ShareThis Page
Congress mulls cap on what Medicare enrollees pay for drugs | TribLIVE.com
Politics/Election

Congress mulls cap on what Medicare enrollees pay for drugs

Associated Press
| Sunday, February 24, 2019 1:30 a.m
796083_web1_796083-6f7d3078115845029e62e494ab291216
AP
Retired public school teacher Gail Orcutt, of Altoona, Iowa, looks over some of the prescription drugs she takes, Friday, Feb. 15, 2019, in Altoona, Iowa. Orcutt pays $2,600 the first month of the year, and then $750 every other month for a lung cancer medication. With health care a top issue for American voters, Congress may actually be moving toward doing something this year to address the high cost of prescription drugs.
796083_web1_796083-e3da41856c4b42be95afc2e515c49d89
AP
Retired public school teacher Gail Orcutt, of Altoona, Iowa, holds some of the prescription drugs she takes, Friday, Feb. 15, 2019, in Altoona, Iowa. Orcutt pays $2,600 the first month of the year, and then $750 every other month for a lung cancer medication. With health care a top issue for American voters, Congress may actually be moving toward doing something this year to address the high cost of prescription drugs.
796083_web1_796083-70cfdb354aba47fd897c2f1321df221f
AP
Retired public school teacher Gail Orcutt in her home, Friday, Feb. 15, 2019, in Altoona, Iowa. Orcutt pays $2,600 the first month of the year, and then $750 every other month for a lung cancer medication. With health care a top issue for American voters, Congress may actually be moving toward doing something this year to address the high cost of prescription drugs.
796083_web1_AP19055810258272
How much Medicare beneficiaries spend out-of-pocket on prescription drugs.

WASHINGTON — With health care a top issue for American voters, Congress may actually be moving toward doing something this year to address the high cost of prescription drugs.

President Trump, Democrats trying to retire him in 2020, and congressional incumbents of both parties all say they want action. Democrats and Republicans are far apart on whether to empower Medicare to negotiate prices, but there’s enough overlap to allow for agreement in other areas.

High on the list is capping out-of-pocket costs for participants in Medicare’s popular Part D prescription drug program , which has a loophole that’s left some beneficiaries with bills rivaling a mortgage payment.

The effort to cap out-of-pocket costs in Medicare’s prescription plan is being considered as part of broader legislation to restrain drug prices.

Limits on high medical and drug bills are already part of most employer-based and private insurance. They’re called “out-of-pocket maximums” and are required under the Obama-era health law for in-network services. But Medicare has remained an outlier even as prices have soared for potent new brand-name drugs, as well as older mainstays such as insulin.

“The issue has my attention,” said Sen. Charles Grassley, R-Iowa, chairman of the Senate Finance Committee, which oversees Medicare. “Out-of-pocket costs are a concern of ours, particularly at the catastrophic level.” His committee has summoned CEOs from seven pharmaceutical companies to a hearing Tuesday.

While Grassley said he hasn’t settled on a specific approach, the committee’s top Democrat, Oregon Sen. Ron Wyden, recently introduced legislation that would cap out-of-pocket costs at about $2,650 for Medicare beneficiaries taking brand-name drugs. One co-sponsor is Minnesota Sen. Amy Klobuchar, a Democratic presidential candidate.

In Des Moines, Iowa, retired special education teacher Gail Orcutt is battling advanced lung cancer because of radon exposure. Although she has Medicare prescription coverage, she paid $2,600 in January for her cancer medication and will pay about $750 monthly for the rest of the year. She said it cost more last year for a different drug — $3,200 initially and then about $820 monthly.

Someday her current drug may stop working, said Orcutt, and then she’d have to go on a different medication. “What if that is two or three times what I’m paying now?” she said. “It’s not sustainable. The country needs more problem-solving for the common good and not the corporate bottom line.”

At a recent House Ways and Means Committee hearing, three expert witnesses with varied policy views concurred on limiting drug costs for Medicare beneficiaries. “This is still the only program that does not provide that protection to its beneficiaries,” testified economist Joe Antos of the business-oriented American Enterprise Institute. The House committee also oversees Medicare.

Before the hearing, the committee’s chairman and top Republican released a joint statement unusual in polarized times: “We agree that the time is now to take meaningful action to lower the cost of prescription drugs in the U.S. health care system,” said Reps. Richard Neal, D-Mass., and Kevin Brady, R-Texas.

John Rother of the National Coalition on Health Care is a longtime participant in national health care debates, and his organization represents a cross-section of interest groups. “There is a common recognition of a problem, and also a sense that they want to move something this year,” he said.

At issue is the Medicare prescription benefit’s “catastrophic” protection. Experts say it was intended as a safeguard but isn’t working that way, either for beneficiaries or taxpayers.

Catastrophic protection was enacted before the advent of drugs costing $1,000 a pill. It kicks in after beneficiaries have spent about $5,100 on medications, under a complex formula.

After that, the beneficiary is only responsible for 5 percent of the cost of the medication, and taxpayers’ share rises to 80 percent. The patient’s insurer covers the remaining 15 percent.

The problem for beneficiaries is that there’s no dollar limit to what they must pay. For example, 5 percent of a drug that costs $200,000 a year works out to $10,000.

Numerous experts also say there’s a problem for taxpayers.

Generally, the Medicare prescription benefit is financed with a mix of government subsidies and beneficiary premiums. But in the catastrophic portion, most of the bill is passed directly to taxpayers. That neutralizes the incentive for insurers to negotiate lower prices with drugmakers. Catastrophic is the fastest growing cost for Medicare’s Part D.

The administration has supported an approach recommended by experts that would shift most of the responsibility for high-cost medications onto insurers, while capping what beneficiaries must pay. That would force insurers to seek lower prices. But it may well raise premiums.

About 3.6 million Medicare beneficiaries with Part D coverage — or 9 percent — had “catastrophic” costs in 2015, according to the nonpartisan Kaiser Family Foundation. Of those, about 1 million had to pay their share in full because they didn’t qualify for financial assistance provided to low-income beneficiaries.

“This affects people with serious conditions such as cancer and multiple sclerosis,” said Tricia Neuman, a Medicare expert with Kaiser. “People on Medicare can still face huge expenses for their medication because the Medicare drug benefit was designed without a hard cap on out-of-pocket costs.”

Categories: News | Politics Election
TribLIVE commenting policy

You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.