On April 1, 2024, the Centers for Medicare & Medicaid Services (CMS) released its Announcement of Calendar Year (CY) 2025 Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies that would update program policies for Medicare Advantage and Medicare Part D beginning in 2025. CMS also issued its Final Calendar Year (CY) 2025 Part D Redesign Program Instructions which center on implementing provisions of the Inflation Reduction Act of 2022 (IRA) related to the Part D benefit for 2025. A press releaseand fact sheet for the Rate Announcement and fact sheet for the Part D Redesign were also released.
Changes include the following:
- Changes to Effective Growth Rate and benchmark rate for MA payments,
- Changes related to implementing the IRA Part D benefit redesign for 2025,
- Continued phase-in of MA risk adjustment methodology,
- Continued risk adjustment model for Program of All-Inclusive Care for the Elderly (PACE) Organizations,
- Changes to the Part D risk adjustment model including IRA-related changes,
- Continued End-Stage Renal Disease risk adjustment model,
- Continued frailty adjustment for PACE and changes to adjustments for Fully Integrated Dually Eligible (FIDE) SNPs,
- Adjustments to Fee-for-Service (FFS) per capita costs in Puerto Rico, and
- Consideration of feedback on MA star ratings measure concepts for future years.
CMS anticipates a 3.7%, or over $16 billion, increase in MA plan payments compared to last year.
CMS FINALIZES EFFECTIVE GROWTH RATE OF 2.33% AND BENCHMARK RATE DECREASE OF 0.16% IN CY 2025
The Effective Growth Rate reflects the current estimates of the growth rates of benchmarks utilized in determining payment for MA plans. Growth in Medicare Fee-For-Service (FFS) per capita costs, as assessed by the CMS Office of the Actuary, have been the main driver for these growth rates.
The growth rate estimates for 2025 incorporate a technical adjustment to the per capita cost calculations for indirect and direct medical education costs associated with services provided to MA enrollees. For CY 2025, CMS continues its phase-in of the technical adjustment outlined in the CY 2024 Rate Announcement, implementing 52% of the technical adjustment during CY 2025. This results in a growth rate of 2.33% in CY 2025, with a net impact of $8.8 billion.
The MA benchmark rate is the difference between CMS’s expected change in revenue, 3.7%, and the average risk score trend, 3.86%. Therefore, in CY 2025, there will be a 0.16% decrease, as proposed in the Advance Notice.
THROUGH PART D REDESIGN PROGRAM INSTRUCTIONS, CMS MAKES CHANGES TO IMPLEMENT PART D RELATED PROVISIONS REQUIRED UNDER THE INFLATION REDUCTION ACT OF 2022
The Inflation Reduction Act of 2022 (IRA) requires several changes to the Part D benefit. Key changes in the Part D Redesign Program Instructions are outlined below.
CMS Implements Part D Redesign Changes
For 2025, the IRA makes significant changes to the existing Part D benefit design:
- Reduction of the annual out-of-pocket (OOP) threshold to $2,000 and elimination of the coverage gap phase:
- With elimination of the coverage gap phase, the new benefit will have three phases instead of four: the deductible phase, the initial coverage phase, and the catastrophic phase.
- The annual OOP threshold will be set at $2,000 for CY 2025. After meeting such threshold, the enrollee will enter the catastrophic phase and will not have any cost-sharing for Part D drugs in the catastrophic phase.
- Sunsetting of the Coverage Gap Discount Program (CGDP) on January 1, 2025, and Establishment of the Discount Program: Participating manufacturers that enter into a Discount Program agreement will provide discounts on applicable drugs, typically 10% of the negotiated price for enrollees in the initial coverage phase and 20% of the negotiated price for enrollees in the catastrophic phase in CY 2025. An applicable drug is a drug approved under a New Drug Application or Biologics License Application other than a selected drug subject to drug price negotiation. Detailed information about the Discount Program is provided in the Medicare Part D Manufacturer Discount Program Final Guidance and Medicare Part D Manufacturer Discount Program: Methodology for Identifying Specified Manufacturers and Specified Small Manufacturers.
