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The Potential Increase in Medicare Part B Premiums for 2024
Medicare Part B Premiums and the Impact of New Alzheimer's Treatment
Retirees may face an increase in Medicare Part B premiums for 2024, driven by the introduction of a new Alzheimer's treatment called Leqembi. The Medicare trustees projected that the standard monthly Part B premium may rise to $174.80 in 2024, almost a $10 monthly increase from the current $164.90 standard premium. Leqembi, which has recently gained Medicare coverage, is expected to become the third-costliest drug covered by Medicare Part B, potentially leading to higher premiums.
The Potential Impact on Medicare Part B Premiums
Annual spending on Leqembi and related services could add an estimated $5 per month to Part B premiums, bringing the total premium to $179.80 per month. The Senior Citizens League predicts that most beneficiaries may see their Part B premium increase by almost $15 per month due to this and other factors. This increase may impact the ability of retirees to budget and manage their healthcare expenses effectively.
The Connection between Social Security and Medicare Part B Premiums
Medicare Part B premium payments are typically deducted directly from monthly Social Security checks. The potential increase in Part B premiums for 2024 raises concerns about the impact on retirees' Social Security benefits. Individuals with lower benefits may not see any increase in their checks after the premiums are deducted, which can lead to financial strain and reliance on savings or debt.
The History of Part B Premium Increases and Coverage Changes
This is not the first time Part B premiums have increased due to the introduction of an Alzheimer's treatment. In 2022, Part B premiums experienced a 15% bump when Aduhelm, another Alzheimer's drug, emerged. However, for 2023, Part B premiums decreased by 3% in response to Medicare's decision to limit Aduhelm coverage. The unpredictability of Part B premiums and coverage changes has created challenges for retirees in planning for their healthcare costs.
Medicare Coverage and Cost of Leqembi
Medicare will cover Leqembi for patients with mild cognitive impairment or mild dementia with confirmed amyloid plaques. However, it is unknown how many Medicare patients will meet the prescribing requirements for the drug or choose to take it. Leqembi is priced at $26,500 before insurance coverage, and Medicare patients may pay more than $5,000 annually for the treatment. This cost does not include additional medical services or scans that may be necessary to monitor the effects of the treatment.
The Potential Approval of a Second Alzheimer's Treatment
An additional Alzheimer's treatment may be approved before the end of the year. However, the uptake of emerging Alzheimer's treatments may be limited initially due to the trade-offs between clinical benefits and significant side effects observed in clinical trials. Patients and healthcare providers will likely have extensive discussions about the value and risks of these medications before making a decision.
The Importance of Planning for Future Healthcare Costs
The potential increase in Medicare Part B premiums for 2024 highlights the importance of planning and budgeting for future healthcare expenses. Retirees should consider the potential impact on their Social Security benefits and explore supplemental coverage options, such as Medigap or Medicare Advantage, to help manage their healthcare costs effectively. It is crucial to stay informed about changes in Medicare coverage and premiums to make well-informed decisions about healthcare coverage.
Conclusion: The Potential Impact on New Businesses
The potential increase in Medicare Part B premiums for 2024, driven by the introduction of the new Alzheimer's treatment Leqembi, may have an indirect impact on new businesses.
As retirees face higher healthcare expenses due to increased premiums, their discretionary spending power may be reduced. This could lead to a decrease in consumer spending overall, affecting various industries and businesses. New businesses, in particular, may face challenges in attracting and retaining customers who have to allocate more of their budget towards healthcare.
Additionally, the connection between Social Security benefits and Medicare premiums becomes significant. Retirees with lower benefits may struggle to afford both healthcare costs and everyday expenses, limiting their ability to support local businesses.
Moreover, the unpredictability of Part B premiums and coverage changes can make it difficult for new businesses to plan their operations and budget effectively. Fluctuating healthcare costs for retirees may impact their disposable income and willingness to spend on non-essential products or services offered by new businesses.
In order to navigate the potential impact of increased Medicare Part B premiums, new businesses should consider targeting other demographic segments who may be less affected by these changes. They should also carefully monitor consumer trends and adapt their business strategies accordingly. Offering affordable options, discounts for Medicare beneficiaries, or partnering with healthcare providers may help attract and retain customers despite the potential financial strain caused by higher healthcare expenses.
Overall, while the direct impact of Medicare Part B premium increases may be felt by retirees, new businesses should be aware of the potential ripple effects on consumer spending and adjust their strategies to mitigate any negative consequences.Article First Published at: https://www.cnbc.com/2023/07/20/medicare-part-b-premiums-may-increase-in-2024-due-to-alzheimers-drug.html