President Biden’s FY 2022 budget proposes lowering the Medicare enrollment age from 65 to 60, and a group of over 150 House Democrats recently called for a provision lowering the Medicare age to 60 or 55 to be included in the President’s American Families Plan. President Biden’s budget proposes “giving people age 60 and older the option to enroll in the Medicare program with the same premiums and benefits as current beneficiaries, but with financing separate from the Medicare Trust Fund.” The President’s budget proposal does not detail how lowering the Medicare age would work or be financed, or how it would affect current Medicaid spending and enrollees. While lowering the Medicare eligibility age based solely on work history to 60 could provide coverage to older adults who are currently uninsured or provide a more affordable option for people with private health insurance coverage, it also could affect Medicaid enrollees in this age range. Some Medicaid enrollees might lose Medicaid coverage when they gain Medicare, and others might become dually eligible for both programs, depending on the details of how it would work.

There are 3 million adults ages 60-64 enrolled in Medicaid as of 2019, just under 1 million of whom are already dually eligible for both Medicare and Medicaid (because they receive Social Security Disability Insurance (SSDI)). Medicare covers over 60 million seniors and nonelderly adults with significant long-term disabilities. Under current law, people with a sufficient work history are entitled to enroll in Medicare at age 65, and enrollment for non-elderly adults is limited to people who receive SSDI, generally after a 24 month waiting period. This issue brief highlights key differences between Medicare and Medicaid and raises questions about how a policy to lower the age of Medicare eligibility could affect individuals who are currently enrolled in Medicaid.

How could lowering the Medicare age affect people eligible for full Medicaid benefits?

What is current policy? Today, some people are eligible for both Medicare and full Medicaid benefits, while others may lose Medicaid eligibility once they become eligible for Medicare. A person’s status as a Medicare beneficiary does not qualify them for full Medicaid benefits. Instead, a person must independently qualify for Medicaid through an eligibility pathway based on low income or disability. Individuals in the 60-64 age range may qualify for Medicaid through various pathways that may have different eligibility criteria and benefit packages. For example:

• Poverty-related Medicaid pathways, such as the ACA expansion (which 38 states plus DC have opted for), consider a person’s income but do not have an asset test. Notably, receiving Medicare and/or turning 65 makes someone ineligible for Medicaid as an ACA expansion adult.
• Disability-related Medicaid pathways have relatively higher income limits compared to the poverty-related pathways described above and may have an asset limit, though some states have expanded or eliminated asset limits. State Medicaid programs must cover SSI enrollees, while other disability-related pathways are optional. States can choose to cover seniors and people with disabilities up the federal poverty level, people with high medical expenses considered medically needy, working people with disabilities, and those with incomes up to 300% of the federal SSI benefit amount ($2,382 per month for an individual in 2021) who need long-term home and community-based services, though eligibility pathways vary substantially by state. Unlike the ACA expansion pathway, individuals who qualify under these pathways may be dually eligible for Medicare. For those dually eligible for Medicare and Medicaid, Medicare is the primary payer, and Medicaid provides wrap-around benefits, filling in gaps in Medicare coverage, and also helps with Medicare’s out-of-pocket costs (discussed below).

What are the key policy choices and implications?  Lowering the age for Medicare would require policy choices about whether to allow individuals in the new age range to continue to receive full Medicaid benefits, if eligible under the ACA expansion or other poverty- or disability-related pathways, or whether these individuals would move from Medicaid to Medicare as their sole or primary source of coverage. How these eligibility issues are resolved has important implications for enrollee benefits and cost-sharing as well as state and federal costs (discussed below). Additionally, Medicare enrollment is limited to specific periods, while Medicaid enrollment is open year-round. However, Medicaid eligibility must be periodically renewed, while Medicare eligibility currently continues without the need to renew eligibility once a person turns 65.

How could lowering the Medicare age affect benefits for current Medicaid enrollees?

What is current policy?  Medicare and Medicaid’s benefit packages differ. Both cover inpatient and outpatient care and prescription drugs. Medicare generally includes wider participation of providers, though Medicaid drug coverage is broader. Medicaid also covers long-term care services in nursing homes and the community and specialty behavioral health services, which Medicare generally does not. Medicaid covers dental, vision, and hearing benefits for adults at state option. Traditional Medicare currently does not generally cover these benefits, although most Medicare Advantage plans do offer some dental, vision and hearing benefits. President Biden’s budget calls for adding these benefits to Medicare. Medicaid rules also require states to recover the cost of long-term care benefits provided to people age 55 and older from the estates of deceased enrollees, and other costs may be subject to estate recovery at state option. Medicare does not require estate recovery, though it also does not cover long-term care services. The appeals process also differs between the two programs, with Medicaid allowing services to continue while an appeal is pending.

What are the key policy choices and implications?  Policy choices about whether individuals in the new age range could retain Medicaid if eligible or instead would move from Medicaid to Medicare are important because individuals currently eligible for Medicaid could lose access to benefits not covered by Medicare if they are required to move to Medicare as their sole source of coverage. Additionally, those appealing benefit reductions or terminations would not have continued access to services while appeals are resolved in Medicare as is the case in Medicaid.

How could lowering the Medicare age affect provider networks for current Medicaid enrollees?

What is current policy? People may have access to different provider networks in Medicare vs. Medicaid, due to different managed care and network adequacy rules. Once eligible for coverage, Medicare allows enrollees to choose whether to receive benefits under the traditional Medicare program, or enroll in a Medicare Advantage managed care plan. Traditional Medicare offers access to a broad provider network, while Medicare Advantage plans have restricted provider networks. States may require Medicaid enrollees to enroll in managed care, which can further restrict provider networks beyond those that participate in the state’s fee-for-service Medicaid program.

What are the key policy choices and implications? People could gain access to a broader provider network through traditional Medicare compared to their state’s Medicaid program. If moving from Medicaid to Medicare, individuals could experience  changes in delivery systems and provider networks, depending on whether they opt for Medicare Advantage or traditional Medicare, which could mean disruptions in care.

How could lowering the Medicare age affect out-of-pocket costs for current Medicaid enrollees?

