The Biden-Harris administration is using billions of taxpayer dollars to bail out health insurers in order to mask impending rises in Medicare Part D plans less than 100 days out from Election Day — and being criticized for it.
The Democrat-supported 2022 Inflation Reduction Act (IRA) limited out-of-pocket drug costs for Medicare recipients, which in turn put insurers in the position of dramatically hiking monthly premiums, Breitbart News reported.
The average bids for Part D plans are predicted to triple by 2025, according to an analysis by Fox News.
With these concerns hitting senior voters, the Centers for Medicare and Medicaid Services (CMS), a federal agency within the U.S. Department of Health and Human Services (HHS), developed a three-year “demonstration project” to subsidize those spiking premiums.
While the Biden-Harris administration aims to keep the Part D plans at an artificially low cost, some policy experts are pointing out that taxpayers will be footing the bill for the appearance of relief.
“What do insurers do when the costs of their plans go up? They raise premiums, of course,” Jackson Hammond of the Paragon Health Institute wrote in an August 5 report.
“We don’t know yet what premiums will be in Part D,” the senior policy analyst stated, “but, we do know they will jump because the average bid submitted by plans for stand-alone PDPs has skyrocketed from $64.28 in 2024 to $179.45 in 2025 – and roughly 25 percent of the increase will be borne by beneficiaries and 75 percent borne by taxpayers.”
According to Hammond, this could have been avoided with a higher out-of-pocket cap:
The original bipartisan Part D redesign had a cost cap of $3,100, which would have limited both premium increases and taxpayers’ liability. It’s worth noting that former CBO director Doug Holtz-Eakin estimates that less than three percent of Medicare beneficiaries were facing out-of-pocket costs greater than $2,000. So instead under the partisan IRA, Part D premiums have been driven much higher.
“CMS has yet to release any cost estimates, but some back-of-the-envelope math puts the cost over three years well in excess of $10 billion for a demonstration,” he added.
The institute’s report labeled the CMS demo plan a “fake, costly demonstration.”
Joe Grogan, a former domestic policy adviser to Donald Trump, also argued that the administration is just shifting costs to burden taxpayers even more.
“They’ve destroyed part D premiums,” Grogan told Fox News. “I’m not sure it’ll survive legal scrutiny if someone were to sue. Objectively, it shouldn’t be done. It’s just interjecting $5-10 billion of taxpayer dollars, while the taxpayers are paying the price 85 days before an election. It’s sickening.”
“This is only going to get worse in 2025, 2026,” Grogan added. “The program is in a death spiral. They announced a three-year demo. It’s already broken. The demo is going to fail. Premiums are still going to go up.”
Approximately 67.3 million Americans were enrolled in Medicare as of April, with about 80 percent being covered by Part D, according to CMS.
“They just want to get through the election,” Grogan said. “They’re hoping after the election they can face it, but it’s gonna need to be dealt with in the next 12–18 months. They did not believe it would be this bad and it’s only gonna get worse.”
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