- Changes in the Part D Liability of Enrollees, Sponsors, Manufacturers, and CMS: The defined standard (DS) benefit for CY 2025 will consist of the following phases: the deductible phase, the initial coverage phase, and the catastrophic phase. These changes, effective January 1, 2025, apply to all Part D plans, including employer group waiver plans (EGWPs).
- Annual deductible phase: Enrollee pays 100 percent of their gross covered prescription drug costs (GCPDC) until the deductible is met.
- Initial coverage phase: Enrollee pays 25% coinsurance for covered Part D drugs. Sponsor typically pays 65% of the costs of applicable drugs and 75% of the costs of all other covered Part D drugs. The manufacturer, through the Discount Program, typically covers 10% of the costs of applicable drugs. This phase ends when the enrollee has reached the annual OOP spending threshold of $2,000.
- Catastrophic phase: Enrollee pays no cost-sharing for Part D drugs. Sponsors typically pay 60% of the costs of all covered Part D drugs. The manufacturer pays a discount, typically equal to 20%, for applicable drugs. CMS pays a reinsurance subsidy equal to 20% of the costs of applicable drugs, and equivalent to 40% of the costs of all other covered Part D drugs that are not applicable drugs.
Several commenters noted that certain aspects of the Part D redesign may increase plans’ financial liability, particularly for plans with beneficiaries taking high-cost drugs, and expressed concerns that plans may increase their use of utilization and formulary management tools in response to these changes. Some commenters suggested CMS strengthen its formulary review and oversight process, including specifically asking CMS to examine the formulary position of drugs in the Part D protected classes. In response, CMS noted that it maintains a clinical formulary review process, which includes review of formulary placement of drugs in the protected classes. CMS will also monitor year-over-year formulary and utilization management changes to assess whether the changes in liability may reduce access to medications.
Changes to Costs in True Out-of-Pocket Costs (TrOOP)
TrOOP is the portion of spending on covered Part D drugs made by the beneficiary or on their behalf by certain third parties that determines when a beneficiary enters the initial coverage phase, becomes an applicable beneficiary for the Discount Program, reaches the annual OOP threshold, and subsequently enters the catastrophic coverage phase.
The IRA changes the categories that count toward TrOOP spending specifically including payments for previously excluded supplemental benefits provided by Part D sponsors and Employer Group Waiver Plans (EGWPs) and excluding payments under the new Manufacturer Discount Program. CMS indicates that Part D sponsors must update their systems to ensure that TrOOP accumulators appropriately account for these costs in 2025 and plans to provide Prescription Drug Event (PDE) reporting instructions later in 2024 with additional examples to demonstrate how this policy should be implemented.
Revision of Regulatory Definition of Creditable Coverage
In alignment with the IRA, CMS revises its regulatory definition of creditable coverage at § 423.56(b) to reflect that discounts paid under the Manufacturer Discount Program are not included when determining actuarial value. In response to public comments, CMS will continue to permit use of the creditable coverage simplified determination methodology, without modification to the existing parameters, for CY 2025 for non-employer group waiver plans (EGWPs) group health plan sponsors not applying for the retiree drug subsidy under section 1860D-22(a) of the Act. CMS will re-evaluate the continued use of the existing simplified determination methodology or establish a revised one for CY 2026 in future guidance.
New Policy for Drugs Not Subject to Defined Standard Deductible
The IRA changes the defined standard benefit to exempt certain drugs (certain insulins and vaccines) from the deductible. TrOOP-eligible costs for drugs not subject to the defined standard (DS) deductible, specifically covered insulin products, as well as TrOOP-eligible costs for drugs not subject to a non-DS plan deductible or drugs subject to a reduced deductible under non-DS plans, all count towards a beneficiary’s satisfaction of the DS deductible.
