Healthy Skepticism Library item: 1995

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Publication type: news

Hallam K.
Medicare Chief Says Drug Premium Will Average $32.20
Bloomberg 2005 Aug 9

Full text:

Medicare Chief Says Drug Premium Will Average $32.20 (Update1)
2005-08-09 14:54 (New York)

By Kristen Hallam Aug. 9 (Bloomberg) — Medicare chief Mark McClellan said that
monthly premiums for drug coverage will average $32.20, less than
the government had estimated in March, because of lower
prescription costs. McClellan gave the new estimate in a briefing today with
reporters in Washington. Medicare trustees, in their annual report
in March, estimated the premium would be $37.37. The drug benefit
will take effect Jan. 1 and will be operated by private
contractors including Aetna Inc. and UnitedHealth Group Inc. The lower-than-expected premiums are the result of insurance
companies’ ``effective’‘ negotiations with drug manufacturers and
efforts to promote the use of cheaper generic medicines, McClellan
said. It’s also possible that plans could charge no premium to
Medicare patients, McClellan said. ``Lower premiums should make the benefit more attractive to
more people,’‘ McClellan said at the briefing. The Centers for Medicare and Medicaid Services is still
negotiating with insurance companies and hasn’t yet approved any
bids for the drug-benefit business, McClellan said. As many as 30 million of Medicare’s 42 million elderly and
disabled enrollees will sign up for the drug coverage next year,
according to government estimates.

—Editor: Greene