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Submitted by Lew Nyman August 22, 2023

Medicare Part B Premiums: Recent approval by the Food and Drug Administration (FDA) of a new treatment for early stage Alzheimer’s disease may increase Medicare Part B premiums in 2024.

Medicare announced plans to cover Leqembi following its July 6 FDA approval. The drug reportedly will cost $26,500 a year, and with premiums set to cover about a quarter of program costs, it’s likely Medicare users would see Part B costs for 2024 higher than the $174.80 standard monthly premium predicted by Medicare’s board of trustees in their March report.

A different Alzheimer’s medication, Aduhelm, was part of the reason behind a 15% Part B premium jump from 2021 to 2022, according to the nonprofit health policy research organization KFF. Medicare later decided to limit coverage of that drug to patients in official clinical trials, significantly reducing the number of covered beneficiaries and leading to the first Part B year-over-year premium decrease in more than a decade.

KFF estimates annual Medicare spending on Leqembi would be $2.7 billion based on drugmaker Eisai’s estimates, which would rank the drug third on the covered-medication cost list.

The new drug is not mentioned in the Medicare trustees’ report from March, which included these estimates for Medicare’s standard monthly premium in future years:

bullet2024: $174.80
bullet2025: $185.00
bullet2026: $196.40
bullet2027: $210.60
bullet2028: $224.30
bullet2029: $240.10
bullet2030: $253.40
bullet2031: $268.80
bullet2032: $285.60

Medicare beneficiaries with around $100,000 or higher in a Medicare-specific form of Modified Adjusted Gross Income (married couples filing a joint tax return have a different income scale) pay an adjusted rate for Part B coverage by adding an Income Related Monthly Adjustment Amount (IRMAA) to the standard premium.

The five IRMAA brackets, which are adjusted annually for inflation, usually are announced in late September. Note: The income levels used by Medicare to determine the 2024 rate will be from 2022 tax returns, unless a lower amount is requested in connection with a life-changing event.

NDAA: A few days ago both the House and Senate passed their respective versions of the FY2024 defense authorization bill.

From the topline figure to key details on pay and benefits, including TRICARE coverage, the versions passed by the House and Senate have significant differences to resolve when lawmakers from both chambers return to Washington, D.C., in September.

The Senate FY24 NDAA calls for $886 billion in accordance with a debt ceiling deal, while the house version calls for $875 billion. Lawmakers on both sides of the aisle and in both chambers painfully acknowledge DoD has not passed an audit and are committed to ensuring an audit is completed for improved oversight of spending taxpayers’ dollars. A tough negotiation is expected in the conference given the lower topline number in the House NDAA.

Here are some highlights:
bullet5.2% Pay Raise. While you won’t find it in the legislative text of either the House or Senate version, Congress supported the pay raise by keeping it tied to the Employment Cost Index – a key MOAA priority. The defense appropriations bill may seek to address pay table reform.
bulletBasic Needs Allowance (BNA). MOAA prefers the House language, which removes the Basic Allowance for Housing (BAH) from BNA eligibility calculations to ensure families struggling with food insecurity have access to this needed benefit. The Senate bill extends the authority of service secretaries to determine high-cost areas or "a demonstrated need" in the implementation of the BNA.
bulletCONUS COLA. The Senate included a provision to increase access to the CONUS cost-of-living allowance (COLA) for servicemembers stationed in high-cost areas. Currently, the rate is paid when a servicemember or their family is in an area where non-housing expenses are 8% over the national average. The Senate language would reduce it to 5%.
bulletFamily Separation Allowance. The House bill contains a provision increasing Family Separation Allowance II (FSA-II) from $250 per month to $400 per month. FSA-II was raised to $250 in 2004 and hasn’t been adjusted since. This payment provides a vital source of income to help families offset additional costs when their servicemember is away.
bulletHousing. The House version would authorize $200 million more than requested by the administration to improve housing and barracks. Both chambers included the establishment of a Military Housing Readiness Council to provide enhanced oversight and more consistent engagement with stakeholders.