For CY 2025, if a beneficiary has not satisfied their plan deductible but has incurred sufficient TrOOP-eligible costs to satisfy the defined standard deductible, they will be both an applicable beneficiary under the Discount Program and deemed to have satisfied their plan deductible which means manufacturer discounts would be available under the Discount Program. However, if the beneficiary satisfies the plan’s deductible or utilizes a drug not subject to the deductible but is not eligible for Discount Program discounts because they have not incurred TrOOP-eligible costs to satisfy the defined standard deductible amount, then the plan will be required to cover the portion of costs a manufacturer would have owed had Discount Program discounts begun.
Changes to Government Reinsurance Calculation Methodology
As the IRA changes the government reinsurance calculation methodology for CY 2025 to be dependent on drug type, CMS is required to revise its Direct and Indirect Remuneration (DIR) allocation methodology to correspondingly vary for different types of drugs in CY 2025. CMS will calculate the reinsurance subsidy separately for applicable and non-applicable drugs and allocate the share of DIR for applicable and non-applicable drugs based on their respective share of gross covered prescription drug costs that fall in the catastrophic phase.
Revisions to EGWP Prospective Reinsurance Amount Approach
According to CMS, because the Part D redesign reduces the reinsurance percentage in CY 2025, using the existing methodology for calculating prospective reinsurance payments would result in CMS prospectively paying significantly more for employer group waiver plans (EGWPs) than necessary for CY 2025. This would result in CMS needing to recover sizable funds from EGWPs during the Part D payment reconciliation process. Thus, for CY 2025, CMS is updating the methodology to ensure that Part D Calendar Year EGWPs are paid a more appropriate prospective reinsurance amount in CY 2025 and plans to use the weighted average of per-member-per-month (PMPM) prospective reinsurance amounts submitted by Part D sponsors for Enhanced Alternative (EA) plans as part of the Part D bid submissions for the payment year in question.
CMS will not have final reconciled CY 2025 reinsurance amounts, reflecting the new benefit and reinsurance percentages that would allow CMS to revert to the previous methodology, until at least CY 2028. CMS plans to make a determination regarding methodology and amount of prospective reinsurance payments for EGWP sponsors for plan years beyond CY 2025 at a later time. Given that the CY 2025 prospective reinsurance payment amount for Part D Calendar Year EGWPs will rely on CY 2025 bid submissions, CMS plans to announce the CY 2025 prospective reinsurance payment amount for Part D Calendar Year EGWPs with the annual release of the Part D National Average Monthly Bid Amount (NAMBA), Part D base beneficiary premium (BBP), and related Part D bid information in the summer of 2024.
Definition of EA Benefit Design
In CY 2025, the Part D benefit redesign provisions under the IRA limit the available options for sponsors to enhance their benefits to offer an EA plan to the following:
- Coverage of drugs that are specifically excluded from Part D drug coverage; and/or
- Any one or more of the following changes that increase the actuarial value of benefits above the actuarial value of the defined standard prescription drug coverage:
- Reduction (or elimination) of the defined standard deductible
- Reduction of cost-sharing in the initial coverage phase.
Given the limited Part D benefit redesign options for EA plan design, CMS reconsidered what constitutes a permissible EA benefit design and establishes a process for ensuring that individuals receive value relative to the defined standard benefit when they enroll in an EA plan. For CY 2025, CMS will use the Part D Out-of-Pocket Costs (OOPC) model to estimate the value of EA plans relative to the value of the defined standard benefit.
Specialty Tier Cost Sharing Thresholds
Following the release of the draft program instructions, CMS became aware that the initial coverage limit (ICL) method CMS uses to set the maximum allowable cost sharing for the specialty tier based on a plan’s deductible will no longer be valid. The purpose of this policy is to ensure a plan’s value is reflective of the DS benefit. Per regulation, a plan with the full DS deductible is limited to a 25 percent coinsurance on its specialty tier, but a plan that fully eliminates the deductible may go up to a 33 percent coinsurance.
