The new year rings in more Rx drug savings, higher Part B premiums and new Advantage rules
What’s new for Medicare beneficiaries in 2024? A lot — including changes that expand care and make coverage more affordable.
For starters, Medicare’s more than 65 million enrollees will continue to feel the positive effects of 2022’s historic drug law aimed at curbing what older Americans pay for prescription medications. At the same time, beneficiaries will face higher premiums and deductibles for their medical care.
The face of Medicare continues to shift as an increasing number of people (more than 50 percent) are enrolled in Medicare Advantage (MA), the private insurance alternative to original Medicare. With the increase in popularity of MA plans will come new requirements on those insurers, including added behavioral health coverage, a standard commission that brokers and insurance agents get for signing people up for an MA plan, and a mandate that plans let consumers know midyear what extra benefits they are still entitled to use.
Also in 2024, the Centers for Medicare & Medicaid Services (CMS), the agency that runs Medicare, will continue its efforts to better coordinate the care that original Medicare enrollees receive.
“I think there are some pretty big changes to Medicare to really make care more affordable and accessible,” Meena Seshamani, a surgeon, health economist and director of the federal Center for Medicare, told AARP in an interview. “And that’s coupled with changes that we’re making to the program to make sure that people are taken care of as real people.” Seshamani reiterated the agency’s goal of by 2030 having all Medicare beneficiaries enrolled in organizations that coordinate the quality and cost of all their care. Those organizations include the growing number of accountable care organizations (ACOs) that coordinate Medicare beneficiaries’ care.
“When people have a serious illness, it can be really daunting to navigate all of the doctors and the prescriptions and the lab tests and imaging,” Seshamani says. To help providers better coordinate such care, beginning in 2024 Medicare will reimburse providers for helping patients navigate their health care, especially when facing a complicated illness. This change, Seshamani says, will help keep people healthy and save Medicare money. Medicare will also begin paying providers to train family caregivers to better help their loved ones.
Seshamani also pointed out ways beneficiaries will be able to spend less on their health care to help offset higher premiums. “There are changes that are coming in 2024 that people will feel in their pocket with the changes in the drug law,” she says. These include expanded eligibility for the Extra Help program, which helps beneficiaries with low incomes afford their prescription drugs. The new law in 2024 also places limits on how much enrollees with high medication costs will have to pay out of pocket.
Here’s a closer look at how Medicare is changing in 2024:
Premiums and deductibles
Part A: Most Medicare enrollees do not pay a monthly premium for Part A, which covers inpatient hospital, skilled nursing facility, hospice and some home health care services. If you haven’t worked long enough to qualify for premium-free Part A, that monthly premium is little changed. The full Part A premium will be $505 a month, a $1 decrease from 2023.
For 2024, the Part A deductible will be $1,632 per stay, an increase of $32 from 2023. Beneficiaries with Medicare Advantage plans should check with their insurer for hospital charges.
Part B: The standard monthly Part B premium is rising by almost $10 — from $164.90 to $174.70. Most Medicare beneficiaries have this premium deducted from their Social Security benefits. The average monthly Social Security payment will increase by $59 a month in 2024, thanks to a 3.2 percent Social Security cost-of-living increase (COLA). That COLA will more than cover the added Part B monthly premium for most beneficiaries.
The face of Medicare continues to shift as an increasing number of people (more than 50 percent) are enrolled in Medicare Advantage (MA), the private insurance alternative to original Medicare. With the increase in popularity of MA plans will come new requirements on those insurers, including added behavioral health coverage, a standard commission that brokers and insurance agents get for signing people up for an MA plan, and a mandate that plans let consumers know midyear what extra benefits they are still entitled to use.
Also in 2024, the Centers for Medicare & Medicaid Services (CMS), the agency that runs Medicare, will continue its efforts to better coordinate the care that original Medicare enrollees receive.
“I think there are some pretty big changes to Medicare to really make care more affordable and accessible,” Meena Seshamani, a surgeon, health economist and director of the federal Center for Medicare, told AARP in an interview. “And that’s coupled with changes that we’re making to the program to make sure that people are taken care of as real people.” Seshamani reiterated the agency’s goal of by 2030 having all Medicare beneficiaries enrolled in organizations that coordinate the quality and cost of all their care. Those organizations include the growing number of accountable care organizations (ACOs) that coordinate Medicare beneficiaries’ care.
“When people have a serious illness, it can be really daunting to navigate all of the doctors and the prescriptions and the lab tests and imaging,” Seshamani says. To help providers better coordinate such care, beginning in 2024 Medicare will reimburse providers for helping patients navigate their health care, especially when facing a complicated illness. This change, Seshamani says, will help keep people healthy and save Medicare money. Medicare will also begin paying providers to train family caregivers to better help their loved ones.