What is current policy? The Medicare Savings Program (MSP) is a Medicaid pathway that helps to cover Medicare’s premiums and/or cost-sharing requirements for current Medicare enrollees with low income and limited assets. This is an important consideration because Medicare’s premiums and cost-sharing are higher than those under Medicaid, which limits the populations who can be subject to premiums and has nominal cost-sharing. Box 1 summarizes current Medicare out-of-pocket costs and the assistance available through MSP.

What are the key policy choices and implications?  Proposals to lower the Medicare age likely will have to account for what type of assistance would be available to make the new coverage affordable for lower income enrollees, such as individuals who may lose Medicaid and transfer to Medicare. Without addressing this issue, some people could face higher out-of-pocket costs in Medicare compared to Medicaid. For example, people ages 60-64 who currently receive Medicaid in the ACA expansion group are eligible for that coverage based on their low incomes and without an asset test. When these individuals become eligible for Medicare under current law, they must meet both income and asset limits (Box 1) to qualify for MSP help with Medicare out-of-pocket costs. Though a few states have expanded or eliminated MSP asset limits, this generally means that individuals with savings above $7,970 would be ineligible for MSP, even though they might have been eligible for full Medicaid benefits in expansion states.

How might lowering the Medicare age affect state and federal costs and provider payments?

What is current policy? Medicare is a federal program primarily financed by a combination of payroll taxes, general revenue, and premiums. In traditional Medicare, the federal government establishes the methodology for making payments to hospitals, physicians and other health care providers under the traditional Medicare program and uses a formula to establish capitated payments to Medicare Advantage plans. In contrast, Medicaid is financed jointly by states and the federal government, and states determine provider payment rates within broad federal standards.

What are the key policy choices and implications? The precise impact of lowering the Medicare age on federal and state costs depends on how the policy is structured. Transitioning current Medicaid enrollees to Medicare would be likely to increase federal spending and reduce state costs as states would no longer share in the costs of covering these individuals. If individuals 60-64 are permitted to retain their current Medicaid eligibility, states would continue to fund a share of these individuals’ Medicaid costs, though Medicare would be the primary payer for the benefits it covers. If enrollees move to Medicare and do not retain full Medicaid eligibility, the federal government would no longer pay for a share of benefits that are only available through Medicaid (like long-term care).

Whether and how lowering the Medicare age would affect provider payment rates is likely to vary depending on the type of provider. Medicaid payment rates for hospitals vary across states, but after accounting for supplemental payments, overall rates for hospitals are comparable to or higher than Medicare. Lowering the Medicare age might lead to lower revenues for physicians, as Medicaid payment rates for physicians tend to be lower than Medicare. Gross margins for Medicare Advantage plans are higher than for Medicaid managed care plans, though Medicare Advantage plans now cover an older population with higher health spending. While rates in Medicaid plans must be actuarily sound, they tend to be lower than other markets.

Looking Ahead

Lowering the Medicare enrollment age could have considerable impacts on the scope of covered benefits, out-of-pocket costs, and provider access for low-income people as well as implications for state and federal health care costs. Depending on individual circumstances and key policy decisions, people who move from Medicaid to Medicare might experience higher out-of-pocket costs and/or fewer covered benefits. On the other hand, they might have access to a broader provider network in traditional Medicare, compared to their state’s Medicaid program. On the whole, current Medicaid enrollees are likely to face different issues than those who move from private insurance or uninsured status to Medicare.

The question of what would happen when a new, expensive prescription drug comes to market for a disease like Alzheimer’s that afflicts millions of people has loomed large in discussions over drug prices in the U.S.—and now we’re about to find out. After a nearly 20-year dry spell in new treatments for Alzheimer’s disease, the Food and Drug Administration (FDA) just approved a new Alzheimer’s medication, Aduhelm (aducanumab), developed by Biogen, with an expected annual price tag of $56,000. While the scientific community debates the evidence of the effectiveness of this new drug, the FDA’s decision raises hope for Alzheimer’s patients and their families, along with serious cost concerns for patients and payers, particularly Medicare.

Alzheimer’s disease is estimated to affect about 6 million Americans, the vast majority of whom are age 65 and older and therefore eligible for Medicare. As an intravenous infused medication administered by physicians, Aduhelm will be covered under Medicare Part B, which generally covers FDA-approved physician-administered medications that are reasonable and necessary for the individual patient. (In contrast, Medicare Part D covers retail prescription drugs.) With FDA approval in hand, attention now turns to decision-makers at the Centers for Medicare & Medicaid Services (CMS) who may opt to undertake a National Coverage Determination process that could set some limits on the conditions of Medicare coverage for Aduhelm based on the drug’s clinical effectiveness.

Medicare’s long-standing practice is to make coverage determinations without taking cost into consideration. While Medicare sets rates for hospitals and other providers, it does not set its own rates for drugs covered under Part B. Instead, Medicare reimburses providers 106% of the Average Sales Price (ASP), which is the average price to all non-federal purchasers in the U.S, inclusive of rebates. For drugs where no ASP is available, such as a new drug like Aduhelm, Medicare pays 103% of the wholesale acquisition cost (WAC) until ASP data are available. The WAC is equivalent to a list price and typically higher than ASP. Biogen has set the list price for Aduhelm at $56,000 for a year of treatment.

It is hard to know exactly how many Medicare beneficiaries will take Aduhelm, but even a conservative estimate would lead to a substantial increase in Medicare spending. In 2017, nearly 2 million Medicare beneficiaries used one or more of the currently-available Alzheimer’s treatments covered under Part D, based on our analysis of Medicare Part D claims data. If just one-quarter of these beneficiaries are prescribed Aduhelm, or 500,000 beneficiaries, and Medicare pays 103% of $56,000 in the near term, total spending for Aduhelm in one year alone would be nearly $29 billion, paid by Medicare and the patients who use this drug – an amount that far exceeds spending on any other drug covered under Medicare Part B or Part D, based on 2019 spending. To put this $29 billion amount in context, total Medicare spending for all Part B drugs was $37 billion in 2019.

If 1 million Medicare beneficiaries receive Aduhelm, which may even be on the low end of Biogen’s expectations, spending on Aduhelm alone would exceed $57 billion dollars in a single year – far surpassing spending on all other Part B-covered drugs combined. In fact, this amount is roughly the same that Medicare paid for all hospital outpatient services in 2019.

