 2 2 3 Northern Mariana 1 3 4 4 3 2 1 1 1 1 1 1 2 Islands Puerto Rico 10 28 34 33 29 17 16 16 13 7 6 6 6 Virgin Islands 4 6 7 7 6 4 3 1 1 1 1 1 1 NOTE: U.S. total count excludes PDPs in the territories. Totals include sanctioned plans closed to new enrollees as of September of prior year. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 Part D plan files. Medicare Part D: A First Look at Prescription Drug Plans in 2018 16 Table A2: Monthly Premiums for Medicare Part D Stand-alone Prescription Drug Plans by State, 2018 Weighted Average % Change, STATE/TERRITORY Minimum Premium Maximum Premium Premium 2017-2018 U.S. Total $12.60 $197.10 $43.48 9% Alabama $17.70 $124.70 $44.19 9% Alaska $20.40 $96.70 $40.29 7% Arizona $12.70 $96.90 $45.51 14% Arkansas $16.40 $112.80 $34.61 8% California $19.70 $169.80 $47.42 8% Colorado $20.40 $190.90 $44.67 17% Connecticut $12.60 $122.60 $42.79 7% Delaware $12.60 $92.60 $41.52 4% District of Columbia $12.60 $92.60 $41.52 4% Florida $17.70 $169.40 $47.55 12% Georgia $12.60 $181.20 $40.67 10% Hawaii $20.40 $96.80 $34.62 7% Idaho $20.40 $184.50 $44.94 13% Illinois $16.70 $180.30 $45.44 9% Indiana $17.70 $157.40 $41.00 9% Iowa $20.40 $100.60 $37.66 11% Kansas $20.40 $155.60 $42.55 11% Kentucky $17.70 $157.40 $41.00 9% Louisiana $17.70 $90.00 $38.50 8% Maine $12.60 $148.80 $44.77 14% Maryland $12.60 $92.60 $41.52 4% Massachusetts $12.60 $122.60 $42.79 7% Michigan $12.60 $102.60 $41.89 5% Minnesota $20.40 $100.60 $37.66 11% Mississippi $12.60 $96.70 $37.83 8% Missouri $20.40 $152.60 $41.51 12% Montana $20.40 $100.60 $37.66 11% Nebraska $20.40 $100.60 $37.66 11% Nevada $20.20 $171.30 $43.30 13% New Hampshire $12.60 $148.80 $44.77 14% New Jersey $19.70 $99.60 $49.34 1% New Mexico $17.40 $153.40 $35.31 17% New York $12.60 $91.20 $47.42 7% North Carolina $12.60 $115.70 $44.39 7% North Dakota $20.40 $100.60 $37.66 11% Ohio $12.60 $162.70 $41.53 11% Oklahoma $20.40 $178.20 $43.71 9% Medicare Part D: A First Look at Prescription Drug Plans in 2018 17 Table A2: Monthly Premiums for Medicare Part D Stand-alone Prescription Drug Plans by State, 2018 Weighted Average % Change, STATE/TERRITORY Minimum Premium Maximum Premium Premium 2017-2018 Oregon $12.60 $160.50 $41.90 14% Pennsylvania $12.60 $157.80 $43.95 11% Rhode Island $12.60 $122.60 $42.79 7% South Carolina $12.60 $138.10 $40.32 9% South Dakota $20.40 $100.60 $37.66 11% Tennessee $17.70 $124.70 $44.19 9% Texas $16.70 $197.10 $42.05 6% Utah $20.40 $184.50 $44.94 13% Vermont $12.60 $122.60 $42.79 7% Virginia $16.70 $158.80 $45.30 8% Washington $12.60 $160.50 $41.90 14% West Virginia $12.60 $157.80 $43.95 11% Wisconsin $19.70 $157.70 $44.82 9% Wyoming $20.40 $100.60 $37.66 11% NOTE: Average monthly premium is weighted by 2017 enrollments for the region in which the state is located. Terminated plans are excluded in calculation of premium change. SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2017-2018 Part D plan files. Medicare Part D: A First Look at Prescription Drug Plans in 2018 18 Table A3: Number of Medicare Part D Stand-alone Prescription Drug Plans Below Low- Income Subsidy Benchmark by State, 2006-2018 STATE 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 U.S. Total 408 642 495 308 307 315 327 331 352 283 218 231 216 Alabama 9 17 15 12 9 11 12 13 11 12 7 7 6 Alaska 8 17 15 7 6 5 4 7 11 7 6 5 7 Arizona 6 10 7 2 8 9 10 10 11 12 10 10 10 Arkansas 13 23 18 12 15 16 15 15 12 6 4 5 4 California 10 14 9 6 7 5 6 6 9 6 6 6 5 Colorado 10 19 12 8 6 7 5 4 5 7 6 7 6 Connecticut 11 20 14 12 