Alzheimer’s drug cited as medical insurance premium jumps $21.60

Alzheimer’s drug cited as medical insurance premium jumps $21.60

Washington Medicare Part B outpatient insurance premiums will jump $21.60 per month in 2022, one of the biggest increases ever. On Friday, officials said a new Alzheimer’s drug was responsible for about half of that.

The increase ensures that Medicare will eat up a large portion of the recently announced Social Security cost-of-living allowance, an increase of up to $92 a month for the average retired worker, intended to help cover the rising gas and food prices that nix seniors.

Medicare officials told reporters Friday that about half of the increase is due to contingency planning if the program will eventually cover Aduhelm, the new $56,000-a-year Alzheimer’s drug from pharmaceutical company Biogen. The drug will add to the cost of outpatient coverage because it is given intravenously at the doctor’s office and paid for under Part B.

The issue turns into a case study of how a single expensive drug for a condition plaguing millions of people can alter its role in government spending and affect family budgets. People who don’t have Alzheimer’s won’t be protected from the cost of Aduhelm, because it’s big enough to affect their insurance premiums.


Officials said the premium for the new Part B will be $170.10 per month for 2022. The jump of $21.60 is the largest increase ever in dollar terms, though not in percentage terms. As recently as August, the Medicare Trustees report expected an increase of $10 less than the current $148.50.

β€œThe increase in the 2022 Part B premium is ongoing evidence that rising drug costs are threatening the affordability and sustainability of the healthcare program,” Medicare Chiquita President Brooks Lachure said in a statement. Officials said the other half of the increase is due. For the natural growth of the program and the adjustments Congress made last year as the coronavirus pandemic spread.

The announcement comes late Friday afternoon β€” a time period government agencies use to drop bad news β€” as Congress considers Democratic legislation backed by President Joe Biden that would limit Medicare payments for drugs. However, under the latest settlement, Medicare will not be able to negotiate prices for the newly launched drugs. News about health insurance premiums could reopen this debate internally among Democrats.


“Today’s announcement…underscores the need for Congress to finally give Medicare the ability to negotiate lower prescription drug costs,” Rep. Frank Balloni, DNJ, said in a statement. “We simply cannot wait any longer to bring real relief to seniors.” Ballon was a supporter of the original House version of the legislation, which took a tougher approach to the pharmaceutical industry.

Alzheimer’s disease is a progressive neurodegenerative disease with no known cure, affecting about 6 million Americans, the vast majority of whom are old enough to qualify for Medicare.

Aduhelm is the first Alzheimer’s drug in nearly 20 years. It doesn’t treat a life-threatening condition, but the Food and Drug Administration has determined that its ability to reduce plaque clumps in the brain likely slows dementia. However, many experts say the benefit has not been clearly demonstrated.

Medicare has begun a formal evaluation to determine whether it should cover the drug, and a final decision isn’t likely until at least spring. Currently, Medicare decides on a case-by-case basis whether to pay for Aduhelm.


Cost is not traditionally included in Medicare coverage decisions. But in this case, there is also a lot of controversy about the effectiveness of Aduhelm. Last November, an FDA advisory panel voted almost unanimously against recommending approval, citing flaws in the company’s studies. Several members of the committee resigned after the Food and Drug Administration approved the drug anyway due to their objections.

A nonprofit think tank focused on drug pricing has pegged Adulhelm’s actual value at $3,000 to $8,400 a year — not $56,000 — based on its unproven benefits.

But Biogen defended its pricing, saying it has carefully considered the costs of advanced drugs to treat cancer and other conditions. The company also says it expects a gradual absorption of the Alzheimer’s drug, not a “hockey stick” scenario in which costs kick in. However, Medicare officials told reporters that they should plan for emergencies.


Two House committees are investigating Aduhelm’s development, including communications between company executives and FDA regulators.

Medicare covers more than 60 million people, including those 65 and older, as well as people who are disabled or have serious kidney disease. Program spending is approaching $1 trillion per year.

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