Beneficiaries receive catastrophic coverage once their yearly out-of-pocket prescription drug spending hits $4,850. Then, the beneficiary pays for 5 percent of his or her prescription drug cost, and a mix of Medicare, payers and taxpayers come up with the rest.
Here are five things to know:
1. Compared to $27.7 billion in 2013, 2015 catastrophic prescription coverage hit $51.3 billion.
2. In 2015, 9 percent of beneficiaries were eligible for catastrophic coverage.
3. Yet, catastrophic coverage composed 37 percent of the $137 billion spent on Medicare prescription drug costs in 2015.
4. Increasing drug prices may prove detrimental to Medicare, as the program will not be able to withstand covering the 80 percent it usually puts forward for catastrophic coverage.
5. Medicare may have to eliminate its catastrophic coverage program if drug prices continue to escalate, leaving the payment to patients who likely can’t afford it.
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