Medicare participants enrolled in the health insurance program’s prescription drug benefit should see their premium cost decline slightly next year.
The Department of Health and Human Services said on Thursday the average monthly premium for Medicare Part D will be about $30 a month, down from $30.76 in 2011.
HHS officials attributed the decrease to increased competition and greater use of cheaper generic drugs.
The voluntary benefit pays for medicines for seniors and disabled Medicare patients who have signed up for separate drug insurance plans through private insurers such as Aetna Inc, Humana Inc and UnitedHealth.
The government subsidizes the gap between the premium patients pay and the amount that insurers bid to the program.
On Wednesday, the U.S. Centers for Medicare and Medicaid Services (CMS) released the 2012 nationwide bid information for Part D. The average bid by insurers declined to $84.50 a month, down 2.9 percent from 2011’s $87.05.
“This decline in the average creates more risk for plans like Humana and UnitedHealth that have a significant portion of the Part D members,” said Peter Costa, a Wells Fargo analyst.
Costa said one possible reason for the lower bids could be last year’s joint venture between Humana and Wal-Mart Stores to offer Medicare drug coverage with the lowest premiums in the country.