Medicare doesn't reduce its 2022 premium hike even as use of Biogen's Alzheimer's drug is sharply curtailed
The prospect of the Centers for Medicare & Medicaid Services (CMS) paying for Biogen’s controversial Alzheimer’s drug Aduhelm opened up a multi-billion-dollar can of worms late last year that CMS now says it won’t right until 2023, leaving the agency with little explanation for major premium and deductible increases for seniors this year.
Back in November 2021, CMS explained that Medicare Part B will have to increase its standard monthly premium — from $148.50 in 2021 to $170.10 in 2022 — in part because of the massive spending that could occur should the agency sign off on a national coverage decision for Aduhelm, and its $56,000 annual price tag next year.
Since then, Biogen slashed the price of Aduhelm in half, but saw CMS’ restrictive national coverage decision for Aduhelm finalized, meaning the amyloid-targeted drug will only be used in clinical trials and won’t be covered by commercial insurance providers. That ostensibly means that sales of Aduhelm won’t amount to much for several years, and likely will never hit those initial $10 billion-plus per year estimates.
But HHS is sticking with those previously announced premium hikes and kicking the savings can down the road.
HHS Secretary Xavier Becerra said in a statement last Friday that while these Medicare Part B premiums for 2022 “should be adjusted downward to account for an overestimate in costs attributable to the inclusion of new Alzheimer’s drug Aduhelm,” due “to the legal and operational hurdles in adjusting Medicare premiums midstream in 2022, the reduction in premium costs attributable to Aduhelm will be incorporated into Medicare premiums for 2023 to lower Part B premiums paid by Medicare beneficiaries.”
According to a report from the CMS chief actuary earlier this month, the price change for Aduhelm and the finalized national coverage decision from CMS mean that “the level and amount of uncertainty regarding the potential use of Aduhelm were greatly reduced.”
If both of those issues had resolved earlier, the report says that the 2022 Part B premium would’ve been about $10 less than the current level, or $160.40.
“It is certain, however, that any additional funding caused by including the uncertainty of potential Aduhelm costs in the 2022 premium will be used to reduce the necessary financing in 2023 and later,” CMS chief actuary Paul Spitalnic wrote in a memo.
Some who are following this latest move by HHS questioned what CMS is doing differently with its additional info on Aduhelm, while others wonder if changing how much people paid this year could set a bad precedent.
Paul Ginsburg, a professor of health policy at the University of Southern California, told the Washington Post, “I could see chaos happening down the road almost every year where someone starts a campaign to pressure the secretary to lower the premium because something went better than expected.”
Surprised on how well the CMS/Aduhelm/Part B premium decision spin has worked. What they really announced is that they will do nothing other than what they would have done anyway in computing the annual premium amount for next year.
— Ian Spatz (@rockcreekpolicy) May 28, 2022