Alzheimer’s patients covered under Medicare Part B could also face high out-of-pocket costs for treatment with Aduhelm, both for the drug itself and for the cost of related medical services. For most Part B covered drugs and services, Medicare pays 80% of the cost and beneficiaries are responsible for the remaining 20%. This means beneficiaries would face about $11,500 in coinsurance for one year of Aduhelm treatment, which represents nearly 40% of the $29,650 in median annual income per Medicare beneficiary in 2019. Because Aduhelm is not a cure for Alzheimer’s disease, patients could incur these annual out-of-pocket costs over multiple years.

The majority of beneficiaries in traditional Medicare have supplemental insurance, such as Medigap, employer-sponsored retiree coverage, or Medicaid, that would cover some or all of the coinsurance. However, beneficiaries with Medigap or retiree health could see their premiums rise to account for higher plan liability associated with costs for Aduhelm. And close to 6 million Medicare beneficiaries, or 10% of all beneficiaries, are in traditional Medicare with no supplemental coverage, which means they are fully exposed to Medicare’s cost-sharing requirements and lack the financial protection of an out-of-pocket cap, unlike enrollees in Medicare Advantage plans.

The 24 million beneficiaries enrolled in Medicare Advantage plans are also responsible for cost sharing for Part B drugs, like Abuhelm, though they typically do not have supplemental insurance to help with these expenses. According to our estimates, in 2021, nearly 90% of Medicare Advantage enrollees are in plans that charge 20% coinsurance for Part B drugs provided in-network, the same as under traditional Medicare, though some plans impose coinsurance as high as 45% or 50% for Part B drugs administered by out-of-network providers. Medicare Advantage enrollees who use Aduhelm would be responsible for their share of costs until they reach the annual out-of-pocket maximum ($7,550 for in-network care and $11,300 for combined in-network and out-of-network care in 2021).

The billions of dollars in new Medicare Part B spending will likely lead to higher Part B premiums for all 56 million Part B enrollees in traditional Medicare and Medicare Advantage. Since Part B premiums are set to equal 25% of projected annual Part B expenditures, an increase in spending would lead to an increase in premiums. State and federal Medicaid spending will also rise, since Medicaid pays the Part B premium for about 12 million low-income Medicare beneficiaries with Medicaid, and covers coinsurance for 9 million of these beneficiaries who have both Medicare and full Medicaid coverage.

The introduction of a new high-priced drug could energize efforts in Congress to enact drug price legislation. Under H.R. 3, which passed the House of Representatives in the last Congress and was recently reintroduced, the HHS Secretary would have authority to negotiate prices for up to 250 drugs, drawing from the 125 drugs with the highest net spending in Medicare Part D and the 125 drugs with the highest net spending in the U.S. overall, which could include drugs covered under Part B, such as Aduhelm. Negotiated prices would be made available to enrollees in Part D plans and private insurance coverage, and to providers that administer physician-administered drugs. Other proposals under active consideration would limit annual price increases for Part B and Part D drugs and limit the financial incentives under Medicare’s existing Part B reimbursement system for physicians to administer higher-priced drugs. The Center for Medicare and Medicaid Innovation could also test models to modify Medicare payments for high-priced drugs.

At a time when federal and state policymakers are weighing several policy options to lower prescription drug prices, the approval of Aduhelm provides the latest high-profile example of the potential budgetary consequences of Medicare’s role as a price-taker in the pharmaceutical marketplace. Concerns about the impact on Medicare spending associated with Aduhelm are reminiscent of discussions that took place after the introduction of high-cost treatments for hepatitis C, though in that case, the new drugs cured the disease and were approved for a much smaller patient population. Aduhelm may represent hope for Alzheimer’s patients and their families who have waited years for new treatments to come along, but that hope is likely to come at a high cost to Medicare, beneficiaries, and taxpayers.

The Biden Administration has started taking steps to reverse Trump Administration policy and regulations that significantly narrowed the implementation and administrative enforcement of Section 1557, the Affordable Care Act’s nondiscrimination provision, particularly as the regulations apply to gender identity and sexual orientation. In addition, several lawsuits challenging the regulations, which were initially issued by the Obama Administration and later substantially revised by the Trump Administration, are pending. Section 1557 prohibits discrimination based on race, color, national origin, sex, age, and disability in health programs and activities receiving federal financial assistance. The two versions of the regulations, those from the Obama Administration followed by those from the Trump Administration, adopted conflicting interpretations about the content and scope of prohibited discrimination. This issue brief provides an update on current developments and identifies issues to watch in the coming weeks and months.

Administrative Actions

On May 10, 2021, the Biden Administration announced that the HHS Office for Civil Rights (OCR) will include gender identity and sexual orientation as it interprets and enforces Section 1557’s prohibition against sex discrimination (Figure 1). This announcement followed a federal agency review of existing regulations and policy directed by President Biden’s executive order on preventing and combatting discrimination based on gender identity and sexual orientation, which he issued on his first day in office. The May 2021 announcement marks both a reversal of Trump Administration policy and an expansion of Obama Administration policy. While the Obama Administration regulations included gender identity and sex stereotyping in the definition of sex discrimination, they omitted sexual orientation, noting that federal law in this area was still evolving at that time. Subsequently, the Trump Administration eliminated gender identity and sex stereotyping from the regulations. However, just after the Trump Administration regulations were published, the Supreme Court, in Bostock v. Clayton County, Georgia, ruled that sex discrimination in the employment context does include discrimination based on gender identity or sexual orientation. Following the Bostock ruling, two federal district courts issued nationwide preliminary injunctions (Figure 1 and described further below), blocking implementation of several provisions of the Trump Administration’s regulations related to Section 1557.

