Medicare Beneficiaries To See Part D Premium Hikes
Medicare enrollees in standalone Part D plans (PDPs) will see premium hikes in 2026. Premium hikes could be up to $50, although most will see something less. Increases might also hit those who enroll in a Medicare Advantage (MA) Part D.
The premium hikes occurred in 2025 and to a lesser degree in 2024. Spikes will be higher in 2026. The reason for the premium hikes include:
- Major drug price and utilization increases. One example is the uptake of GLP-1 weight-loss drugs used for those with chronic conditions like diabetes and cardiovascular disease.
- Changes in the Inflation Reduction Act (IRA) that limited cost-sharing in the program in a number of ways. A portion of the cost-sharing reductions were not funded and the costs and increased risk were put on plans. They had no choice but to pass on the costs in the form of higher premiums, pared back benefits, increased cost-sharing, and geographic contraction. The PDP program is becoming more and more precarious due to this short-sighted move by Democrats in 2022.
- To avoid negative election impacts, the Biden administration created a special premium stabilization program for 2025 that limited premium hikes by adding new government expenditures. This was a 3-year pilot. The Trump administration is seeking to reduce costs overall and has announced it will keep the program in 2026 but lower the dollars to plans. The stabilization effort next year will send $10 a month per enrollee to Part D insurers to help keep premiums in check, down from $15 this year. Insurers can raise premiums by as much as $50 a month, up from the $35 allowed this year.
The Trump administration was in a tough spot, inheriting a mess from the Biden CMS. The move to continue the stabilization program but at lower levels is not unreasonable despite the impact on enrollees.
#medicare #medicareadvantage #partd #pdp
https://kffhealthnews.org/news/article/medicare-part-d-premiums-rising-reasons/
On Drug Tariffs And Onshoring
Eli Lilly is speaking out against proposed tariffs on pharmaceuticals, saying they could increase drug costs and restrict patient access. I would agree this is the case on generic drugs for sure. Margins, percentage and dollar wise, are small and are less than tariffs. Now I dislike tariffs for many reasons, but it is hard to argue that Big Pharma companies could not eat any drug tariffs on brand drugs given their huge margins in America.
Lilly does say it has invested more than $50 billion in U.S. manufacturing since 2020, including 10 projects aimed at supplying the domestic market entirely from within the country. This is a goal of President Donald Trump and he thinks tariffs will promote onshoring.
Trump says he wants to phase in tariffs over time and they could hit as much as 250%. Trump also wants prices in other countries to rise to take away disparities and insulate some from a loss in research investments. Lilly of course blames everything but its price-seting for the disparity in prices between America and the rest of the developed world. At the same time, it has reached an agreement with the U.K. to raise the price of GLP-1 weight-loss drug Mounjaro for some cash-paying Britons.
#drugpricing #branddrugmakers #tariffs #weightlossdrugs #glp1s
https://www.beckershospitalreview.com/supply-chain/eli-lilly-pushes-back-on-proposed-tariffs
Buffett Buys UHG Stock
Investor Warren Buffett’s Berkshire Hathaway has bought 5 million shares of UnitedHealth Group, banking on the company turning its dismal finances around. David Tepper’s Appaloosa Management LP also bought 2.3 million shares.
United reported terrible financial news in 2025 after saying all was well in 2024. The UHG stock is still very low, but it soared on news of the Buffett transaction. Shares jumped 12% although United shares have dropped 46% this year.
(Article may require a subscription.)
#unitedhealthcare #margins
https://www.modernhealthcare.com/insurance/mh-unitedhealth-buffett-tepper-shares
Coverage Of Medicare Sequester Increasing
I told you some time ago that Medicare could be subject to cuts after the budget reconciliation bill even though Medicare was hardly touched. I ran through what is known as PAYGO sequestration that kicks in when a bill is passed that increases the federal budget deficit over time. That is exactly what the One Big Beautiful Bill Act (OBBBA) did. The rules call for a 4% annual reduction in Medicare.
On the urging of Democrats, the Congress Budget Office (CBO) updated its sequestration estimates. The OBBBA could mean Medicare cuts of 4% per year. That is about $45 billion in cuts in federal fiscal year (FFY) 2026, rising to $76 billion in 2034, and a total of about $491 billion over roughly 10 years.
The CBO notes that sequestration has never been triggered under the law since its enactment in 2010. It has been quietly overridden by Congress. But that means Democrats would have to join forces with the GOP to overrule the PAYGO reductions. They are unlikely to do so.
The other possibility is that the Trump administration ignores the sequestration law. The Office of Management and Budget (OMB) in the White House would be required to issue a sequestration order not more than 14 days after the end of the current session of Congress to meet the reductions for FFY 2026 (which starts October 1, 2025).
Additional articles: https://www.medpagetoday.com/publichealthpolicy/medicare/117032
#budgetreconciliation #obbba #trump #congress #sequestration #medicare
https://thehill.com/business/budget/5454945-trump-tax-law-medicare-sequestration/?tbref=hp
WellCare Free To Enroll in Missouri Again in MA
CMS has lifted an enrollment suspension on Wellcare of Missouri’s Medicare Advantage (MA) prescription drug plan as of January 1, 2026. The enrollment suspension was imposed in 2024 because the contract failed to meet the minimum medical loss ratio (MLR) requirement of 85% for three consecutive years. It reported an MLR over 85% for 2024 to get back in the good graces of the Centers for Medicare and Medicaid Services (CMS).
#mlr #wellcare #centene #margins
https://www.beckerspayer.com/payer/cms-lifts-enrollment-freeze-on-centene-medicare-plan-in-missouri
— Marc S. Ryan