In the final Program Instructions, CMS establishes a new methodology to determine the specialty tier coinsurance/deductible ranges to represent the effective coinsurance for a Part D beneficiary under the redesigned benefit, similar to the calculation used pre-IRA. The equation is shown below.[1] For Part D plans with the full deductible provided under the DS benefit, coinsurance is 25 percent, with effective coinsurance of 32.1 percent.
For CY 2025, sponsors may not charge a coinsurance for their specialty tier(s) that exceeds the thresholds established in Table 170: CY 2025 Specialty Tier Coinsurance Thresholds for the applicable deductible range in their approved Plan Benefit Package (PBP).
CMS TO CONTINUE PHASE-IN OF THE CMS-HCC RISK ADJUSTMENT MODEL WITH FULL IMPLEMENTATION BY 2026
In CY 2024, CMS introduced the CMS-HCC risk adjustment model, with plans to fully implement it by 2026. The model includes updates such as restructuring condition categories, using ICD-10 codes, and incorporating more recent data. For the 2024 payment year, risk scores were calculated as a blend of the 2020 CMS-HCC model and the updated 2024 model.
For 2025, CMS finalizes its proposal to continue the phase-in, with risk scores calculated as a blend of 33% from the 2020 model and 67% from the 2024 model. The MA risk score trend for 2025 was calculated by blending the trends from the 2020 and 2024 CMS-HCC models. The blended trend, at 3.86 percent, reflects the average change in population and coding practices across all MA plans, with variations possible among individual plans in terms of payment impacts.
The majority of commenters supported the continued implementation of the 2024 CMS-HCC model, citing its improvements to payment accuracy and program integrity, and its role in addressing excess payments to MA organizations. However, some suggested delaying its phase-in, while others expressed concerns about its effects on care delivery and quality, particularly for certain beneficiary populations, locations, and plan types. CMS asserts the updated model aims to ensure that MA payments more accurately reflect recent relative costs and adequately compensate plans for enrollees with complex health needs. For CY 2026, CMS expects that 100 percent of MA risk scores will be calculated using the updated model.
CMS TO CONTINUE USING 2017 CMS-HCC RISK ADJUSTMENT MODEL FOR PACE ORGANIZATIONS
For PACE organizations, CMS will continue to use the 2017 CMS-HCC risk adjustment model, as they have since the CY 2022 Rate Announcement. In response to comments asking the agency to transition to a CY 2024 CMS-HCC risk adjustment model, CMS indicates it cannot implement the 2024 CMS-HCC risk adjustment model for PACE at this time as PACE organizations do not submit complete encounter data. The Rate Announcement discusses rationale for the 2017 CMS-HCC model used for PACE on pages 81-82.
PART D RISK ADJUSTMENT MODEL UPDATED IN ALIGNMENT WITH IRA MANDATE
CMS finalizes revisions to the Part D risk adjustment model to align with the redesign of the Part D benefit as mandated by the IRA, including the increase in Part D plan liability given the $2,000 cap on annual out-of-pocket spending for CY 2025 and the introduction of the new Manufacturer Discount Program. These changes are directed to support plan sponsors in accurately formulating bids for the specified year. CMS also finalizes a Part D risk adjustment model based on 2021 diagnoses and 2022 expenditures for non-PACE organizations, and another model based on 2018 diagnoses and 2019 expenditures for PACE organizations.
Additionally, CMS finalizes updates to the normalization methodology to accommodate differences in risk score trends between Medicare Advantage prescription drug (MA-PD) plans and stand-alone prescription drug plans (PDP). For CY 2025, separate normalization factors will be calculated for MA-PD plans and PDPs using the established five-year linear slope methodology and average historical risk scores from 2018 through 2022 (excluding 2021 for non-PACE organizations) and from 2016 through 2020 for PACE organizations.
