Increase in Medicare Part D Beneficiaries Affected by Insurer Withdrawals Sparks Concern

A recent study highlights a significant rise in the number of Medicare Part D beneficiaries impacted by insurance companies exiting the marketplace. The research, conducted by experts at Mass General Brigham and published in JAMA, reveals that between 2024 and 2025, approximately 2.9 million Medicare recipients lost their Part D coverage due to insurer withdrawals. This represents a notable surge compared to the previous six years, during which only 0.1% to 2.3% of beneficiaries experienced such cancellations annually.

The Inflation Reduction Act (IRA), enacted to improve prescription drug affordability and include measures like a $2,000 annual out-of-pocket cap for seniors, has also raised concerns about insurer stability. While the law succeeded in making drugs more affordable for many, it appears to have inadvertently contributed to increased insurer exits. Senior author Dr. Benjamin N. Rome pointed out that although the reforms aimed to enhance the program, unexpected insurer withdrawals could cause disruptions for millions relying on consistent medication coverage.

Analysis of data from the Centers for Medicare & Medicaid Services from 2018 through 2024 revealed that the percentage of beneficiaries losing their insurer in subsequent years saw a dramatic jump in 2024, with 7.5% experiencing coverage loss compared to less than 3% in prior years. This increased churn may challenge patients' ability to find new plans and maintain medication adherence, potentially affecting health outcomes.

Experts warn that decreased insurer competition might lead to fewer choices and higher costs for patients over time. They suggest that Congress may need to intervene by adjusting regulatory limits, such as lowering the annual deductible cap from $590 or considering the introduction of a public Part D option to promote healthier competition and improve stability in the market.

The findings underline the importance of monitoring insurer stability and implementing policies to protect beneficiaries from coverage disruptions, especially as reforms continue to reshape Medicare’s landscape.