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Biden’s New Budget Proposal for Medicare Part D

author-photoWritten & Edited by Fran Majidi
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Fran Majidi

Fran Majidi manages content on SmartFinancial's website. She's had nearly a decade's worth of experience writing about i...

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Published March 18, 2024

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Key Takeaways

  • Medicare Part D prescription drug copays may drop to $2 or below on common medications for seniors.
  • Lowering copays may result in a rise in prices if Biden’s proposal hurts private insurers’ profitability.
  • Part D is included in Medicare Advantage or it is bought alongside Original Medicare as a Medicare supplement.

On March 11, President Joe Biden proposed a $7.3 trillion budget asking for Medicare drug plan Part D to keep copay prices for anti-cholesterol drugs, blood pressure medications and other high-cost drugs at $2 or below. New drug prices would go into effect October 1, 2024, in an emergency measure to alleviate seniors living at the poverty level of the high cost of prescription drugs.[1]

Seniors are already seeing lower drug prices with insulin caps at $35, free vaccines and out-of-pocket costs for prescription drugs capped at $2,000 starting in 2025.[2]

Medicare will cost $839 billion in 2024, because Biden’s plan also includes nutrition and obesity counseling and more cancer care evaluations, but that amount is expected to reach $1.7 trillion by 2034, when there will be a surge in people age 65 and older, according to ThinkAdvisor.[1]

However, before taking a deep breath hoping that Biden’s proposal means savings for seniors, Senior Savings Network told Newsweek that the changes may “have ripple effects on consumers that usually are not apparent until after the mandate is implemented.” Primarily, the changes will hit many Part D carriers and Medicare Advantage plans, which will have to struggle to remain profitable.[1]

Medicare Part D

Medicare Part D helps pay for prescription drugs at an additional cost to supplement Original Medicare plans. Medicare Advantage (Part C) plans often include Part D coverage, but not always.

There is no fixed premium for Part D coverage and the cost will vary by the individual. Our sample in Orange County, California, showed that the Part D premium could range from $7.50 to $160.20 in 2022.

Medicare Advantage

A Medicare Advantage (MA) plan is a full health insurance plan that provides what Original Medicare covers: Part A (hospital care) and Part B (doctor services). In addition, many MA plans include Part D (prescription drugs).

If your MA plan does not include prescription drug coverage, you can buy a new Medicare Advantage Plan that does or switch back to original Medicare and buy a separate Part D plan. You’ll have to do this during open enrollment or a special enrollment period.

Get Free Medicare Advantage Quotes Today!

Biden’s New Part D Prescription Drug Plan FAQs

What is prescription drug plan Part D and do I have it?

Part D is a Medicare supplement that provides prescription drug coverage and is often purchased as an add-on to original Medicare. If you have Part D, you would have a separate card for it; it will not be on the Medicare card. 

When can I buy prescription drug plan Part D or Medicare Advantage?

Prescription drug plan part D is a Medicare supplement that you can buy during the Medicare open enrollment period if you have Medicare. If you have Medicare Advantage, which is private Medicare, Part D is most likely already included in your plan, in which case you cannot join a separate Medicare drug plan.[3]

Is Part D included in Medicare Advantage?

Most Medicare Advantage plans include Part D prescription drug coverage. In most cases, Medicare Advantage members cannot buy a separate Part D plan unless they switch back to Original Medicare during open enrollment or a special enrollment period.[3]

How can I save on Part D or Medicare Advantage?

Compare prices on Medicare Part D or Medicare Advantage plans each year to get the best plan at the lowest cost.

Sources

  1. Newsweek. “Medicare Drug Prices Would Drastically Change Under New Plan.” Accessed March 18, 2024.
  2. The White House. “Fact Sheet: The Biden-Harris Administration Urges Congress to Lower Drug Costs for Americans With Commercial Insurance.” Accessed March 18, 2024.
  3. Medicare.gov. “Understanding Medicare Advantage Plans,” Page 4. Accessed March 18, 2024.
About the Author
Fran Majidi
Fran Majidi
Medicare Insurance Expert

Fran Majidi manages content on SmartFinancial's website. She's had nearly a decade's worth of experience writing about insurance-related topics. Prior, she was an arts and entertainment editor in New York City. She has a B.A. from Barnard College and an M.F.A. in writing from The New School. She writes books under her given name, Afarin Majidi.

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