EXISTING END-STAGE RENAL DISEASE RISK ADJUSTMENT MODELS MAINTAINED FOR CY 2025
For CY 2025, CMS will maintain separate End-Stage Renal Disease (ESRD) risk adjustment models for MA plans and PACE organizations. MA plans will continue using the 2023 ESRD risk adjustment models, detailed in the CY 2023 Advance Notice, for beneficiaries in dialysis, transplant, and post-graft status. PACE organizations will continue to use the 2019 ESRD risk adjustment models, outlined in the CY 2019 Advance Notice, for calculating ESRD risk scores for PACE participants.
Several commenters expressed concern about the use of the CY 2023 CMS-HCC ESRD model for MA plans for 2025. Commenters noted that while CMS updated the Part D model to accommodate the transition of oral-only ESRD drugs, such as phosphate binders, to Part B, it did not adjust for ESRD bundled costs. Commenters urged CMS policy teams to coordinate efforts regarding the timeline and execution of integrating oral-only drugs into the ESRD PPS bundled payment. They suggested that when this transition takes place, CMS should also revise the ESRD risk adjustment models to include the costs of phosphate binders. Other commenters expressed worry that the ESRD model inadequately reflects the high costs faced by MA plans in caring for ESRD enrollees, urging CMS to revise the model to ensure adequate MA payments for access to care. CMS states it will continue to evaluate the ESRD risk adjustment model in the future.
CMS CONTINUES CURRENT FRAILTY ADJUSTMENT APPROACH FOR PACE, BUT CHANGES MADE TO FIDE-SNPS
CMS utilizes a frailty adjustment for PACE organizations and Fully Integrated Dually Eligible (FIDE) SNPs to better predict Medicare expenditure for frail community populations whose functional impairments are unexplained by the CMS-HCC model. CMS is statutorily required to consider frailty when establishing capitated payments for PACE organizations and is allowed to adjust for frailty in FIDE SNPs that display similar frailty to that that seen in the PACE program.
For CY 2025, PACE organizations’ frailty factors will continue to be calculated using the 2017 CMS-HCC model.
However, for CY 2025, frailty factors will be blended for FIDE SNPs using a combination of 2020 and 2024 CMS-HCC model frailty factors. This blend will consist of 33 percent from the 2020 CMS-HCC model and 67 percent from the 2024 model.
In plan year 2025, FIDE SNPs will only be able to enroll full-benefit dual eligibles who are enrolled in an affiliated MCO, meaning that frailty factors calculated for non-dual or partial-benefit dual eligibles will not be applicable starting with that year. CMS calculates frailty scores using data from the previous year, so the 2025 scores are calculated using 2024 data, which would include beneficiaries who would not qualify for FIDE SNP enrollment in 2025.
Accordingly, to align with the “exclusively aligned enrollment” requirement going into effect in plan year 2025, CMS is finalizing their proposal that, exclusively for CY 2025, CMS will use full Medicaid frailty factors to calculate FIDE SNP frailty scores, irrespective of respondents’ 2024 Medicaid status. This methodology will also be applied to estimating the PACE minimum frailty score that CMS uses as the threshold to determine if a FIDE SNP is eligible for a frailty adjustment.
CMS estimates that the shift in the HCC model blend and the policy of calculating scores using only full Medicaid frailty factors will increase frailty scores by 1.9 percent relative to CY 2024.
CMS TO CONTINUE ADJUSTING FFS PER CAPITA COSTS IN PUERTO RICO
In Puerto Rico, a significantly larger proportion of Medicare beneficiaries receive benefits through MA rather than FFS compared to other states and territories. To maintain stability for the MA program in Puerto Rico and ensure the well-being of Puerto Ricans enrolled in MA plans, CMS will continue to set MA county rates in Puerto Rico based on the relatively higher costs of individuals in FFS with both Medicare Parts A and B. Additionally, CMS will implement an adjustment concerning individuals with zero claims.
