En español | The addition of a prescription drug benefit to Medicare in 2006 has helped keep millions of older Americans from having to choose between putting food on the table or buying medicine. But 12 years later, prescription prices continue to skyrocket, and many 50-plus consumers still face that choice.
The average retail price of a prescription drug taken to treat a chronic condition has reached $13,000 per year. That’s more than three times what it was when the landmark drug legislation was passed, and it’s about four-fifths of the average annual Social Security retirement benefit. How much a Medicare beneficiary has to pay out of pocket for that medication can vary greatly, depending on what drug plan he or she has.
As candidates for Congress and state offices campaign for this fall’s midterm elections, they should know that high prescription drug costs weigh on voters’ minds. In a Kaiser Family Foundation poll this spring, lowering prescription drug prices topped respondents’ list of priorities. The survey also revealed that more than 80 percent of Americans say Congress is not doing enough to solve this problem.
“There’s no reason we should be paying the highest drug prices in the world,” says Megan O’Reilly, AARP director of health and family. And, in a letter to the U.S. Department of Health and Human Services, Joyce Rogers, AARP senior vice president for government affairs, says: “It is critical that any proposals to lower prescription drug costs don’t simply shift the costs around in the health care system without addressing the root problem: the prices set by pharmaceutical companies.”
Electing the right people in November is crucial to lowering drug prices, says David Mitchell, founder of Patients for Affordable Drugs. “We should be looking for candidates who are willing to stand up to the entire drug industry,” says Mitchell, who has an incurable blood cancer. “The stories I hear are heartbreaking. People say they have to skip doses, cut their pills in half, empty their 401(k). One woman on Medicare ran up credit card debt to pay her share of her medicine costs and then had to refinance her house. The system is not serving patients and consumers right now. The system is serving the people who make money off it.”
Here are ways high drug prices can be addressed by the next crop of federal and state legislators:
Policy experts say the solutions to high drug prices have been clear for years. Top of their list is giving Medicare the power to negotiate with pharmaceutical manufacturers. “As the largest purchaser of prescription drugs, the federal government should be able to leverage that purchasing power to get better prices for beneficiaries,” O’Reilly says.
AARP is among the groups that are fighting for lower prices by allowing the safe importation of less expensive drugs. Proposals supported by AARP include allowing the purchase of prescription drugs from countries like Canada or members of the European Union.
Advocates say competition also would increase if older Americans had better access to lower-cost generic drugs. For example, the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act would prevent drug manufacturers from blocking the development of affordable generics. Some brand-name companies thwart generic manufacturers by refusing to give them the samples of the drug they need to prove to the U.S. Food and Drug Administration that the generic equivalent is just as good. The CREATES Act would allow generics companies to sue brand-name manufacturers to get those samples. So far, neither the Senate or the House has voted on that measure, which has bipartisan support.
As part of a federal budget deal early this year, Medicare Part D prescription drug beneficiaries with high medicine bills will get some financial relief. That’s because the so-called donut hole — or coverage gap — will close in 2019 instead of 2020, and drug companies will pick up more of the costs. This gap starts once a beneficiary has spent a certain amount of money on medicines in a year. At that point, he or she must pay more for prescriptions until reaching an annual out-of-pocket threshold. The pharmaceutical industry has been lobbying to change the deal that would close the gap. AARP has been urging congressional leaders to protect the cost-saving donut hole fix and it’s possible that this issue could resurface in Congress.
AARP also supports two bills introduced in the Senate that would ban so-called gag orders that prevent pharmacists from letting consumers know when they could get a medicine cheaper by buying it without using their insurance.
For years, prescription drug prices have increased at rates that are many times higher than inflation. AARP and others are calling on Congress to require drug manufacturers to explain why they price their products so high and why those prices increase so much over time. AARP believes patients also deserve to know how much taxpayer-funded research went into developing a drug and how much manufacturers spent on advertising compared to research and development. AARP supports the FAIR Drug Pricing Act, which would require greater price transparency.
According to the National Conference of State Legislatures, 25 states have enacted measures making pharmacy gag clauses illegal. Others have passed bills to improve pricing transparency. For example, California now requires drug companies to give two months’ notice when they plan to significantly increase the price of a drug. And Nevada enacted a measure that requires manufacturers of diabetes medicines to provide information on why they are increasing prices.
Wednesday, Apr 24, 2019 at 1:00pm
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