Seshamani also pointed out ways beneficiaries will be able to spend less on their health care to help offset higher premiums. “There are changes that are coming in 2024 that people will feel in their pocket with the changes in the drug law,” she says. These include expanded eligibility for the Extra Help program, which helps beneficiaries with low incomes afford their prescription drugs. The new law in 2024 also places limits on how much enrollees with high medication costs will have to pay out of pocket.
Here’s a closer look at how Medicare is changing in 2024:
Premiums and deductibles
Part A: Most Medicare enrollees do not pay a monthly premium for Part A, which covers inpatient hospital, skilled nursing facility, hospice and some home health care services. If you haven’t worked long enough to qualify for premium-free Part A, that monthly premium is little changed. The full Part A premium will be $505 a month, a $1 decrease from 2023.
For 2024, the Part A deductible will be $1,632 per stay, an increase of $32 from 2023. Beneficiaries with Medicare Advantage plans should check with their insurer for hospital charges.
Part B: The standard monthly Part B premium is rising by almost $10 — from $164.90 to $174.70. Most Medicare beneficiaries have this premium deducted from their Social Security benefits. The average monthly Social Security payment will increase by $59 a month in 2024, thanks to a 3.2 percent Social Security cost-of-living increase (COLA). That COLA will more than cover the added Part B monthly premium for most beneficiaries.
Prescription drugs
Catastrophic cap: Under the new drug law, Medicare Part D plan members whose prescription costs are so high that they enter what’s called the catastrophic phase of coverage will not have any more out-of-pocket costs for the rest of the year once they’ve spent $8,000 on their medications. In 2025, an annual $2,000 out-of-pocket cap on Part D spending will take effect.
Extra Help: In 2024 the new drug law is expanding the eligibility for the Extra Help program, which assists people with limited incomes in affording their prescription drug costs, such as premiums and copays. The income threshold for Medicare enrollees to qualify for that program will be 150 percent of the federal poverty level ($21,870 for an individual in 2024), up from 135 percent of poverty.
“It’s really important for people to see if they could qualify for that program,” Seshamani says, “because we estimate there are about 3 million people out there who are eligible and not enrolled.” Medicare beneficiaries can apply for the Extra Help program through the Social Security Administration.
New law provisions still on track: The provisions of the new prescription drug law that took effect in 2023 will still be in place in 2024. These include:
- A $35 cap on a 30-day supply of any insulin that Medicare covers, whether you have prescription drug coverage through a stand-alone Part D plan or your medications are covered under your Medicare Advantage plan.
- Vaccines recommended for adults by the Centers for Disease Control and Prevention’s Advisory Committee on Immunization Practices (ACIP) continue to be covered with no out-of-pocket costs. Included are the vaccines for shingles and RSV. Medicare also covers vaccines for flu, COVID-19, pneumonia, hepatitis A, rabies and tetanus.
- Drugmakers that raise their prices more than the rate of general inflation will continue to have to pay a rebate to Medicare. In 2023, 64 drugs were subject to that rebate.
- For the first time in history, Medicare is in the process of negotiating with drugmakers over the price of their products. Under the new drug law, the first 10 drugs that are being negotiated were identified in September, and by September 2024 CMS will publish the list of what the maximum fair prices will be for those medications.
More Medicare Advantage changes
Commissions: Under a proposed regulation, expected to take effect in 2024, broker and insurance agent commissions for the sale of a Medicare Advantage plan would be set at a flat $642. Currently there is a $611 cap on such payments, but those commissions are not fixed. CMS officials say the variation in these payments can lead to consumers not getting the best prices because some brokers may be inclined to push consumers toward MA plans paying higher commissions.
Seshamani says CMS wants to make sure that those who sell MA policies to people in Medicare are giving them the information they need to make the best decision, “not steering people towards a plan that is giving a super-high commission.”
Behavioral health
Beginning Jan. 1, licensed marriage and family therapists as well as mental health counselors, including addiction counselors, will be able to enroll in the Medicare program so they can be paid for treating Medicare enrollees.
Seshamani says about 400,000 clinicians will qualify to see Medicare patients. In addition, a proposed CMS regulation would add a new coverage category for MA plans called outpatient behavioral health, and those providers would be included in that category.
Extra benefits
Most Medicare Advantage plans offer extra benefits beyond what the law requires. Most often these include some dental, vision and hearing coverage; sometimes gym memberships, transportation to doctors’ offices, accessibility improvements to homes or even meals delivered to homes are included as well.
CMS officials say that often Medicare enrollees don’t take full advantage of some of these extras and may not even realize they are entitled to them.
Under a proposed regulation, expected to be finalized in 2024, halfway through the year, insurers will have to send a letter to enrollees letting them know what services they are entitled to but have yet to begin using.
https://www.aarp.org/health/medicare-insurance/info-2023/future-medicare-changes.html