CMS acknowledges feedback received on potential alternate adjustments specific to Puerto Rico and concerns regarding healthcare access for U.S. citizens in Puerto Rico. CMS will continue to evaluate these issues raised by stakeholders.
CMS CONSIDERS FEEDBACK ON STAR RATINGS MEASURE CONCEPTS FOR FUTURE YEARS
Star Ratings are a quality rating system for Medicare Advantage (Part C) and Medicare Part D prescription drug plans. These ratings are released annually and consist of a one-to-five-point scale (with five indicating excellent performance). Measures used to calculate 2025 Star Ratings are included in Table VI-1 of the Rate Announcement[2].
CMS is implementing a “Universal Foundation” of quality measures, which will create a core set of measures that are aligned across programs. CMS is working to include all of the Universal Foundation measures into the Part C and Part D Ratings, pending future rulemaking. Part C Star Rating measures that are currently part of the Universal Foundation are: Breast Cancer Screening, Colorectal Cancer Screening, Controlling Blood Pressure, Diabetes Care – Blood Sugar Controlled, Plan All-Cause Readmissions, and CAHPS Overall Rating measures.
Key updates include changes to measure specifications for several measures, the retirement of the display measure Antidepressant Medication Management (Part C) from the 2026 display page, the potential retirement of the display measure Use of Opioid from Multiple Providers in Persons Without Cancer (OMP) (Part D) from the 2027 display page pending a vote from the Pharmacy Quality Alliance (PQA) membership that is expected to occur this year, and potential new measure concepts and methodological changes in future years.
New measures CMS is continuing to consider for future years include:
- Blood Pressure Control for Patients with Hypertension (Part C);
- Breast Cancer Screening Follow-Up (Part C) (two measures);
- Tobacco Use Screening and Cessation and Lung Cancer Screening and Follow-Up (Part C) (two measures);
- Functional Status Assessment Follow-Up; and
- Medicare Plan Finder Drug Pricing Measure (Part D).
In the Advance Notice, CMS also considered the Social Connection Screening and Intervention (Part C) measure and the Chronic Pain Assessment and Follow-Up (Part C) measure, but the National Committee for Quality Assurance (NCQA) has since paused the development of these measures. CMS has shared stakeholder feedback on all the potential measures with the National Committee for Quality Assurance (NCQA) to inform their measure development work.
In the Advance Notice, CMS specifically requested feedback on the potential new Medicare Plan Finder Drug Pricing measure for the Part D Star Ratings, noting limitations of the current Medicare Plan Finder Price Accuracy measure that is part of the Part C and D Star Ratings, including concerns that plans may be submitting artificially lower or high prices for the Medicare Plan Finder during the Annual Enrollment Period (AEP). This measure would evaluate the accuracy of plan sponsors’ pricing data that is displayed on the Medicare Plan Finder Tool and aims to gauge whether plan sponsors are substantially increasing or decreasing drug prices on Medicare Plan Finder after AEP. CMS sought initial feedback on the general measure concept and on specific concepts related to the measure, including on how CMS should calculate and compare a drug’s price during AEP and during the plan year, whether it is more important that AEP prices are stable or reliable, and how CMS should account for industry-wide price changes.[3] Commenters had mixed support on the general measure concept, with supporters agreeing that it is important for Medicare beneficiaries to have accurate Medicare Plan Finder data. Stakeholders opposed to the measure suggested that market fluctuations outside of plan control may result in drug price volatility. CMS continues to consider the development of Medicare Plan Finder pricing data analyses and performance measures. If this measure were to be added to the Star Ratings, it would go through the Pre-Rulemaking Measure Review process before potentially being proposed for addition to the Star Ratings in future rulemaking.
