Facilities for Medicare & Medicaid Companies Releases Evaluation on 2022 Medicare Half B Premium Reexamination
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May 29, 2022 – Last Friday, the Centers for Medicare & Medicaid Services (CMS) released a report recommending that cost savings from lower-than-expected Medicare Part B spending be passed on to those with Medicare Part B coverage when calculating 2023 Part B Premium. Earlier this year, Department of Health (HHS) Secretary Xavier Becerra directed CMS to reassess the 2022 Part B premium amount in response to a price reduction for Aduhelm™, an anti-amyloid-directed monoclonal antibody used to treat Alzheimer’s disease. Based on the information available today, the premium is expected to be lower in 2023 than in 2022. The final determination will be made later this fall.
“At the direction of the Secretary, CMS has reevaluated the Medicare Part B premium and recommends that the savings identified be included in the Medicare Part B premium for 2023,” said CMS Administrator Chiquita Brooks-LaSure. “Due to changes in the cost of Aduhelm™ and coverage since the inception of the award, CMS recommends that the lower than expected expenses in 2022 be included in the 2023 Part B award determination. The Biden-Harris administration remains committed to reducing healthcare costs for beneficiaries by increasing pricing transparency, lowering prescription drug costs and connecting people to savings programs.”
Medicare Part B includes medical services, outpatient hospital services, certain home health services, durable medical devices, and certain other medical and health services not covered by Medicare Part A that include inpatient hospital care, skilled nursing facilities, hospices, laboratory testing, surgery, home nursing care.
As detailed in the report, CMS makes a provision when calculating the Part B premium to ensure that the Medicare Supplementary Medical Insurance (SMI) trust remains adequately funded for the year. In 2022, CMS built an appropriate reserve to ensure the SMI Trust Fund could cover potential costs of Aduhelm™ and related drugs. When CMS announced the fall 2021 premium, Aduhelm™ cost an average of $56,000 per year and CMS had not yet issued a National Coverage Determination (NCD). After the 2022 Medicare Part B premium was set, the maker of Aduhelm™ reduced the price to an average of $26,200, and CMS closed Medicare coverage with evidence development for Aduhelm™ and similar future FDA-approved drugs with an indication for the treatment of Alzheimer’s disease. CMS has determined that including these savings in the calculation of the 2023 Medicare Part B premium is the most effective way to return these savings to individuals on Medicare Part B. CMS is evaluating other current and projected Medicare Part B costs to inform the premium recommendation for 2023, which will be announced in accordance with statutory process in fall 2022.
In November 2021, CMS announced that the standard Part B monthly premium increased from $148.50 in 2021 to $170.10 in 2022. This increase was partly due to the legal requirement to prepare for potential expenses, such as pricing and usage of Aduhelm™. Despite the increase, most people on Medicare experienced a significant net increase in Social Security benefits due to an above average cost of living adjustment (COLA) in 2022.
Individuals with Medicare coverage may be eligible for help paying their Medicare expenses through the Medicare Savings Programs (MSP). CMS encourages people on Medicare to evaluate their eligibility to receive financial assistance from MSPs because they can also help pay Medicare Part A (hospital care) and Medicare Part B (health insurance) deductibles, coinsurance, and co-payments if individuals meet eligibility criteria fulfill. People on Medicare can learn more about the Medicare savings programs by calling 1-800-MEDICARE or Medicare.gov at https://www.medicare.gov/your-medicare-costs/get-help-paying-costs/medicare – to visit. austerity programs.
The 2022 Medicare Part B Premium Reexamination Report and Analysis is available at www.cms.gov/files/document/cms-report-secretary-2022-medicare-part-b-premium-reexamination.pdf.