On May 15, the initial open enrollment period for Medicare’s prescription drug program known as Medicare Part D ended. CMS reported a surge in enrollments before the open enrollment concluded. CMS also reported that the average Medicare Part D premium for 2006 is under $24 per month, significantly below the $36 benchmark price that CMS projected soon after the law was enacted.
Medicare Part D plans submitted their 2007 bids on June 5 (similar to FEHB plans which submitted their 2007 benefit and rate proposals on May 31). According to BNA, experts are predicting that 2007 Medicare Part D premiums will be 5% to 8% lower than 2006 premiums because the Medicare law provides for aggregate reinsurance to help Part D sponsors launch the new product. The thresholds for these “risk corridor” payments double in 2008 so plans may want to build enrollment in 2007. CMS is expected to announce the 2007 benchmark premium in August 2006.