Finally, after three decades of frustrated federal attempts, President Joe Biden and Congress have stood up to lobbying by Big Pharma – and taken sweeping action to provide millions of Americans with meaningful relief from the chronically unreasonable cost of prescription drugs. .
This fundamental first step comes in major legislation signed by Biden last week that also invests nearly $400 billion in clean energy subsidies and extends health care assistance first provided during the COVID-19 pandemic. 19.
It’s an achievement worth reporting, no matter where we are in the election cycle or who comes up. There was a clear popular consensus of support, which makes this measure a sign that the government is really tackling a real problem.
The $2,000 per year cap on out-of-pocket drug costs for seniors and other Medicare beneficiaries offers the most tangible highlight. This takes effect in 2025. As it stands, enrollees had to shell out about $7,000 in prescriptions before qualifying for what’s called catastrophic coverage.
For the first time, the Department of Health and Human Services can negotiate, from a position of strength, the pharmaceutical prices charged to the Medicare program, which is expected, according to most responsible estimates, to reduce by $288 billion. program costs until 2031.
COMPROMISES WERE NECESSARY
Democrats have rightly taken a skeptical view of sweeping threats from influential industry that it would hamper the research and development of new drugs. Yes, political compromises were needed to do so as a fiscal “reconciliation” measure – the only way to get the votes needed to pass against the monolithic Republican opposition.
Because of these strategic concessions, however, the timing and scope of the legislation seem understandably frustrating to many who have backed it as the best of all possible deals.
Many of its important benefits will not take effect immediately. Instead, they will be phased in over the next few years. The first “negotiated” prices are expected to affect 10 essential Medicare Part D medicines starting in 2026, followed by 15 more in 2027, 15 more in 2028 and 20 more in 2029.
To qualify for price negotiation – or restriction as some call it – a product will need to be on the market for several years. Companies that raise prices faster than inflation, meanwhile, will have to pay Medicare a rebate, and those that violate the rules face fines.
All this will sound, for the ordinary citizen, well drawn but also too gradual. These are the elderly people we are talking about, many of whom do not have the luxury of waiting for this kind of help.
Just as sadly, the changes are written for 64 million Medicare enrollees, but not for the 150 million Americans on commercial insurance from their employer. The bill’s sponsors wanted to give the same break to people enrolled in private insurance programs, but the Senate parliamentarian said it couldn’t be considered budget reconciliation. And presenting it as ordinary legislation would have required the votes of GOP members — who made it clear they would not cooperate, perhaps for fear of handing the Democrats the win.
For now, analysts disagree on whether the Medicare change could inspire lower costs for everyone — or whether it will spur companies to raise costs where they can. elsewhere and, if so, by how much. No one can predict with certainty how the industry, with its high marketing costs, will react. Whatever their game, however, the government should not become passive again on Big Pharma prices. He should find ways to protect everyone. Americans shouldn’t pay more than people in other relatively high-income countries, yet we do.
ACTION ON INSULIN
Insulin has been the star product in public calls for help and sanity in drug pricing. Diabetics need it to survive – and past abuse has become a national disgrace. That’s why eight states have their own insulin regulations. This includes New York where, starting last year, the price was capped at $100 for a 30-day supply for those enrolled in state-regulated commercial health plans.
Starting next year, the new law will limit the cost of insulin for Medicare beneficiaries to $35 per month. The American Diabetes Association reports that approximately 8.4 million Americans are insulin dependent these days.
The bill also extends expanded pandemic subsidies for insurance policies provided under the 12-year-old Affordable Care Act, which the Biden administration says has enabled 13 million people to recover. save an average of $800 a year.
Welcoming the signing as a historic breakthrough, AARP Executive Director Jo Ann Jenkins said, “We will continue to advocate for additional measures to bring down the price of prescription drugs. . . Our fight is not over.
The challenge and way forward for policymakers is pretty clear: expand on the progress now established for Medicare enrollees by finding a way to negotiate prices for other insurance customers.
In the meantime, perhaps the timeline for implementing these desirable changes can be accelerated in some way. After all, Medicare itself was created the year after President Lyndon Johnson asked Congress to create it. It’s been a good effort so far – at least on one side of the aisle – but haven’t people been waiting long enough?
EDITORIAL BOARD MEMBERS are experienced journalists who offer reasoned, fact-based opinions to encourage informed debate on the issues facing our community.