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2016 Medicare Part D Outlook
This is archive material for research purposes. Please see PDPFinder.com or MAFinder.com for current plans.
Below are the finalized 2016 Standard Benefit Model Plan parameters as released by The Centers for Medicare and Medicaid Services (CMS), April 2015.

Latest News on Medicare in 2016




CMS Part D 2016 Standard Benefit Model Plan Feature Highlights

Here are the highlights for the CMS defined Standard Benefit Plan changes from 2015 to 2016. The chart below shows the Standard Benefit design changes for plan years 2012, 2013, 2014, 2015 and 2016. This "Standard Benefit Plan" is the minimum allowable plan to be offered.
  • Initial Deductible:
    will be increased by $40 to $360 in 2016.
  • Initial Coverage Limit:
    will increase from $2,960 in 2015 to $3,310 in 2016.
  • Out-of-Pocket Threshold:
    will increase from $4,700 in 2015 to $4,850 in 2016.
  • Coverage Gap (donut hole):
    begins once you reach your Medicare Part D plan’s initial coverage limit ($3,310 in 2016) and ends when you spend a total of $4,850 in 2016.
    In 2016, Part D enrollees will receive a 55% discount on the total cost of their brand-name drugs purchased while in the donut hole. The 50% discount paid by the brand-name drug manufacturer will apply to getting out of the donut hole, however the additional 5% paid by your Medicare Part D plan will not count toward your TrOOP.
    For example: if you reach the donut hole and purchase a brand-name medication with a retail cost of $100, you will pay $45 for the medication, and receive $95 credit toward meeting your 2016 total out-of-pocket spending limit.
    Enrollees will pay a maximum of 58% coinsurance on generic drugs purchased while in the coverage gap (a 42% discount). For example: If you reach the 2016 Donut Hole, and your generic medication has a retail cost of $100, you will pay $58. The $58 that you spend will count toward yourTrOOP.
  • Minimum Cost-sharing in the Catastrophic Coverage Portion of the Benefit**:
    will increase to greater of 5% or $2.95 for generic or preferred drug that is a multi-source drug and the greater of 5% or $7.40 for all other drugs in 2016.
  • Maximum Copayments below the Out-of-Pocket Threshold for certain Low Income Full Subsidy Eligible Enrollees:
    will increase to $2.95 for generic or preferred drug that is a multi-source drug and $7.40 for all other drugs in 2016.




Chart Comparing 2012 through 2016 Standard Benefit Model Plan Features

Click here to see a comparison of plan parameters for all years since 2006

Medicare Part D Benefit Parameters for Defined Standard Benefit
2012 through 2016 Comparison
Part D Standard Benefit Design Parameters: 2016 2015 2014 2013 2012
Deductible - (after the Deductible is met, Beneficiary pays 25% of covered costs up to total prescription costs meeting the Initial Coverage Limit. $360 $320 $310 $325 $320
Initial Coverage Limit - Coverage Gap (Donut Hole) begins at this point. (The Beneficiary pays 100% of their prescription costs up to the Out-of-Pocket Threshold) $3,310 $2,960 $2,850 $2,970 $2,930
Out-of-Pocket Threshold - This is the Total Out-of-Pocket Costs including the Donut Hole. $4,850 $4,700 $4,550 $4,750 $4,700
Total Covered Part D Drug Out-of-Pocket Spending including the Coverage Gap - for Persons Qualifying For LIS - and are not eligible for the donut hole discount.
Catastrophic Coverage starts after this point.

See note (1) below.		 $7,062.50 (1) $6,680.00 (1) $6,455.00 (1) $6,733.75 (1) $6,657.50 (1)
Total Estimated Covered Part D Drug Out-of-Pocket Spending including the Coverage Gap Discount (NON-LIS) See note (2). $7,515.22