In the Advance Notice, CMS considered changes to the Health Outcomes Survey measure, including changes to better measure and address health equity. CMS is seeking OMB approval to conduct a field test of potential new survey items for this measure, including Patient-Reported Outcomes Measurement (PROMIS) Physical Function items, Generalized Anxiety Disorder 2 (GAD-2) items, and Health-Related Social Needs (HRSN) items. Most commenters appreciated CMS’s efforts in this area, though some commenters noted overlap between potential survey items and concerns about data reliability. CMS plans to share field test results when they are available.
CMS FINALIZES PART D BENEFIT PARAMETERS FOR THE 2025 PLAN YEAR AS PROPOSED
CMS updates the Medicare Part D benefit parameters for the defined standard drug benefit on an annual basis. Given IRA changes for CY 2025, only the defined standard benefit and low-income subsidy (LIS) benefit parameters have been updated by the methodology provided under the Social Security Act. The IRA set the annual out-of-pocket threshold at $2,000 for CY 2025. Additionally, under the IRA, beneficiaries who were previously eligible for the partial LIS benefit will now be eligible for the full LIS benefit in CY 2025. Lastly, parameters for maximum or minimum beneficiary cost-sharing in the coverage gap or above the annual out-of-pocket threshold did not need to be updated for CY 2025, as the coverage gap phase and beneficiary cost-sharing above the annual out-of-pocket threshold have been eliminated.
| Standard Benefit | 2024 | 2025 |
| Deductible
Beneficiary is responsible for 100% of drug costs. |
$545 | $590 |
| Initial Coverage Limit
Beneficiary is responsible for 25% of drug costs in the initial coverage phase. The Coverage Gap Discount Program sunsets effective January 1, 2025, and will be replaced with the Manufacturer Discount Program. Plans will be responsible for 65% of the cost of applicable drugs and 75% of the cost for non-applicable drugs. For applicable drugs, manufacturers will be responsible for 10% of the cost. An applicable drug is a drug approved under a New Drug Application or Biologics License Application. |
$5,030 | Eliminated for 2025 as the coverage gap phase is eliminated. The initial coverage phase will extend to the maximum out-of-pocket threshold of $2,000. |
| Out-of-Pocket Threshold
Beneficiary does not have cost-sharing after out-of-pocket spending reaches $2,000. The Coverage Gap Discount Program sunsets effective January 1, 2025, and will be replaced with the Manufacturer Discount Program. For applicable drugs, plans will be responsible for 60% of drug costs, Medicare will be responsible for 20%, and manufacturers will be responsible for 20%. For non-applicable drugs, plans will be responsible for 60% of drug costs and Medicare will be responsible for 40%. An applicable drug is a drug approved under a New Drug Application or Biologics License Application other than a selected drug subject to drug price negotiation. |
$8,000 | $2,000
Statutorily set under the IRA. |
| Maximum Copayments for Non-Institutionalized Dual Eligibles | ||
| Full Subsidy-Full Benefit Dual Eligible (FBDE) Beneficiaries
Up to 100% of federal poverty level (FPL)
|
$1.55 $4.60 |
$1.60 $4.80 |
| Full Subsidy-FBDE Beneficiaries
Between 100% and 150% of FPL
|
$4.50 $11.20 |
$4.90 $12.15 |
| Full Subsidy-Non-FBDE Beneficiaries
Applied or eligible for QMB/SLMB/QI or SSI, income at or below 150 % FPL for 2024 and resources ≤ $15,720 (individuals, 2024) or ≤ $31,360 (couples, 2024)
|
$4.50 $11.20 |
$4.90 $12.15 |
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This Applied Policy® Summary was prepared by Stephanie Lomas with support from the Applied Policy team of health policy experts. If you have any questions or need more information, please contact Stephanie Lomas at slomas@appliedpolicy.com or at 202-558-5272.
[1] See page 67 of the Final Program Instructions for the equation and results of this methodology at various deductible ranges.
[2] See pages 129-133 of the Rate Announcement.
[3] See pages 160 and 161 for specific areas where CMS sought feedback.