13 11 10 6 8 5 6 7 7 Delaware 15 21 18 11 11 11 13 13 13 10 10 10 10 District of 15 21 18 11 11 11 13 13 13 10 10 10 10 Columbia Florida 6 10 8 5 5 4 3 2 5 4 3 3 2 Georgia 14 21 18 11 8 13 12 13 9 8 5 4 5 Hawaii 8 18 10 5 7 6 10 10 4 9 2 5 4 Idaho 14 20 14 9 9 11 12 10 13 12 9 9 8 Illinois 15 23 19 12 10 9 10 10 14 10 9 9 8 Indiana 13 19 17 12 9 13 13 11 15 10 7 7 7 Iowa 14 20 16 9 8 9 9 8 10 5 5 6 5 Kansas 11 20 17 10 9 11 10 10 13 7 4 5 4 Kentucky 13 19 17 12 9 13 13 11 15 10 7 7 7 Louisiana 11 12 10 7 13 10 12 14 14 11 7 7 6 Maine 14 21 18 5 4 7 8 10 7 9 9 8 7 Maryland 15 21 18 11 11 11 13 13 13 10 10 10 10 Massachusetts 11 20 14 12 13 11 10 6 8 5 7 7 7 Michigan 14 26 17 11 9 11 12 10 13 10 7 8 9 Minnesota 14 20 16 9 8 9 9 8 10 5 5 6 5 Mississippi 12 21 15 13 10 13 12 13 13 9 6 7 6 Missouri 9 15 13 6 13 5 8 8 8 6 4 4 4 Montana 14 20 16 9 8 9 9 8 10 5 5 6 5 Nebraska 14 20 16 9 8 9 9 8 10 5 5 6 5 Nevada 7 9 5 1 5 4 2 2 4 4 4 4 3 New Hampshire 14 21 18 5 4 7 8 10 7 9 9 8 7 New Jersey 14 20 18 7 6 6 9 10 12 10 8 8 7 New Mexico 8 14 11 7 8 8 6 7 7 7 8 9 7 New York 15 16 15 9 11 11 12 12 8 8 7 8 8 North Carolina 13 21 17 11 8 10 9 8 10 8 5 7 7 North Dakota 14 20 16 9 8 9 9 8 10 5 5 6 5 Ohio 10 22 15 6 5 7 8 8 12 8 5 6 6 Medicare Part D: A First Look at Prescription Drug Plans in 2018 19 Table A3: Number of Medicare Part D Stand-alone Prescription Drug Plans Below Low- Income Subsidy Benchmark by State, 2006-2018 STATE 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Oklahoma 12 20 13 8 10 9 9 11 12 10 6 7 7 Oregon 15 20 15 7 9 7 9 10 12 10 9 8 7 Pennsylvania 15 26 18 9 11 12 12 14 13 9 9 9 9 Rhode Island 11 20 14 12 13 11 10 6 8 5 6 7 7 South Carolina 16 26 20 15 13 14 12 14 8 7 4 6 4 South Dakota 14 20 16 9 8 9 9 8 10 5 5 6 5 Tennessee 9 17 15 12 9 11 12 13 11 12 7 7 6 Texas 16 19 15 14 11 11 13 12 11 10 7 6 7 Utah 14 20 14 9 9 11 12 10 13 12 9 9 8 Vermont 11 20 14 12 13 11 10 6 8 5 6 7 7 Virginia 16 21 17 13 11 10 10 10 13 9 7 7 6 Washington 15 20 15 7 9 7 9 10 12 10 9 8 7 West Virginia 15 26 18 9 11 12 12 14 13 9 9 9 9 Wisconsin 14 21 16 16 10 9 10 10 12 8 7 7 8 Wyoming 14 20 16 9 8 9 9 8 10 5 5 6 5 NOTE: Benchmark plans are not shown for the territories because low-income beneficiaries residing in the territories are not eligible for the low-income subsidy. Estimates in some years/states include “de minimis” plans, which can retain Low-Income Subsidy beneficiaries despite exceeding the benchmark premium by a minimal amount (up to $2 in 2018). SOURCE: Authors’ analysis of Centers for Medicare & Medicaid Services 2006-2018 Part D plan files. Medicare Part D: A First Look at Prescription Drug Plans in 2018 20 Appendix 2: Medicare Part D Standard Benefit Parameters, 2006-2018 $9,000 $8,418 $8,071 $8,000 Total Drug Spending at Catastrophic Coverage Threshold $7,515 $6,955 $7,062 $7,000 $6,730 $6,691 $6,440 $6,484 $6,154 $6,000 $5,726 Out-of-Pocket Threshold $5,451 $5,100 for Catastrophic Coverage $4,950 $5,000 $5,000 $4,550 $4,550 $4,700 $4,750 $4,550 $4,700 $4,850 $4,350 $4,050 $3,850 $3,700 $3,750 $4,000 $3,600 Initial Coverage Limit $3,310 $2,930 $2,970 $2,850 $2,960 $3,000 $2,700 $2,830 $2,840 $2,510 $2,250 $2,400 $2,000 Deductible $1,000 $250 $265 $275 $295 $310 $310 $320 $325 $310 $320 $360 $400 $405 $0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 NOTE: Where applicable, estimates are rounded to nearest whole dollar. SOURCE: Kaiser Family Foundation, based on Part D benefit parameters, 2006-2018. The Henry J. 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