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Posts Tagged 'Part D'

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President Proposes Allowing Medicare to Negotiate for Lower Rx Drug Prices

“It’s long past time for Congress to acknowledge the hard truth that the sky-rocketing cost of prescription drugs is hurting average Americans and our federal budget. Medicare spends billions providing Part D drug coverage each year while beneficiaries including seniors, the disabled and their families also face rising out-of-pocket costs and higher premiums. All the while, drug makers continue to reap the profits of their price gouging. In his budget, President Obama has again proposed lifting the ban preventing Medicare from negotiating prices with the drug companies. Big Pharma has lobbied hard to keep the ban in place but seniors expect, this time, Congress will do the right thing and finally allow Medicare to negotiate for fair prices.”...Max Richtman, NCPSSM President/CEO

Among the other budget provisions beneficial to seniors include:

  • closing the Part D donut hole two years earlier
  • additional funding for in-home services
  • reforms for overpayments going to private insurers in Medicare Advantage
  • a 7.44% increase in administrative funding for the Social Security Administration

However, the President’s budget was not all good news.  Once again, the budget proposes shifting even more healthcare costs to seniors by extending Medicare means-testing to the middle class and increasing out-of-pocket costs such as the home health care copayment and the Part B deductible. 

“The average Medicare beneficiary already spends nearly $4,800 per year in out-of-pocket health care costs with half of all people on Medicare having incomes of less than $24,150. People in Medicare simply can’t afford increased cost-sharing year-after-year.  What’s especially worrisome are efforts to portray expanding means-testing in Medicare as impacting only ‘high-income seniors.’  While that may be good political rhetoric the truth is, if passed, further means testing will actually target middle-class individuals”...Max Richtman, NCPSSM President/CEO 

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Negotiating for Lower Drug Costs in Medicare Part D

USA Today has a must-read editorial supporting our position that Medicare should be allowed to negotiate with drug-makers for lower prescription drugs, just as the Veterans Affairs department currently does.

“Part D already costs about $80 billion a year and is on track to double by 2022 as benefits improve and Baby Boomers retire. For two reasons, a significant chunk of that money is wasted on overpayments to drug companies: When Part D began, millions of patients were shifted over from Medicaid, the state-federal program for low-income people that gets far lower drug prices than Medicare. Suddenly, the cost of providing drugs to the same people shot up. Congress barred Medicare from negotiating the way Medicaid and the Department of Veterans Affairs do with drug makers to get lower prices. Instead, lawmakers insisted the job be done by private insurance companies.”

The fact that Medicare is forbidden in the law that created Medicare Part D to negotiate lower prices is no accident.  The drug lobby worked hard to ensure Medicare wouldn’t be allowed to cut into the profits which would flow to big Pharma thanks to millions of new customers delivered to them by Part D.  Even some Republican House members (this was a GOP sponsored bill), including Rep. Walter Jones from North Carolina and Rep. Dan Burton from Indiana, were aghast at the whole process:

"The pharmaceutical lobbyists wrote the bill," says Jones. "The bill was over 1,000 pages. And it got to the members of the House that morning, and we voted for it at about 3 a.m. in the morning," remembers Jones.

Why did the vote finally take place at 3 a.m.?

"Well, I think a lot of the shenanigans that were going on that night, they didn't want on national television in primetime," according to Burton.

Unfortunately not much has changed since 2003.  Roll Call has this wrap-up of what drug companies spent during the last quarter alone on lobbying Congress:

Five pharmaceutical companies have reported million-dollar increases in their spending on lobbying the federal government during the first quarter of 2014. Pfizer Inc., Novartis, Johnson & Johnson Services, Bayer Corporation, and Merck & Company have each boosted their lobbying of the executive and legislative branches.

Here are the top pharmaceutical spenders in the first quarter of 2014:

Pharmaceutical Research & Manufacturers (PhRMA) $4,680,000 – up from $4,050,000 in 2013 Q4.

Pfizer Inc. $3,190,000 – up from $2,090,000.

Novartis $2,580,000 – up from $920,000.

Amgen USA Inc. $2,560,000 – up from $2,330,000.

Eli Lilly & Co. $2,086,000 – down from $2,430,000.

Johnson & Johnson Services $2,110,000 – up from $860,000.

Bayer – $2,040,000, up from $1,000,000.

Merck & Co. $2,000,000 – up from $820,000

These are the same companies which claim any attempts to rein in their overpayments in Medicare will kill their research and development of new drugs:

“The drug companies say they must impose higher prices in the U.S. to pay for research that enables them to innovate and develop new drugs that save our lives. But that’s not true. Half of the scientifically innovative drugs approved in the U.S. from 1998 to 2007 resulted from research at universities and biotech firms, not big drug companies, research shows. And despite their rhetoric, drug companies spend 19 times more on marketing than on research and development.”  Healthcare for America Now

Meanwhile, in their opposing USA Today editorial big Pharma also argues that people like Part D so it shouldn’t be changed and, by the way, prescription drugs help people stay healthy.

“Surveys show 90% or more of Part D enrollees are satisfied with their coverage and say it works well. The use of medicines under Part D also helps to reduce spending on other health care services in Medicare, a fact that was recently acknowledged by CBO.”

