Changes in out-of-pocket costs, new benefits and continued growth of Medicare Advantage plans are a few of the important trends to watch this fall, according to information recently released by medicareresources.org.
Medicare open enrollment began Oct. 15 and closes Dec. 7. It is the time when millions of Medicare enrollees can switch from Original Medicare to Medicare Advantage, or vice versa, and make changes to their Medicare Advantage or Part D prescription drug plans. This includes dropping or enrolling in a stand-alone Part D plan.
“There are some positive changes for beneficiaries in 2023, including lower-cost insulin and additional free vaccines,” said Louise Norris, a health policy analyst for medicareresources.org. “Consumers can also expect changes to cost sharing and premiums, which can impact their out-of-pocket costs.”
Here are four important things to know:
Insulin costs will be capped at $35 a month
There are 1.7 million Medicare Part D enrollees who use insulin who don’t receive low-income subsidies, and in 2020, they spent an average of $54 per prescription, though some paid over $100 a month.
But with the passage of the Inflation Reduction Act (IRA), which became law in August 2022, copays for insulin will be capped at $35 a month for all Part D plans.
“This is great news for people with diabetes,” Norris said. “This change will save some people with diabetes hundreds of dollars a year.”
Recommended vaccines will be free
Under current rules, only certain vaccines — COVID-19, flu, pneumonia, hepatitis B - are covered for free. But vaccines covered by Part D – including Tdap (tetanus, diphtheria, pertussis) and shingles vaccines – have cost-sharing that varies from one plan to another.
This means some Medicare beneficiaries can pay hundreds of dollars in out-of-pocket costs in order to get the vaccines that the CDC’s Advisory Committee on Immunization Practices (ACIP) recommends.
However, with the passage of the Inflation Reduction Act, Medicare Part D plans must cover ACIP-recommended vaccines without any cost-sharing, starting in 2023.
“This is huge for consumers, especially when it comes to the shingles vaccine,” said Jenny Chumbley Hogue, an analyst for medicareresources.org. “Right now, that can be more than $300 for the two recommended doses if you haven’t met your Part D deductible.”
Amid inflation, some costs will decrease
During this enrollment period, Medicare beneficiaries can expect changes to premiums, deductibles and copays. But for 2023, some of those costs will actually decrease.
The standard premium for Medicare Part B will decrease in 2023 to $164.90 a month, $5.20 lower than this year’s monthly premium. The annual deductible for Medicare Part B will also decrease in 2023 to $226, $7 lower than the annual deductible in 2022. The premium decrease is fueled by Medicare’s lower-than-expected spending on Aduhelm, the new Alzheimer’s drug that drove a significant portion of the Part B rate increase in 2022.
In addition, people could see around a 9 percent increase in their Social Security benefits, thanks to a historically large cost-of-living adjustment (COLA). And unlike 2022, when most recipients had to use a chunk of their COLA to cover the higher Part B premiums, the Part B premium will not increase in 2023. So the COLA will be available to use to cover other living expenses, which have increased sharply in 2022.
“Senior citizens, like everyone else, have seen their costs increase,” Norris said. “So higher Social Security benefits, combined with flat Part B premiums, would likely be very welcome news.”
Medicare Advantage enrollment expected to grow
More than 29 million people had Medicare Advantage plans in 2022. Enrollment in these plans has been steadily growing for more than 15 years, far outpacing overall Medicare enrollment growth. In 2004, just 13 percent of Medicare beneficiaries had Medicare Advantage plans. That had grown to more than 46 percent by 2022.
Medicare Advantage plans are popular because they can include significant savings on prescription drugs, as well as free benefits such as dental, hearing and vision coverage. But the plans also come with limitations that people should familiarize themselves with before signing up so they aren’t caught off guard after the coverage kicks in. For example, unlike Original Medicare, Medicare Advantage limits enrollees to a specific network of providers. And many Medicare Advantage plans include Part D drug coverage with formularies that change annually.
Medicareresources.org is one of the longest running sources of in-depth information about health insurance for consumers. The site provides an overview of the basics of Medicare coverage options, enrollment and eligibility; coverage FAQs; state-specific Medicare information; and a glossary of Medicare terms.
