Despite the high cost of specialty drugs driving up expenditures, Medicare Part D prescription drug plan premiums are projected to rise by only about $1.50 over the average premium last year, the Centers for Medicare and Medicaid Services announced Friday.
The average basic premium of $34 a month compares to $32.56 in 2016, CMS said.
This is despite Medicare Part D expenditures per enrollee being estimated to increase by an average of 5.8 percent annually through 2025, higher than the combined per-enrollee growth rate for Medicare Parts A and B, at 4 percent, CMS said.
Growth in the costs of prescription drugs paid by Medicare continue to exceed growth in other Medicare costs and overall health expenditures.
[Also: Brand name drugs jack up Medicare Part D co-pays by factor of 10, study shows]
A 2016 Medicare Trustees report found costs are trending higher than previously predicted, particularly for specialty drugs and in the catastrophic benefit phase. A March 2016 Department of Health and Human Services report showed an analysis of high-cost prescription drug spending trends.
Although private prescription drug plans receive capitated payments for portions of the Part D benefit, Medicare is directly responsible for 80 percent of the cost of drugs purchased by beneficiaries while in the catastrophic benefit phase, CMS said.
The projection for the average premium for 2017 is based on bids submitted by drug and health plans for basic drug coverage for the 2017 benefit year and calculated by the independent CMS Office of the Actuary.
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Seniors and people with disabilities are continuing to see savings on out-of-pocket drug costs as the Affordable Care Act closes the Medicare Part D "donut hole" over time, CMS said.
The upcoming annual Medicare open enrollment period begins October 15 and ends on December 7, 2016. CMS anticipates releasing the premiums and costs for Medicare health and drug plans for the 2017 calendar year in mid-September.
"Stable Medicare prescription drug plan premiums help seniors and people with disabilities afford their prescription drugs," said Andy Slavitt, acting administrator of CMS. "However, I remain increasingly concerned about the rising cost of drugs, especially high-cost specialty drugs, and the impact of these costs on the Medicare program."
Twitter: @SusanJMorse