CBO: ObamaCare will increase prescription plan premiums 20%

(By Ed Morrissey, Hot Air) - The White House wants to cure the “doughnut hole” problem in Medicare Part D by closing the gap between coverage limits and caps on out-of-pocket expenses. Expanding the coverage means hiking premiums on seniors enrolled in the program, though, a condition that the Obama administration and its allies in Congress have not yet revealed. CBO directer Douglas Elmendorf outlined the projected fee hikes in a letter to Rep. Dave Camp, the ranking Republican on the House Ways and Means Committee:

Overall, CBO estimates that enacting the proposed changes would lead to an average increase in premiums for Part D beneficiaries, above those under current law, of about 5 percent in 2011. That effect would rise over time and reach about 20 percent in 2019. Beyond the 10-year budget window, the premiums would increase slightly more until the doughnut hole was eliminated in 2022; beyond that point, enrollees’ premiums would grow along with the cost for covered drugs. As already noted, the proposed changes would also reduce beneficiaries’ average cost sharing and their average total drug spending. The net effect on drug spending would differ among beneficiaries depending on the amount of their purchases in a year.