plus a 55% brand discount		 $7,061.76

plus a 55% brand discount		 $6,690.77

plus a 52.50% brand discount		 $6,954.52

plus a 52.50% brand discount		 $6,730.39

plus a 50% brand discount
Average NON-LIS percentage brand and generic drug purchases made during the coverage gap used to estimate the Total Covered Part D OOP threshold for NON-LIS beneficiaries (see above). Brand: 84.6%
Generic: 15.4%		 Brand: 85.9%
Generic: 14.1%		 Brand: 86.2%
Generic: 13.2%		 Brand: 85.6%
Generic: 14.4%		 Brand: 86.3%
Generic: 13.7%
Catastrophic Coverage Benefit:
   Generic/Preferred
   Multi-Source Drug (3)		 $2.95 (3) $2.65 (3) $2.55 (3) $2.65 (3) $2.60 (3)
    Other Drugs (3) $7.40 (3) $6.60 (3) $6.35 (3) $6.60 (3) $6.50 (3)
Part D Full Benefit Dual Eligible (FBDE) Parameters: 2016 2015 2014 2013 2012
   Deductible $0.00 $0.00 $0.00 $0.00 $0.00
   Copayments for
   Institutionalized
   Beneficiaries		 $0.00 $0.00 $0.00 $0.00 $0.00
Maximum Copayments for Non-Institutionalized Beneficiaries
    Up to or at 100% FPL:
        Up to Out-of-Pocket Threshold
      Generic/Preferred
      Multi-Source Drug		 $1.20 $1.20 $1.20 $1.15 $1.10
      Other $3.60 $3.60 $3.60 $3.50 $3.30
     Above Out-of-Pocket
     Threshold		 $0.00 $0.00 $0.00 $0.00 $0.00
    Over 100% FPL:
        Up to Out-of-Pocket Threshold
      Generic/Preferred
      Multi-Source Drug		 $2.95 $2.65 $2.55 $2.65 $2.60
      Other $7.40 $6.60 $6.35 $6.60 $6.50
     Above Out-of-Pocket
     Threshold		 $0.00 $0.00 $0.00 $0.00 $0.00
Part D Full Subsidy - Non Full Benefit Dual Eligible Full Subsidy Parameters: 2016 2015 2014 2013 2012
Eligible for QMB/SLMB/QI, SSI or applied and income at or below 135% FPL and resources < $8,780 (individuals) or < $13,930 (couples) (4)
   Deductible $0.00 $0.00 $0.00 $0.00 $0.00
    Maximum Copayments up to Out-of-Pocket Threshold
      Generic/Preferred
      Multi-Source Drug		 $2.95 $2.65 $2.55 $2.65 $2.60
      Other $7.40 $6.60 $6.35 $6.60 $6.50
   Maximum Copay above
   Out-of-Pocket
   Threshold		 $0.00 $0.00 $0.00 $0.00 $0.00
Partial Subsidy Parameters: 2016 2015 2014 2013 2012
Applied and income below 150% FPL and resources between $8,780-$13,640 (individuals) or $13,930-$27,250 (couples) (category code 4) (4)
   Deductible $74.00 $66.00 $63.00 $66.00 $65.00
   Coinsurance up to
   Out-of-Pocket
   Threshold		 15% 15% 15% 15% 15%
    Maximum Copayments above Out-of-Pocket Threshold
      Generic/Preferred
      Multi-Source Drug		 $2.95 $2.65 $2.55 $2.65 $2.60
      Other $7.40 $6.60 $6.35 $6.60 $6.50
Retiree Drug Subsidy Amounts: 2016 2015 2014 2013 2012
      Cost Threshold $360 $320 $310 $325 $320
      Cost Limit $7,400 $6,600 $6,350 $6,600 $6,500
(1) Total Covered Part D Spending at Out-of-Pocket Threshold for Non-Applicable Beneficiaries - Beneficiaries who ARE entitled to an income-related subsidy under section 1860D-14(a) (LIS)
(2) Total Covered Part D Spending at Out-of-Pocket Threshold for Applicable Beneficiaries - Beneficiaries who are NOT entitled to an income-related subsidy under section 1860D-14(a) (NON-LIS) and do receive the coverage gap discount. For 2016, the weighted gap coinsurance factor is 89.234%. This is based on the 2014 PDEs (84.6% Brands & 15.4% Generics)
(3) The Catastrophic Coverage is the greater of 5% or the values shown in the chart above. In 2016, beneficiaries will be charged $2.95 for those generic or preferred multisource drugs with a retail price under $59 and 5% for those with a retail price greater than $59. As to Brand drugs, beneficiaries would pay $7.40 for those drugs with a retail price under $148 and 5% for those with a retail price over $148.
(4) The actual amount of resources allowable may be updated for contract year 2016.

