Seniors and patient advocacy organisations have long sought to give Medicare the power to bargain over the cost of prescription drugs.
The government health programme for senior citizens will finally be able to negotiate cheaper prescription drug prices thanks to legislation the U.S. Senate enacted on Sunday and sent to the House. The law also caps Medicare recipients’ out-of-pocket expenses at $2,000 annually.
Advocates for patients praised the law as a victory for seniors who are struggling to pay for soaring prescription drug costs. The Affordable Care Act, the former President Barack Obama’s landmark health law, was passed in 2010, making the proposed plan the most ambitious piece of health legislation since then.
The Affordable Care Act (ACA) increased Medicaid eligibility for low-income Americans and provided private insurance subsidies for millions more people, but it did not address the soaring costs of prescription medications.
Patients like himself have battled hard for a victory with the Democrats’ comprehensive climate and health care policy, known as the Inflation Reduction Act, according to David Mitchell, the creator of Patients For Affordable Drugs Now.
Mitchell told USA TODAY, “It’s a major transformation – a really significant accomplishment.”
Mitchell, who has been battling multiple myeloma for more than ten years, spends more than $16,000 annually on a prescription medicine. He predicted that the $2,000 yearly limit on prescription drug spending would “make a tremendous difference.”
All of these elements will make it easier for millions of Americans to afford the medications they currently use, according to Mitchell.
The bill’s contents
Medicare would be given the authority to haggle over the cost of prescription medications for the first time.
Starting in 2026, Medicare would bargain the price of up to 10 retail medications. By 2029, Medicare’s negotiating position would cover 20 prescription and 20 over-the-counter medications. Over the following ten years, the law is expected to save the federal government $288 billion.
The cost of instituting a $2,000 out-of-pocket cap for senior citizens would be partially offset by those savings. Additionally, the cost of an insulin dose for Medicare enrollees would be restricted at $35. Americans with private health plans will not be subject to this cap as Republicans removed that clause from the final measure.
People who must use pricey prescription medications for illnesses like cancer or multiple sclerosis will profit from the measure. In 2020, the most recent year for which data are available, an estimated 1.4 million Medicare participants spent at least $2,000 on prescription drugs, according to a Kaiser Family Foundation research.
Additionally, the plan would limit medication manufacturers’ ability to drastically raise costs. Drug manufacturers will have to provide rebates starting the following year if their price increases are higher than the rate of inflation.
Additionally, the bill would offer elderly free vaccinations. It extends Affordable Care Act subsidies for younger Americans for an additional three years, to 2025. For those with lower and moderate incomes who directly purchase coverage on federal and state insurance exchanges, this will result in cheaper insurance coverage costs.
Jo Ann Jenkins, CEO of AARP, stated that her organisation has worked for Medicare to be able to negotiate drug pricing for senior citizens for two decades.
The annual cap on the amount seniors must spend out-of-pocket for prescription drugs would provide seniors with peace of mind, according to Jenkins, and this plan will save Medicare hundreds of billions of dollars.
Drug firms have long had the privilege of deciding the prices for the millions of Medicare-eligible seniors.
The measure is a “tragic loss for patients,” according to Stephen J. Ubl, president and chief executive officer of the pharmaceutical industry association Pharmaceutical Research and Manufacturers of America.
American youth are not covered
While seniors would benefit financially from the proposal, younger Americans who purchase their own coverage or are covered by an employer won’t have the same safeguards.
According to James Gelfand, president of the ERISA Industry Committee, which represents large employers that directly offer health insurance and other benefits to employees, employers that provide insurance to more than 150 million Americans are concerned that the prescription drug provisions only apply to Medicare recipients.
The ERISA Industry Committee, which represents sizable firms that directly offer employees health insurance and other benefits, is led by James Gelfand.
The prescription medication rules, according to Gelfand, only apply to Medicare participants, which worries businesses that provide insurance to more than 150 million Americans.
Many people, according to Gelfand, “are gravely afraid that private insurance premiums will just increase to make up for whatever losses there might be in Medicare.”