Starting in 2025 CMS (Centers for Medicaid and Medicare) will require all Medicare Part D plans to offer enrollees the option to pay out-of-pocket prescription drug costs in the form of a capped monthly installment payments to the plan instead of all at once at the pharmacy. This is part of the changes to Part D of Medicare due to the Inflation Reduction Act that was passed in 2022.
This program is available for all Part D enrollees, however only a small portion will likely benefit from participation. Those “likely to benefit” are those who hit a $600 single prescription threshold or those that have high Out-of-Pocket costs for medications totally $2,000 or more. Members can voluntarily opt into the program prior to or at any time during the plan year. Once opted into the program, the member will pay $0 at point of sale and will be sent a monthly bill. The Part D plans will administer the program and be responsible for the launch and maintenance costs of the Prescription Payment plan. Plans can terminate members from the program (not the plan) for failure to pay. Part D Plans cannot disenroll members from the plan for failure to pay outstanding Out-of-Pocket costs and cannot decline future enrollment into a Part D plan based on an individual’s failure to pay a monthly amount billed under the program. Plans also must provide a grace period of at least 2 months when an individual has failed to pay the billed amount by the payment due date.