HHS recently indicated that it will issue a new notice of proposed rule-making (NPRM) to revise the Section 1557 regulations. The Biden Administration states that its “anticipated rulemaking proceeding will provide for the reconsideration of many or all of the changes to existing Section 1557 regulations” that are being challenged in current litigation (described below). The timeframe for the new NPRM is uncertain, with HHS stating that it intends to do so “as expeditiously as reasonably possible” while “account[ing] for HHS’s limited resources. . . .” In light of the Biden Administration’s May 10 announcement, it is likely that the new NPRM will propose not only restoring gender identity but also adding sexual orientation to the regulatory definition of sex discrimination, thereby expanding on the Obama Administration interpretation. The extent to which the new NPRM proposes restoring or expanding other Section 1557 provisions that were changed by the Trump Administration unrelated to the definition of sex discrimination, such as those related to discrimination in health insurance benefit design; language access; notices, grievance procedures, and enforcement; and covered entities, remains to be seen. The new NPRM also could propose restoring provisions prohibiting discrimination based on gender identity and sexual orientation that were eliminated by the Trump Administration in other federal health care regulations outside of Section 1557 that apply to Medicaid, the ACA Marketplaces, and private insurance issuers.

Court Actions

Three of the five cases challenging the Trump Administration regulations have been put on hold to provide the Biden Administration with additional time to complete its review of existing regulations and policy (Table 1). Courts in two of the cases on hold issued the nationwide preliminary injunction orders that continue to block implementation of some provisions of the Trump Administration regulations. These orders remain in place, although the federal government appealed both of them. A third case challenging the Trump Administration regulations also has been put on hold, though the parties disagree about how long the delay in that case should last. The cases currently on hold include:

• A DC case, Whitman-Walker Clinic v. HHS, brought by health care and social service providers who serve LGBTQ people and people with limited English proficiency (LEP). The district court’s nationwide preliminary injunction prevents the federal government from implementing provisions of the Trump Administration regulations that (1) exclude sex stereotyping from definition of sex discrimination and (2) incorporate a blanket religious freedom exemption from claims of sex discrimination. The next status report is due to the court on August 12, 2021.
• A New York case, Asapansa-Johnson Walker v. Azar, brought by two transgender women of color. The district court’s nationwide preliminary injunction prevents the federal government from implementing provisions of the Trump Administration regulations that exclude gender identity and sex stereotyping from definition of sex discrimination, require healthcare providers to treat individuals consistent with their gender identity, and prohibit providers from denying or limiting services based on gender identity. The next status report is due to the court on August 12, 2021.
• Another New York case, NY v. HHS, brought by a group of 23 states. Both sides have agreed to put the case on hold but disagree about when the next status report should be due to the court. The states propose June 13, 2021, while the federal government proposes August 12, 2021.

Two other cases challenging the Trump Administration regulations are currently active (Table 1). Decisions in these cases could influence the contents of the Biden Administration’s expected NPRM as well as the status of the Trump regulations that remain in effect. The active cases include:

• A Massachusetts case, Boston Alliance of Gay, Lesbian, Bisexual & Transgender Youth v. HHS, brought by a transgender man and health care and social service providers who serve LGBTQ people and people with LEP. A June 3, 2021 hearing is scheduled on HHS’s motion to dismiss the lawsuit.
• Another DC case, Chinatown Service Center v. HHS, brought by community-based organizations serving older adults with LEP. The complaint in this case was filed recently, and HHS has not yet responded.

Another two cases, which were filed to challenge the Obama Administration regulations and are still pending, raise issues about the interaction between Section 1557’s nondiscrimination provisions and federal laws that protect religious beliefs. The Supreme Court did not reach this issue in Bostock, noting that this is a question for future cases to decide. These cases include:

• Religious Sisters of Mercy v. Becerra, in which the Biden Administration is appealing a North Dakota federal court ruling that blocks it from requiring Catholic health care entities to perform or provide health insurance coverage for gender transition services under the Obama Administration’s Section 1557 regulations.
• Franciscan Alliance v. Becerra, in which religiously affiliated health care providers claim that the Obama Administration regulations’ inclusion of gender identity and termination of pregnancy in the definition of sex discrimination would require them to serve people seeking transgender care and people who have terminated a pregnancy in violation of the providers’ religious rights. The 5^th Circuit Court of Appeals sent the case back to the trial court to determine whether the providers’ claims are moot in light of the subsequent Trump Administration regulations as well as the recent Biden Administration actions. Briefing on these issues closes on June 18, 2021.

Looking Ahead

The interpretation and enforcement of Section 1557’s prohibition against discrimination in federally funded health programs and activities will continue to develop in the coming months. Outside of the Section 1557 regulations and surrounding litigation, federal courts in other cases have granted relief to individuals alleging discrimination under Section 1557, relying on the text of the statute itself. For example, a Wisconsin federal court permanently blocked the state Medicaid program’s categorical exclusion of gender affirming services from coverage as a violation of the statutory prohibition against sex discrimination. Future court rulings, the forthcoming NPRM, and administrative enforcement by OCR under the new Biden Administration policy together will influence Section 1557 law and policy and could affect the ability to access health coverage and care without discrimination.

The Medicare Part D program provides an outpatient prescription drug benefit to older adults and people with long-term disabilities in Medicare who enroll in private plans, including stand-alone prescription drug plans (PDPs) to supplement traditional Medicare and Medicare Advantage prescription drug plans (MA-PDs) that include drug coverage and other Medicare-covered benefits. This analysis provides the latest data about Medicare Part D enrollment, premiums, and cost sharing in 2021 and trends over time, based on data from the Centers for Medicare & Medicaid services (CMS) Part D Enrollment, Benefit, Landscape, and Low Income Subsidy files.

Part D enrollment in Medicare Advantage drug plans has increased over time, while enrollment in stand-alone prescription drug plans has decreased in recent years

A total of 48 million people with Medicare are currently enrolled in plans that provide the Medicare Part D drug benefit, representing more than three-quarters (77%) of all Medicare beneficiaries. This total includes plans open to everyone with Medicare, including stand-alone PDPs and MA-PDs, and plans for specific populations, including retirees of a former employer or union and Medicare Advantage Special Needs Plans (SNPs). Over time, Part D enrollment in MA-PDs has increased, reflecting enrollment growth in Medicare Advantage plans overall, while enrollment in PDPs has decreased each year since 2019.