Of course, access to prescription drugs helps people stay healthy but what does that have to do with whether or not Medicare should be forced to overpay for those drugs? Naturally, seniors like Part D.  Why wouldn’t they when before its passage they had absolutely no drug coverage?  That doesn’t mean Americans support paying more than they, or the government, should in order to pad drug makers’ pockets.  

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More Donut Hole Checks on the Way

CMS has mailed the second round of $250 one-time checks  to seniors who’ve fallen into the Part D donut hole.  80,000 checks are going out this week and ultimately CMS expects about 4 million seniors will qualify for rebates.  These checks are the first step in efforts to eventually close the donut hole through the new health care reform legislation.  

“The Affordable Care Act starts to close the donut hole this year, giving much-needed relief to millions of seniors. In 2011, the Affordable Care Act takes an additional step for Medicare beneficiaries in the donut hole by providing them with a 50 percent discount on their brand name medications. Every year from 2012 until 2020, the Affordable Care Act will take progressive steps to close the donut hole.”  HHS Secretary Kathleen Sebelius.  
Unfortunately, whenever there’s something new in the Medicare program scammers come out of the woodwork. CMS offers this advice: 
“Seniors also need to know that they will just receive their check at their usual address - they don't have to take any extra steps,” said Centers for Medicare & Medicaid Services Deputy Administrator and Director for the Center for Medicare, Jonathan Blum. “And they should never give out their personal information. If someone asks for your personal Medicare information over the phone who isn't a trusted resource like Medicare, please don't provide it. Seniors or family members should contact us at 1-800-MEDICARE to report any of these types of calls or go to to learn more about efforts to fight fraud and scams against seniors.”

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Maryland Senior Talks About the Donut Hole

Fran Garfinkle is a 70-year old retired small business owner and cancer survivor from Bethesda, Maryland. She's among four million seniors who will be trapped in the Medicare Part D coverage gap known as the “donut hole” this year.  Fran has seen first-hand how quickly retirement plans can change when confronted with skyrocketing health care costs, rising premiums and Part D’s flawed “donut hole” provision.  She fell into the donut hole for the first time last summer.

“We scrimped and saved and somehow I managed to find the money to buy the prescriptions I needed last year.  Then this May, I reached the “donut hole” again and the whole nightmare started from the beginning.  Like so many others, my husband and I are on a fixed income.  It’s pretty scary.  We pay for medicare plan, medicare supplement plan, prescription drug plan, dental plan and on top of all the copays, we are now paying 100% of my drug costs because I’m back in the “donut hole”...Fran Garfinkle, NCPSSM volunteer
Fran, a volunteer with the National Committee to Preserve Social Security and Medicare, will be joined by President Obama and Secretary Kathleen Sebelius at a national seniors Tele-Town Hall   event tomorrow.  Participants will talk about the donut hole and provisions in the new health care reform legislation, which will ultimately close the donut hole in addition to making many other improvements to Medicare. 80,000 seniors who’ve already fallen into the donut hole this year will begin receiving the first rebate checks this week to help close their coverage gap.  The $250 checks will continue to go to beneficiaries as more fall into the donut hole throughout 2010. The National Committee to Preserve Social Security and Medicare is committed to providing America’s seniors with updated and detailed analyses of how healthcare reform legislation will affect their medical coverage in Medicare.  In addition to co-sponsoring tomorrow’s Tele-Town Hall event, we’ve released a new web video, “Health Reform and Seniors”, which is being shown during community meetings, town halls and grassroots events.  The video is available on the National Committee’s YouTube Channel . This video supplements the National Committee’s popular newsletter, Secure Retirement, which provides detailed coverage of health care reform in its spring issue.  The publication is in its second printing due to very high demand from seniors nationwide.

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This Check Really is in the Mail

Over eight million seniors each year are trapped in the Part D donut hole --a cruel coverage gap where they pay premiums but get no drug coverage.  It’s a provision only insurers could love and was included in the legislation which created Part D.  Closing that donut hole has been on of our top legislative priorities and one of the most beneficial improvements included in healthcare reform legislation. In just days, the first step in the gradual phase out to close that gap begins.  80,000 seniors who’ve already fallen into the donut hole this year will begin receiving the first rebate checks next week to help close their coverage gap.  The $250 checks will continue to go to beneficiaries as more fall into the donut hole throughout 2010. Donut hole checks will generally be sent out every quarter. Although it is always possible for checks to be delayed, below is the planned schedule for distributing payments: 

If you fall into the "donut hole" by: Your check will likely be sent by :
March 30, 2010 June 10, 2010
June 30, 2010 September 15, 2010
September 30, 2010 December 15, 2010
December 30, 2010 March 15, 2011
We’ve provided more details about the new rebate in a fact sheet on our NCPSSM website. Starting in 2011, people who reach the doughnut hole will receive a 50 percent discount on brand-name drugs. That means the typical senior will save $700 next year thanks to health reform legislation. By 2020, the doughnut hole will be eliminated.  What this reform will ultimately do is put real health care dollars back into the pockets of seniors who need them and not to the insurers who’ve profited for years from this flawed provision.  Check out the CMS brochure  for beneficiaries here.

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