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Big premium increases foreseen for Medicare drug plan

In this Nov. 17, 2015, photo, Sal Natale looks over a Medicare brochure at his home in Seminole, Fla. Rising drug costs are starting to hit Medicare's popular prescription drug program, with many senior citizens looking at double digit premium increases next year. Natale, a retired dentist, said prescription premiums for him and his wife are going up about 30 percent next year, and he doesn’t see a good alternative. "I’m just going to grin and bear and hope it starts moderating," Natale said. (AP Photo/Chris O'Meara)
In this Nov. 17, 2015, photo, Sal Natale looks over a Medicare brochure at his home in Seminole, Fla. Rising drug costs are starting to hit Medicare's popular prescription drug program, with many senior citizens looking at double digit premium increases next year. Natale, a retired dentist, said prescription premiums for him and his wife are going up about 30 percent next year, and he doesn’t see a good alternative. "I’m just going to grin and bear and hope it starts moderating," Natale said. (AP Photo/Chris O'Meara)

By Associated Press 5 min read

WASHINGTON (AP) – With time running out on open enrollment season, many seniors are facing sharply higher premiums for Medicare’s popular prescription drug program. The reason: rising drug costs have overtaken a long stretch of stable premiums.

Beneficiaries have until Dec. 7 to see if there’s a lower-cost plan that will cover their medications in 2016. Consumer advocates and experts say it will pay to shop around this sign-up season.

“Premiums are going up. Deductibles are going up,” said Tricia Neuman, a Medicare expert with the nonpartisan Kaiser Family Foundation. “There is some potential to save a lot of money by switching plans.”

Government spending on the program also has risen significantly, driven by pricey new drugs, notably for hepatitis C infection. The cost for the hepatitis drugs in the Medicare program is expected to be $9.2 billion this year, nearly doubling from 2014. Because of the prescription program’s financial structure, taxpayers cover most of the cost for expensive medications. Three out of four adults infected with hepatitis C are baby boomers, the group now entering Medicare.

Also known as “Part D,” Medicare’s prescription plan serves about 40 million older and disabled people. Benefits are provided through a variety of insurance arrangements. Stand-alone drug plans that work with traditional Medicare are the most popular, accounting for more than half of beneficiaries – about 24 million people.