Click here to see a comparison of plan parameters for all years since 2006




2016 Federal Poverty Level Guidelines: LIS Qualifications

If your income is below 135% of the FPL (or for the remainder of 2016: $16,038 if you are single or $21,627 for married couples), you could qualify for the full Low-Income Subsidy (resource limits also apply - see chart above). Even if you don't qualify for full LIS benefits, you could be eligible for partial LIS benefits if your income level is at or below 150% FPL (resource limits also apply - see chart above). Remember, the LIS subsidy helps to pay both your monthly plan premiums and drug costs.

Go to our article to review more about the 2016 Federal Poverty Level Guidelines: 2016-2017 LIS Qualifications



Full Low-Income Subsidy Income Requirements (100% of FPL)
Persons
in Family		48 Contiguous
States & D.C.		AlaskaHawaii
1 $11,880 $14,840 $13,670
2 $16,020 $20,020 $18,430
3 $20,160 $25,200 $23,190
4 $24,300 $30,380 $27,950
5 $28,440 $35,560 $32,710
6 $32,580 $40,740 $37,470
Click here for additional family member figures

Learn more about the Extra-Help program.




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  • When enrolling in a Medicare Advantage plan, you must continue to pay your Medicare Part B premium.
  • Medicare beneficiaries with higher incomes may be required to pay both a Medicare Part B and Medicare Part D Income Related Monthly Adjustment Amount (IRMAA). Read more on IRMAA.
  • Medicare Advantage plans that include prescription drug coverage (MAPDs) are considered Medicare Part D plans and members with higher incomes may be subject to the Medicare Part D Income Related Monthly Adjustment Amount (IRMAA), just as members in stand-alone Part D plans. In certain situations, you can appeal IRMAA.
  • You must be enrolled in both Medicare Part A and Part B to enroll in a Medicare Advantage plan. Members may enroll in a Medicare Advantage plan only during specific times of the year. Contact the Medicare plan for more information.
  • If you are enrolled in a Medicare plan with Part D prescription drug coverage, you may be eligible for financial Extra Help to assist with the payment of your prescription drug premiums and drug purchases. To see if you qualify for Extra Help, call: 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/ 7 days a week or consult www.medicare.gov; the Social Security Office at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY users should call, 1-800-325-0778; or your state Medicaid Office.
  • Medicare evaluates plans based on a 5-Star rating system. Star Ratings are calculated each year and may change from one year to the next.
  • A Medicare Advantage Private Fee-for-Service plan (PFFS) is not a Medicare supplement plan. Providers who do not contract with the plan are not required to see you except in an emergency.
  • Disclaimer for Institutional Special Needs Plan (SNP): This plan is available to anyone with Medicare who meets the Skilled Nursing Facility (SNF) level of care and resides in a nursing home.
  • Disclaimer for Dual Eligible (Medicare/Medicaid) Special Needs Plan (SNP): This plan is available to anyone who has both Medical Assistance from the State and Medicare. Premiums, co-pays, co-insurance, and deductibles may vary based on the level of Extra Help you receive. Please contact the plan for further details.
  • Disclaimer for Chronic Condition Special Needs Plan (SNP): This plan is available to anyone with Medicare who has been diagnosed with the plan specific Chronic Condition.
  • Medicare MSA Plans combine a high deductible Medicare Advantage Plan and a trust or custodial savings account (as defined and/or approved by the IRS). The plan deposits money from Medicare into the account. You can use this money to pay for your health care costs, but only Medicare-covered expenses count toward your deductible. The amount deposited is usually less than your deductible amount, so you generally have to pay out-of-pocket before your coverage begins.
  • Medicare MSA Plans do not cover prescription drugs. If you join a Medicare MSA Plan, you can also join any separate (stand-alone) Medicare Part D prescription drug plan
  • There are additional restrictions to join an MSA plan, and enrollment is generally for a full calendar year unless you meet certain exceptions. Those who disenroll during the calendar year will owe a portion of the account deposit back to the plan. Contact the plan provider for additional information.
  • Medicare beneficiaries may enroll through the CMS Medicare Online Enrollment Center located at www.medicare.gov.
  • Medicare beneficiaries can file a complaint with the Centers for Medicare & Medicaid Services by calling 1-800-MEDICARE 24 hours a day/7 days or using the medicare.gov site. Beneficiaries can appoint a representative by submitting CMS Form-1696.
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