March 7, 2014
Major findings from the new Oliver Wyman report include:
- As of February 2014, more than 75% of PDP enrollees are in plans with preferred pharmacy networks and these enrollees could be adversely affected by the elimination of plans utilizing preferred pharmacy networks.
- The estimated average increase in premiums for the affected population is $63 per year for the 2015 plan year.
- PDP enrollees may pay an average of $80 to $100 per year in additional cost-sharing in 2015.
- As a result of an expected increase in the national average benchmark for Part D plans, we estimate that CMS would pay an additional $64 in direct subsidies per beneficiary per year in 2015, for a total increased payment of nearly $1.5 billion in 2015 across all PDP enrollees, based on Part D enrollment of approximately 23 million beneficiaries.
- Over a 10-year period, the increased cost of eliminating preferred pharmacy networks is estimated to be approximately $990 per affected enrollee, and the cost would be approximately $24 billion to CMS in the form of higher direct subsidy payments.