NYT: Medicare Drug Spending Expected to Be Well Below Estimates

[DeepModem Mom]

Medicare Drug Spending Expected to Be Well Below Estimates
By ROBERT PEAR
Published: February 2, 2006


WASHINGTON, Feb. 2 — Federal spending on the new Medicare drug benefit will be 20 percent lower than expected this year because beneficiaries are choosing prescription drug plans with low premiums, the Bush administration said today.

"People are tending to sign up for less expensive plans," said Dr. Mark B. McClellan, administrator of the federal Centers for Medicare and Medicaid Services.

Beneficiary premiums are now expected to average $25 a month, down from the $37 projected last year, Dr. McClellan said.

The net cost to the federal government for the drug coverage in 2006 is expected to be $30.5 billion, down from a prior estimate of $38.1 billion — a difference of $7.6 billion, or 20 percent....

***

One reason for the lower cost is the intense competition among private insurers offering drug coverage to older Americans. The multiplicity of drug plans has caused immense confusion among beneficiaries and pharmacists....


http://www.nytimes.com/2006/02/02/politics/02cnd-drug.html

[salin]

1. or maybe the lower costs reflect the low numbers of enrollees?

just asking.

[MidwestTransplant]

2. I am sure that's it more than anything else. People don't enroll, so it

costs less. They are WAY below their target enrollment.

[DeepModem Mom]

3. I couldn't get a handle on this either. I wonder if anybody knows...

anything, as it's all such an eff-up.

[MGKrebs]

4. Why are the premiums lower?

Less coverage? More patient costs? I suspect the government is paying less because the consumers are paying more.

Video footage of grandma eating cat food right around the corner.