In 2021, half of all Part D enrollees are enrolled in stand-alone PDPs (50%), and the other half are in MA-PDs (50%), but a slightly larger number of enrollees are in MA-PDs (24.1 million) than in PDPs (23.9 million) (Figure 1, Table 1). (MA-PD enrollment includes Medicare Advantage HMOs, PPOs, private fee-for-service, and Medicare Savings Account plans, and other Medicare private plans, including Medicare-Medicaid plans, Cost plans, and PACE plans). Between 2020 and 2021, the number of MA-PD enrollees increased by 11%, while enrollment in PDPs decreased by 4%.

Part D enrollment is concentrated in 3 national firms – UnitedHealth, Humana, and CVS – which have a combined 56% of total enrollment

The top three firms – UnitedHealth, Humana, and CVS Health – cover close to 6 in 10 of all beneficiaries enrolled in Part D in 2021 (56%), while the top five firms – including Centene and Cigna – account for three-quarters (74%) of Part D enrollment (Figure 2). With the exception of Kaiser Permanente, which exclusively offers MA plans, the top Part D plan sponsors offer both stand-alone PDPs and MA-PDs. For most firms, Part D enrollment is more concentrated in one market than the other; for example, CVS Health, Centene, and Cigna have greater enrollment in PDPs than MA-PDs (Table 2).

An increasing share of beneficiaries receiving low-income subsidies are enrolled in Medicare Advantage drug plans, with just over half now enrolled in MA-PDs

In 2021, nearly 13 million Part D enrollees, or just over 1 in 4, receive premium and cost-sharing assistance through the Part D Low-Income Subsidy (LIS) program. These additional financial subsidies, also called “Extra Help,” pay Part D premiums for eligible beneficiaries, as long as they enroll in stand-alone PDPs designated as premium-free “benchmark” plans, and reduce cost sharing. For the first time since Part D started in 2006, more LIS enrollees are in MA-PDs (6.8 million) than in PDPs (6.0 million) (Figure 3). Reflecting overall trends in Part D enrollment, the share of LIS enrollees in stand-alone PDPs has declined over time, from 87% in 2006 to 47% in 2021, while the share in MA-PDs has increased, from 13% in 2006 to 53% in 2021 (Table 1).

As part of increased enrollment in MA-PDs, more than one quarter of all LIS enrollees (26%) are now enrolled in Medicare Advantage Special Needs Plans (SNPs), up from only 4% in 2006. SNPs limit enrollment to beneficiaries with certain characteristics, including those with certain chronic conditions (C-SNPs), those who require an institutional level of care (I-SNPs), and those who are dually enrolled in Medicare and Medicaid (D-SNPs), which account for the majority of SNP enrollees.

Monthly Part D premiums have decreased somewhat in recent years; the 2021 weighted average premium for drug coverage is 3 times larger for PDPs than for MA-PDs

In 2021, the weighted average monthly premium for PDPs is $38, a 7% reduction (-$3) from a high of $41 in 2018 (Figure 4). The average monthly PDP premium amount has decreased somewhat in recent years, and has remained within a few dollars of the 2021 average since 2010. For MA-PDs, the monthly premium for the Part D portion of covered benefits averages $12 in 2021 (and $21 for Part C and Part D benefits combined). The average premium for drug coverage in MA-PDs is lower than the average premium for PDPs due in part to the ability of MA-PD sponsors to use rebate dollars (which may include bonuses) from Medicare payments for benefits covered under Parts A and B to lower their Part D premiums. The combined weighted average Part D premium across both types of plans is $26 in 2021, a reduction of roughly 20% (-$6) from 2018, driven largely by a decrease in the Part D portion of the monthly MA-PD premium.

The moderation of growth in the average Part D premium in recent years is likely related to changes in the Part D benefit that have reduced plan liability, in particular, an increase in the manufacturer coverage gap price discount on brand-name drugs from 50% to 70% in 2019, which has led to a reduction in plan liability for brand-name drugs during the coverage gap phase. Lower plan liability helps constrain total costs, enabling plans to lower their bids and, therefore, premiums. The average premium reduction among MA-PDs specifically is related to both an increase in the availability of zero premium plans and the reduction in plan liability for brand-name drug costs during the coverage gap phase.

Most Part D enrollees in 2021 (51% of PDP enrollees and 87% of MA-PD enrollees) are in plans offering enhanced benefits, which can include a lower (or no) deductible, reduced cost sharing, or a higher initial coverage limit than under the standard benefit design. The weighted average premium in 2021 for enhanced benefit PDPs is $44, which is roughly 40% higher than the monthly premium for PDPs offering the basic benefit ($32).

The average Part D deductible has increased for PDPs, while decreasing for MA-PDs; the 2021 weighted average annual drug deductible is 3.5 times larger in PDPs than in MA-PDs

In 2021, a large majority of PDP enrollees (86%) are in plans that charge a deductible, with nearly two-thirds (64%) in PDPs that charge the standard amount of $445 in 2021. Conversely, less than 1 in 5 MA-PD enrollees (18%) are in plans that charge the standard Part D deductible, and nearly half (47%) are in plans that charge no drug deductible. These enrollment patterns explain the wide divergence between PDPs and MA-PDs in the enrollment-weighted average Part D deductible amount. For PDPs, the average Part D deductible in 2021 is $350, 3.5 times larger than the average drug deductible in MA-PDs ($102) (Figure 5).

The increase in the weighted average Part D deductible for PDPs was particularly steep between 2019 and 2020, when two national PDPs modified their plan design from charging no deductible to charging a partial or full deductible in all or nearly all regions. Charging a full or partial deductible provides plans with an additional lever to reduce their liability, particularly for those enrollees who have relatively low total drug costs, and keep premium growth in check. Conversely, MA-PDs have more leverage to reduce Part D premiums because of rebate dollars from Medicare, and with the majority of MA-PDs offering enhanced benefits, they are more likely to have lower or no deductibles than PDPs.

