Medicare Pays More for Drugs than Medicaid
Last week the Congressional Budget Office (CBO) released a report that revealed Medicare outpatient plans are three times more expensive for the same drugs as those covered by Medicaid.
According to Bloomberg News, “Budget officials analyzed prices of 176 popular brand name drugs and found the price for a 30-day supply of medication was $118 on average through Medicaid and $343 through Medicare Part D, which pays for prescription drugs in retail pharmacies. The government also paid twice as much on the same drugs through Medicare versus the Veterans Affairs program.”
The report found similar price disparities in expensive specialty drugs that treat complicated conditions like cancer.
Why does that happen?
Again, according to Bloomberg News, “Manufacturers have to offer Medicaid plans their lowest possible price under federal regulations in order to participate in other federal drug programs, which is likely why the Medicaid prices are so low.”
In addition, the Secretary of Health and Human Services (HHS) is prohibited from negotiating directly with pharmaceutical companies on behalf of the more than 40 million Americans who get their prescription drug coverage from Medicare Part D.
The Senior Citizens League strongly believes allowing the HHS Secretary to negotiate with the drug companies is one important way to reduce the costs of drugs for seniors. We will be continuing our efforts to get Congress to pass legislation that would make this possible.
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Legislation to Control Drug Prices Possible This Year?
Given the above story about how Medicare users pay so much more for drugs than Medicaid users, could this be the year we finally win?
According to an article in The Hill, a Washington, D.C., newspaper that covers legislative matters in Congress, it just might happen.
Last year the House of Representatives, led by Speaker Nancy Pelosi (D- Calif.), passed major drug legislation that would have allowed the government to negotiate directly with the drug companies, thus bringing the prices of drugs down. The major drug companies, and then-Senate Majority Leader Mitch McConnell (R-Ky.), opposed the legislation and would not allow the House-passed legislation to even be considered.
There was also a bipartisan proposal from Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.) that gained support in the Senate but it did not include price negotiation, and again, McConnell refused to bring the bill to the floor in an election year.
However, price negotiations could be included later this year in a reconciliation bill, a fast-track budgetary move that only needs 51 votes to pass the Senate and cannot be blocked using a filibuster.
The Democrats are likely to use reconciliation to move President Biden’s COVID-19 relief measure through Congress while sidestepping a GOP filibuster.
The new effort could be part of a second package later this year and TSCL will closely examine the legislation once it is finally developed to see if it accomplishes our goals and whether we can support it.
As TSCL supporters well know, Congress has not been able to accomplish significant legislative reform to the convoluted drug pricing system even though anger about high drug prices has been rising for a long time.
With reconciliation, Democrats can pass a bill without any Republican votes so they are hoping to get a much more comprehensive bill than the Grassley-Wyden one.
However, the pharmaceutical industry has spent billions of dollars over the years fighting this kind of legislation and passing it will not be easy.
According to The Hill, the legislation would, “… completely change the way the U.S. pays for drugs, saving the federal government more than $456 billion over 10 years, according to an analysis by the nonpartisan Congressional Budget Office (CBO).
“The bill has been fiercely opposed by Republicans and the branded pharmaceutical industry, which would likely lose revenue if the bill passed, leading to 40 fewer new drugs coming to the market in the U.S. over the next two decades, according to the CBO estimate.
“But Democrats arguing for the change are pointing to rising costs of brand-name drugs and insurance plans that increasingly require patients pay more money toward their own care, forcing them to ration insulin and other drugs. They also note that H.R. 3 includes $10 billion for biomedical research.”
We want to reiterate here that TSCL is a non-partisan organization and we work with any member of Congress and both political parties when they support legislation that we believe is in the best interest of America’s seniors.
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More Veterans Could Get Covid-19 Vaccinations
There is a misconception that all veterans can get health care through the Department of Veterans Affairs. But that is not true. To get health care there a veteran must have a VA-rated disability.
TSCL has many veterans among its supporters and no-doubt not all of them have a disability rating so they may be happy to know that Congress is considering including them in the VA’s Covid-19 vaccination efforts.
Last week House Appropriations Military Construction-VA Chair Debbie Wasserman Schultz (D-Fla.) pushed a Department of Veterans Affairs official at a hearing to work on a plan to offer coronavirus vaccines to veterans even if they are not eligible for VA health care.
VA officials are talking to other agencies about expanding the availability of vaccines at VA facilities, Richard Stone, acting under secretary for health at the Veterans Health Administration, said. Limited supply has forced the department to prioritize veterans who are currently enrolled to receive vaccines, though in some cases they have managed to immediately enroll eligible veterans on the spot, Stone said.
TSCL supports allowing any veteran to get the Covid vaccine at the VA and we will keep an eye on the progress of this effort.
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Despite the coronavirus emergency, TSCL is continuing its fight for you to protect your Social Security, Medicare, and Medicaid benefits. We have had to make some adjustments in the way we carry on our work, but we have not, and will not stop our work on your behalf.
For progress updates or for more information about these and other bills that would strengthen Social Security and Medicare programs, visit the our website or follow TSCL on Twitter.
