Medicare Premiums Drop – Competition Is Working

Medicare Premiums Drop - Competition Is Working

The New Medicare Drug Benefit: High Enrollment, Lower Costs

WASHINGTON - Yesterday, the Centers for Medicare & Medicaid Services (CMS) announced that beneficiaries enrolled in the new Medicare prescription drug benefit will have substantially lower premiums than previously estimated.

Premiums for beneficiaries are expected to average $25 per month - down from last year's projected $37 per month. As a result, the overall cost of the program to taxpayers in 2006 will drop 20 percent from the estimates in July 2005.

"When Congress structured this program in 2003, we designed it to utilize competition in driving down the costs to beneficiaries and taxpayers," said Ways and Means Committee Chairman Bill Thomas (R-CA). "Competition for millions of beneficiaries has produced lower costs - to both beneficiaries and taxpayers."

"Some want to use politics to deride the program or to argue the government should negotiate drug prices," added Thomas. "We know if the government gets into seniors' medicine cabinets, fewer drugs will be available to seniors. Competition works."

Participation in the program has been very strong since enrollment began on November 15, 2005. As of last month, 21 million beneficiaries are receiving their prescription drugs through Medicare. Nearly four million of those signed up for the stand-alone Medicare drug plan.

http://waysandmeans.house.gov/News.asp?FormMode=release&ID=374