Most Part D enrollees pay less than $10 for generic drugs, but many pay $40-$100 (or coinsurance of 40%-50%) for brand-name drugs; a larger share of MA-PD enrollees than PDP enrollees pay the maximum 33% coinsurance for specialty tier drugs

Most Part D enrollees face relatively low cost sharing for preferred generic drugs, but higher amounts for generics not on the preferred tier. One-half of Part D enrollees (both PDP and MA-PD enrollees) pay $0 for preferred generics in 2021, but many pay $10 or more per prescription for generics that are not on the preferred tier (Figure 6). For preferred generics, 56% of PDP enrollees and 45% of MA-PD enrollees have a $0 copayment, while 44% of PDP enrollees and 51% of MA-PD enrollees face prescription copayments greater than $0 but less than $6. For generic drugs that are not on the preferred generic tier, most PDP enrollees (86%) pay less than $10, while more than half of MA-PD enrollees (60%) pay between $10 and $20. (We did not compare which specific drugs are covered on each tier in PDPs and MA-PDs, which would also influence enrollees’ out-of-pocket costs.)

For non-preferred drugs, most MA-PD enrollees face copayments while most PDP enrollees face coinsurance; for preferred brands, copayments are more common than coinsurance for enrollees in both types of plans. For preferred brands, 57% of PDP enrollees pay monthly copayments less than $45, while 69% of MA-PD enrollees pay $45 to $47. For drugs on the non-preferred tier (which can be all brands or a mix of brands and generics), virtually all PDP enrollees pay coinsurance between 25% and 50% in 2021, while most MA-PD enrollees (83%) pay copayments between $90 and $100. The maximum cost-sharing amount permitted by CMS is $47 or 25% for preferred brands and $100 or 50% for non-preferred drugs in 2021.

A larger share of MA-PD enrollees than PDP enrollees face the maximum 33% coinsurance rate for specialty tier drugs. For specialty tier drugs, defined by CMS as those that cost at least $670 per month, a much larger share of MA-PD enrollees than PDP enrollees are in a plan that charges the maximum 33% coinsurance (54% vs. 14%), while a much larger share of PDP enrollees than MA-PD enrollees are in a plan that charges the minimum 25% coinsurance (66% vs. 7%). Only those plans that waive some or all of the standard deductible are permitted to set the specialty tier coinsurance rate above 25%. Most PDP enrollees are in plans that charge the standard $445 deductible in 2021, while most MA-PD enrollees are in plans that charge either no or a lower deductible.

With increased attention to the global need for COVID-19 vaccines and the Biden administration’s announcement today about how it plans to distribute the first portion of the 80 million doses it will share by the end of this month, the latest KFF Health Tracking Poll finds that two-thirds of the public (66%) say that the U.S. should play at least a “major role” in distributing COVID-19 vaccines to other countries, including about a quarter (27%) who say it should play a “leading role.”

Nearly 9 in 10 Democrats support the U.S. taking at least a “major role” (87%), while most Republicans (57%) say the U.S. should play a “minor role” or “no role at all,” a larger share than the 41% who want the U.S. to play a “leading” or “major role.”

The shares who say the U.S. should take at least a major role increase when people are told that the U.S. has enough COVID-19 vaccine to help other countries without hurting its own supply (78%), that the pandemic is much worse in other countries and they need access to the vaccines to stop its spread (77%), or that providing vaccines to other countries could help the U.S. achieve the immunity necessary to curb the pandemic (76%). After hearing each of these messages, at least half of Republicans say the U.S. should take a leading or major role in vaccine distribution overseas.

The poll also gauges the public’s health policy priorities, and finds large shares of the public consider each of nine proposals tested as “top” or “important” priorities for Congress.

This includes at least 8 in 10 who say so about allowing the federal government to negotiate lower prices directly with drug makers (92%), expanding Medicare coverage to include hearing aids, dental and vision coverage (90%), placing a limit on out-of-pocket costs that seniors have to pay each year for things like prescription drugs (88%), and continuing efforts to make sure U.S. residents are able to receive a COVID-19 vaccine (81%).

Other priorities for Congress include expanding public health coverage for low-income people in states that have not expanded their Medicaid program (78%), creating a public option to compete with private insurance (71%), or lowering the age of Medicare eligibility (66%).

Democrats are generally more likely than Republicans to prioritize each of these health issues as priorities for Congress. The policies aimed at addressing drug costs are the only ones that majorities of Democrats, independents, and Republicans identify as “top” priorities.

When asked directly whether they support or oppose allowing the federal government to negotiate with drug makers to reduce prices for both Medicare and private insurance, the vast majority of the public (88%) is in favor. The poll suggests those views could change in a national debate with arguments being made for and against the approach.

Support inches higher (to 90%) when the public hears that people could save money on their prescription drugs if this policy were implemented. On the flip side, nearly two thirds (65%) say they oppose such a policy after being told that “it could lead to less research and development of new drugs” or that “it could limit people’s access to newer prescription drugs.” These arguments are similarly effective with Democrats and Republicans.

Other findings include:

• The COVID relief law enacted in March provides additional financial assistance to people who buy their own health insurance through the Affordable Care Act’s marketplace. Few (7%) of those who could be eligible for this assistance are aware of this fact.
• Far more continue to view the Affordable Care Act favorably (53%) than unfavorably (35%). This reflects a huge partisan divide, with most Democrats (85%) and a narrow majority of independents (54%) viewing it favorably, and most Republicans (77%) viewing it unfavorably.
• Larger majorities, including most Republicans, view both Medicare (78%) and Medicaid (74%) favorably.

Designed and analyzed by public opinion researchers at KFF, the KFF Health Tracking Poll was conducted from May 18-25 among a nationally representative random digit dial telephone sample of 1,526 adults. Interviews were conducted in English and Spanish by landline (248) and cell phone (1,278). The margin of sampling error is plus or minus 3 percentage points for the full sample. For results based on subgroups, the margin of sampling error may be higher.

Introduction

Current data suggest significant racial disparities in COVID-19 vaccinations, with higher vaccination rates among White people compared to Hispanic and Black people as of late May, based on available state-reported data. The Biden administration has identified equity as a key priority in its national COVID-19 response strategy. One action the administration is pursuing to advance equity in vaccinations is to increase distribution through community health centers. Health centers are a primary source of care for low-income populations and people of color and served nearly 30 million patients in 2019. Given health centers’ focus on underserved communities and their long-standing role in encouraging and providing immunizations, health centers are generally seen as trusted providers in their communities, especially among people of color.

