Problem: Seniors continue to pay far too much for prescriptions.
Solution: Close Medicare Part D “Donut Hole” and allow Medicare to negotiate drug prices.
The Affordable Care Act—otherwise known as Obamacare or the ACA—ensured that millions of Americans could enroll in affordable private insurance. But for seniors who have access to Medicare, their primary concern is not coverage but cost. Specifically, the cost of medical coverage and prescription drugs.
Cost is an especially relevant concern. Right now, millions of American seniors are weighing their options for Part D and private add-on plans as Medicare’s open enrollment goes until Dec. 7. (Note: Healthcare.gov’s open enrollment goes until Jan. 31, 2016.) So not only are seniors weighing drug plan options and prices, but if a Medicare recipient is going to be in the “donut hole” and forced to pay a lot out of pocket it is far more likely to be at the end of the year too.
A quick refresher: Medicare Part D, signed into law by President George W. Bush in 2003, had two major problems. First, it created a coverage gap known as the “donut hole,” which means that seniors have to pay 100% of the retail cost of prescription drugs until they hit a catastrophic amount. And second, Medicare is not allowed to negotiate better deals on prescription drug prices, unlike Medicaid or the Department of Veterans Affairs.
The Affordable Care Act is working to close the Medicare Part D donut hole. Each year it gets smaller and smaller but it still won’t be fully closed until 2020. But the problem of not negotiating with drug companies remains. And members of Congress like U.S. Sen. Ron Johnson of Wisconsin have specifically worked to keep it that way. But budget-cutters should address this problem, since the Congressional Budget Office estimates that allowing Medicare to negotiate drug prices would save $116 billion over 10 years.
We could help seniors, reduce federal spending and end overpaying prescription drug companies simply and easily. But it won’t happen on its own. To do so we need to go beyond Obamacare and let Medicare negotiate drug prices.
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Kevin Kane is the lead organizer at Citizen Action of Wisconsin and is one of the state’s noted experts on health care reform. The Shepherd ran his series Understanding Obamacare when the ACA was being implemented. The Shepherd and Citizen Action of Wisconsin will answer your questions about Obamacare during the next few weeks. Email your questions to editor@shepex.com.
