Medicare Part D: Will late-enrollment penalties be waived?
Despite a stony silence from the White House, Congress is warming up tothe idea of waiving the penalty for seniors who missed Monday’s sign-updeadline for the Medicare drug benefit — and doing so in time for thefall elections.
Forgiving the penalty for this year is seen as acompromise between Republicans who firmly resisted pressure to extendthe sign-up period and Democrats who argued that beneficiaries neededmore time to figure out the biggest and most complicated change to theprogram in 40 years.Evenso, waiving the penalties for this year is unlikely to quell allcritics of the drug benefit. Many Democrats also want to give seniors aone-time chance this year to switch among the private prescriptionplans providing the coverage. And some want the government to negotiatedrug prices directly with manufacturers. That would save money, theysay, and the savings could be used to narrow the “doughnut hole.”
Thedoughnut hole is a coverage gap built into the program to save thegovernment money. When seniors’ total drug costs reach $2,250 for theyear, they must pay the next $2,850 in costs themselves, after whichMedicare pays 95% of all further drug expenses.
“The penaltyissue and the doughnut hole are going to be hitting around the time ofthe election,” said Drew Altman, president of the Kaiser FamilyFoundation. “It will be a lot easier to solve the enrollment penaltythan to plug the doughnut hole.”