The Health Center COVID-19 Vaccine Program began allocating vaccines directly to an initial group of 250 health centers in mid-February. The early participants in the program serve large volumes of specific high-need populations that may require more resource-intensive vaccination efforts, such as agricultural workers, people living in or near public housing, individuals with limited English proficiency, and people experiencing homelessness. By April 7, 2021, the program expanded to include all health centers nationwide (roughly 1,400 health center organizations), with participation phasing in over several weeks.  Although roughly 800 health centers were participating as of May 24, the majority of vaccinations administered by health centers so far have been supplied by states and local jurisdictions, which are also working with health centers to speed up equitable distribution of the vaccine. Between the doses supplied through the Health Center COVID-19 Vaccination Program and through state and local partnerships, health centers had administered more than 10 million doses of the COVID-19 vaccine by May 2021.

This analysis examines the extent to which vaccination efforts through community health centers are reaching people of color based on data from weekly surveys of health centers administered by the Health Resources and Services Administration (HRSA). We use cumulative weekly data starting January 8, 2021 (when health centers began reporting vaccinations in the survey) and ending May 21 (the most recent data available). We also provide information on first doses administered and second/final doses administered. Notably, the Johnson & Johnson vaccine is only reported as the second/final dose administered in the weekly survey, as it is completed in a single dose. Additionally, this analysis compares community health center survey data to national vaccination data reported by the CDC, total population data, and total community health center patient population data. (See the methods section for more information about the data underlying this analysis.)

Key Findings

Among those with known race/ethnicity information, people of color made up the majority of people who received vaccinations at community health centers between January 8 and May 21, including 64% of people receiving the first dose and 61% of people receiving the second/final dose of the vaccine. Hispanic people made up 34% of first doses and 32% of second/final doses administered by health centers, followed by Black people (12% and 11% of first and second/final doses, respectively), and Asian people (11% for both first and second/final doses). People identifying with more than one race, as well as American Indian and Alaska Native (AIAN) and Native Hawaiian and Other Pacific Islander (NHOPI) people each made up 5% or less of those receiving first and second/final doses (Figure 1). Race/ethnicity was unknown or not reported for about 16% of both first doses administered and second/final doses administered, resulting in gaps in the data. However, health center vaccination data are considerably more complete than national vaccinations reported by the CDC, which are missing race/ethnicity information for 43% of people receiving 1 or more vaccinations and 39% of people who are fully vaccinated as of May 25, 2021.

Weekly data show that the share of first doses administered to people of color at health centers has grown from 34% in early January to 77% in the week ending May 21 (Figure 2). Growth in the share of people receiving the first dose who were Hispanic was especially rapid, growing from 17% of vaccinations to as much as 52% in the week ending May 7 (then declining slightly to 48% in mid-May). Asian people have also accounted for a growing share of the first doses administered, growing from 3% in early January to 10% in the week of May 21. Black people have experienced a modest increase in their share of first doses, growing from 9% in early January to 11% in the week of May 21. Additionally, the number of vaccinations at health centers reported through the survey has increased since January, although vaccinations appear to have reached their peak in April and has since declined, similar to national trends. The number of vaccinations administered per health center responding to the survey has grown from 60 total doses per responding health center during the week of January 8 to peak at 980 during the week ending April 9. Data for most recent week ending May 21 shows 554 total doses per health center responding to the survey. While the rate of overall vaccinations at health centers has slowed since the peak in April, health centers appear to be focusing greater shares of vaccinations on communities color.

The data suggest that people of color represent greater shares of vaccinations at health centers compared to their shares of vaccinations nationally based on data reported by the CDC (Figure 3). For example, Hispanic people accounted for 34% of those who have received their first dose through a health center as of May 21, while they made up 14% of people who received 1 or more doses administered nationally as of May 25. Similarly, 12% of people who received their first dose through health centers were Black, while Black people made up 9% of those who received 1 or more doses nationally. Asian people also appear to be receiving vaccinations in greater shares at health centers compared to their share nationally, making up 11% of first doses administered at health centers vs 6% nationally. Overall findings were similar for second/final doses administered at health centers. However, the ability to draw strong conclusions from these comparisons is limited by differences between the data as well as gaps in the CDC data, including the high share of vaccinations with unknown race/ethnicity and a relatively high share of people reporting multiple or other race.

Health centers appear to be vaccinating people of color at similar or higher rates than their shares of the total population, but data suggest there remain opportunities for health centers to reach more Black patients (Figure 3). Health centers reached particularly large shares of Hispanic and Asian people relative to their shares of the total population, while the share of vaccinations that went to Black people was comparable to their share of the population. These vaccination patterns largely mirror health centers’ larger role serving patients of color, who made up 63% of patients in 2019. Although Hispanic and Asian peoples’ shares of vaccinations were generally similar to or greater than their shares of the health center patient population, the shares of first and second doses administered to Black people through health centers (12% and 11%, respectively) were lower than their shares of the patient population (19%), suggesting remaining opportunities for them to reach greater shares of Black people.

Looking Ahead

Health centers’ role in vaccine distribution is a major part of ongoing efforts to address the racial disparities in COVID-19 vaccinations that have emerged, especially for Hispanic people. The KFF COVID-19 Vaccine Monitor from April 2021 shows that 22% of vaccinated Hispanic adults and 10% of vaccinated Black adults reported getting their vaccine at a community health center. Reflecting their larger role serving and established trusted relationships with communities of color, evidence to date indicates that health centers are vaccinating larger shares of people of color compared to overall vaccination efforts. Health centers are also administering the vaccine to larger shares of people of color than their shares of the population, and there has been a substantial uptick in the share of people of color vaccinated at health centers over time. While people of color make up the majority of health center vaccinations, data suggest that there are further opportunities for health centers to reach more Black people, as the share of Black people vaccinated through health centers is still lower than their share of the health center patient population.

The growth in the share of people vaccinated in health centers who are people of color likely reflects several factors, including improvements in community outreach, logistics, and efforts to address access barriers faced by many people of color, as well as continued increases in people’s willingness to receive the vaccine over time. The Health Center COVID-19 Vaccine Program has increased the share of vaccinations distributed to people of color as well, although data are relatively limited on the program. According to federal officials, approximately 70% of the allocated doses have been administered to people of color.

