Medicare Part D: A First Look at Prescription Drug Plans in 2018

This analysis focuses on the Medicare Part D stand-alone prescription drug plan marketplace in 2018 and trends over time. The analysis includes 20.4 million enrollees in stand-alone PDPs, excluding 4.4 million enrollees in employer-group only PDPs for whom plan premium and benefits data are unavailable.

Data on Part D plan availability, enrollment, and premiums were collected primarily from a set of data files released by the Centers for Medicare & Medicaid Services (CMS) on a regular basis:

• Part D plan landscape files, released each fall prior to the annual enrollment period. These files include basic plan characteristics, such as plan names, premiums, deductibles, gap coverage, and benchmark plan status. For this analysis, we used the 2018 PDP Landscape Source files, v-09-22-17, released on September 29, 2017.
• Part D plan and premium files, released each fall. These files include more detail on plan characteristics, including premiums charged to LIS beneficiaries, the portions of the premiums allocated to the basic and enhanced benefits, and the separate drug premiums for MA-PD plans.
• Part D plan crosswalk files, released each fall. These files identify which plans are matched up when a plan sponsor changes its plan offerings from one year to the next.
• Part D contract/plan/state/county level enrollment files, released on a monthly basis. These files include total enrollment by contract and plan at the state and county level. We use September 2017 enrollment counts for enrollment-weighted analysis in this report for 2017 and projected for 2018. Previous years’ data are based on March enrollment files for each year. Enrollment files suppress totals for plans with 10 or fewer enrollees.
• Part D Low-Income Subsidy enrollment files, released once annually (in March for 2017). These files include total enrollment counts for LIS enrollees. As with the other enrollment files, we exclude plans with small enrollment counts in estimates that are plan-enrollment weighted.
• Medicare plan benefit package files, released each fall. These files supply detailed information on the benefits offered by plans, including cost-sharing amounts for each formulary tier, tier labels, and the different cost-sharing amounts for standard and preferred cost-sharing pharmacies, where applicable.
• Medicare penetration files, released on a monthly basis. These files are used to estimate average counts of plans available per beneficiary.

This analysis adopts different methods with regard to the treatment of certain data elements than previously published analysis of the Part D marketplace conducted by the authors. Our previously published analysis used monthly enrollment files by plan rather than the contract/plan/state/county level enrollment files, and imputed a value of five enrollees for suppressed counts for plans with 10 or fewer enrollees (rather than excluding them, as we do in this analysis); for plan/county data, our prior analysis imputed a value of one beneficiary for all plan/county combinations for suppressed counts of 10 or fewer beneficiaries (rather than excluding them, as we do in this analysis).