If Senate Democrats can pass a reconciliation bill.
What Medicare drug reform could mean to seniors.
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The reason Arizona Democrat Kyrsten Sinema is holding out on the reconciliation bill, even as Senator Tom Manchin announced his support, is to get rid of a proposed tax on venture capitalists.
God, she is an asshole.
If Biden and the Democrats can’t get Sinema on board, there are not enough Democrats to pass it and there are no Republicans who will vote for it.
If passed the bill could save older people like me a ton of money for prescription drugs. It is one of the benefits in the bill.
That we all are depending on one senator, bought off by hedge fund managers and venture capitalists, is criminal.
The prescription drug provisions in the Senate reconciliation legislation would reduce the federal deficit by $288 billion over 10 years according to the Congressional Budget Office. And it would also reduce out-of-pocket spending by Medicare beneficiaries and limit increases in drug prices for Medicare and private insurance. The provisions would be implemented over several years beginning in 2023.
Even if the Democrats can pass the bill, Part D drug pricing reform would take seven years to be fully implemented.
Do I need to point out that many of us beneficiaries may not have seven years?
The federal government was kept from negotiating drug prices when Congress passed a Medicare bill in 2003 and George Bush was President.
Some of the fiercest debate was focused on a section of the bill that prohibited the government from negotiating lower drug prices for the 40 million people on Medicare.
Instead, Medicare was forced to rely on insurance companies and private health plans to manage the new drug benefit. They could negotiate with drug companies, but the government, with much greater purchasing power, was forbidden to.
This bill would end that ban of government bargaining drug prices.
The Kaiser Family Foundation estimates that the legislation would hugely reduce out-of-pocket spending for so many Medicare beneficiaries:
Eliminates the 5% coinsurance requirement above the Medicare Part D catastrophic threshold in 2024 and adds a $2,000 cap on Part D out-of-pocket spending in 2025, along with other Part D benefit design changes. In 2022, the catastrophic threshold is set at $7,050 in out-of-pocket drug costs, which includes what beneficiaries themselves pay and the value of the manufacturer discount on the price of brand-name drugs in the coverage gap (sometimes called the “donut hole”), which counts towards this amount. Under current law, beneficiaries who use only brand-name drugs in 2022 have to spend about $3,000 out of their own pockets (rising to around $3,500 in 2025) before qualifying for catastrophic coverage, and then face 5% coinsurance. CBO estimates the Part D benefit design changes would increase federal spending by $25.1 billion over 10 years.
1.3 million Medicare Part D enrollees without low-income subsidies had spending above the catastrophic coverage threshold in 2020 (the most recent data available), which was $6,350 that year, and would be helped by the elimination of the 5% coinsurance requirement above the catastrophic threshold. (See Table 1 for state-level estimates)
1.4 million Medicare Part D enrollees without low-income subsidies had annual out-of-pocket drug spending of $2,000 or more in 2020 and would be helped by the proposed $2,000 hard cap on out-of-pocket drug spending. This group includes the 1.3 million enrollees without LIS who had spending above the catastrophic threshold in 2020. (See Table 1 for state-level estimates)
These estimates of how many beneficiaries could be helped by these changes are conservative because they do not account for expected increases in average annual out-of-pocket spending since 2020 that would increase the number of beneficiaries with spending above the catastrophic threshold or above $2,000.
Capping out-of-pocket drug spending under Medicare Part D would be especially helpful for beneficiaries who take high-priced drugs for conditions such as cancer or multiple sclerosis. For example, in 2020, among Part D enrollees without low-income subsidies, average annual out-of-pocket spending for the cancer drug Revlimid was $6,200 (used by 33,000 beneficiaries); $5,700 for the cancer drug Imbruvica (used by 21,000 beneficiaries); and $4,100 for the MS drug Avonex (used by 2,000 beneficiaries).
We’re waiting on Krysten Sinema.
That’s crazy.