Although health centers appear to be advancing equitable access to vaccinations, the number of vaccinations administered by health centers remains relatively small when scaled to the national total reported by the CDC. As of May 21, 2021, health centers had reported a cumulative 11.5 million doses (6.2 million first doses and 5.3 million second/final doses) administered in weekly surveys. However, this is likely an undercount, as between 56% and 81% of health centers have responded to weekly surveys, and those that do not respond are not included in the total vaccination counts for the week. Despite a likely undercount, health center vaccinations represent a fraction of the 288 million doses administered nationally as of May 21 and in comparison to the nearly 30 million health center patients in 2019. Still, health centers have focused the majority of their vaccinations within communities of color, especially in recent weeks, even as the number of vaccinations nationally have begun to slow since April 2021. Health centers’ continued involvement in vaccination and outreach efforts at the federal, state, and local levels will likely be a meaningful step in reaching people of color in greater numbers and advancing equity over the long term.

President Biden released his full FY 2022 budget request to Congress on May 28, 2021 (an initial, topline discretionary FY 2022 budget proposal was released on April 9, 2021). The request includes an increase of almost $1 billion for global health programs, most of which (84%) is for global health security. Almost all other global health program areas were level-funded in the request, with the exception of small increases for maternal and child health (MCH) and family planning/reproductive health (FP/RH) compared to FY 2021 enacted levels. This marks a break from President Trump’s requests, which had proposed significant cuts to most global health programs throughout his term (Congress rejected those cuts). The FY 2022 budget request includes funding for U.S. global health programs at the State Department, the U.S. Agency for International Development (USAID), the Centers for Disease Control and Prevention (CDC), and the National Institutes of Health (NIH). Details on additional funding in these and other departments/agencies is not yet known but will be provided, when available. Key highlights for the known amounts are as follows (see table for additional detail). In addition, for an overview of historical trends in U.S. funding for global health, see our new analysis.

State Department & USAID:

Funding for global health programs through the Global Health Programs (GHP) account, which represents the bulk of global health assistance, totaled $10.05 billion, an increase of $855 million (9%) from the FY21 enacted level, almost all of which was for global health security.

• Funding for global health security totals $905 million, an increase of $715 million (376%) above the FY21 enacted level ($190 million).
• Bilateral HIV funding through the President’s Emergency Plan for AIDS Relief (PEPFAR) is $4.7 billion, matching the FY21 enacted level. In FY21, Congress appropriated an additional $250 million in emergency supplemental funding to address the impact of COVID-19 on bilateral HIV programs; this funding is not included in this analysis.
• The request includes $1.56 billion for the U.S. contribution to the Global Fund to Fight AIDS, Tuberculosis and Malaria (Global Fund), matching the FY21 enacted level. In FY21, Congress appropriated an additional $3.5 billion in emergency COVID-19 supplemental funding to the Global Fund; this funding is not included in this analysis.
• Funding for tuberculosis (TB) totals $319 million, matching the FY21 enacted level.
• Funding for malaria totals $770 million, matching the FY21 enacted level.
• The request includes $880 million for maternal and child health (MCH), a slight increase of $24 million (3%) above the FY21 enacted level ($856 million), all for bilateral MCH programs. Other specific areas under MCH include multilateral contributions to:
  • Gavi, the Vaccine Alliance which totals $290 million, matching the FY21 enacted.
  • UNICEF which totals $139 million, matching the FY21 enacted level.
• Funding for the nutrition program totals $150 million, matching the FY21 enacted level.
• Bilateral family planning and reproductive health (FP/RH) funding totals $584 million ($550 million through the GHP account and $33.7 million through the ESF account)[i], a slight increase of $9 million (2%) above the FY21 enacted level ($575 million, of which $524 million was through the GHP account and $51.1 million was through the ESF account). Funding for multilateral contributions to the United Nations Population Fund (UNFPA) totals $56 million, $23.5 million (72%) above the FY21 enacted level ($32.5 million)
• Funding for the vulnerable children program totals $25 million, matching the FY21 enacted level.
• Funding for neglected tropical diseases (NTDs) totals $103 million, matching the FY21 enacted level.
• Funding to replenish the Emergency Reserve Fund, which is used to “quickly and effectively respond to emerging infectious disease outbreaks,” totals $90 million; in FY21, no funding was appropriated for the Emergency Reserve Fund, but Congress provided the authority to transfer up to $50 million in funding from other areas to the Emergency Reserve Fund if needed.

Centers for Disease Control and Prevention (CDC): Funding for global health provided to the CDC totals $698 million, an increase of $105 million (18%) above the FY21 enacted level ($593 million), almost all of which (95%) is to support global health security activities; all other areas remained flat except for parasitic diseases funding which increased slightly.

National Institutes of Health (NIH) [ii]: Funding for global HIV/AIDS at NIH totals $617 million, essentially flat compared to the FY21 enacted level ($616 million). Funding for the Fogarty International Center (FIC) at NIH totals $96 million, $12 million (15%) above the FY21 enacted level ($84 million).

Resources:

• White House FY 2022 Budget Resources
• State/USAID FY 2022 Congressional Budget Justification
• CDC FY 2022 Congressional Budget Justification
• NIH FY 2022 Congressional Budget Justification

The table (.xls) below compares global health funding in the FY 2022 request to the FY 2021 enacted funding amounts as outlined in the  “Consolidated Appropriations Act, 2021” (P.L. 116-260; KFF summary here). Note that total funding for global health is not currently available as some funding provided through USAID, Health and Human Services (HHS), and the Department of Defense (DoD) is not yet available.

See the KFF budget tracker for details on historical annual appropriations, including Senate and House amounts, for global health programs.

[i] The FY22 request funding amounts are based on a bilateral total of $583.7 million as specified in the FY22 OMB Budget Appendices for the Department of State and Other International Programs.

[ii] While funding for global research activities at NIH is not yet known, the agency overall got a significant increase ($9 billion or a 21% increase, from approximately $43 billion in FY21 to $52 billion in the FY22 request).