Weekly Update for Week Ending September 26, 2020

Weekly Update for Week Ending September 26, 2020

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.

Our nation is in a hyper-partisan period as the November elections approach.  In this environment it becomes tricky when reporting about issues that affect you and other TSCL supporters because the issues are so often intertwined with politics.

We want to assure you that we will try to report the facts as we understand them and keep elective politics out of it.


Don’t Bet on $200 Drug Discount Card Just Yet

As part of a press conference last week President Trump announced that some seniors    “will soon receive a card in the mail containing $200 that they can use to help pay for prescription drugs.”  He added that the cards “will be mailed out in coming weeks.”

However, according to one report a White House official said the idea of a drug discount card was a “last-minute thing that is still being worked out.”

In his announcement the President did not give any specifics about how the government would pay for the cards or which of the nation’s Medicare recipients would receive it. White House officials estimated the price tag would be about $7 billion.

A report in Politico, a Washington, D.C., based newspaper, pointed out that, “Congress also hasn’t authorized spending money on the cards. Administration officials at a briefing Friday morning did not tell senior congressional staff about what pots of money would be tapped to launch the effort, though one former administration official with knowledge said the Medicare trust fund is a likely target.”

The Politico report also pointed out that, “It’s not the first time that a president has tested his power ahead of an election to make a sweeping health care change.

“Barack Obama bypassed Congress to reward top-performing private Medicare plans ahead of his re-election campaign. The plan to provide bonus payments sparked Republican-led congressional investigations, and watchdogs at the Government Accountability Office called on the Obama administration to shut it down. The program ended in 2014.”

Last week we told you that the Trump administration will soon announce its plan to allow states to import some prescription drugs from Canada.   We also said that drug makers are objecting to this policy and are expected to sue the federal government if it is put in place, claiming it violates both the U.S. Constitution and federal laws.

In the same press conference where he announced the drug discount card, President Trump and his administration has issued a final rule that clears the way for Florida and other states to implement the drug importation program from Canada.

But it does not allow states to import biologic drugs, including insulin.

The new drug importation plan must be run through the states.  Florida is one of six states to pass laws seeking federal approval to import drugs.

The Canadian government has made known its objections to the policy.  It says the Canadian drug industry is too small to provide prescription drugs for both its own citizens and for the U.S. market.

It also has stated it will do whatever is necessary to safeguard the availability of drugs for Canadians.  Resistance on the part of Canada is very important because many who have studied the situation believe that without cooperation by the Canadian government, the drug importation plan would fail.

The drug importation plan is projected to eventually save the Medicare Trust Fund significant dollars that would otherwise be used to help extend the solvency of Medicare.  Now, instead of that, those funds would apparently be used to pay for these new drug discount cards.

The process for implementing Presidential executive orders is a complicated one but this drug importation rule will not be in effect for at least 60 days, making it late November, at the earliest.  But states will still have to set up a system for importation and the drug companies could still sue to stop the program.  If there are no lawsuits, it still seems likely that the earliest Florida and the other states could begin importing drugs would be well into next year.

All of this uncertainty is why we tell you not to count on receiving these drug discount cards anytime soon, if ever.  The reality is that the funds to pay for these discount cards do not exist, and it remains unclear whether they will in the future.

While TSCL supports any plan to help seniors cover their medical expenses, we believe the most important thing that must be done is to shore up the Medicare Trust Fund and make sure it is solvent well into the future.  Unfortunately, there is no plan in existence at this time to do that, nor has anyone from either party proposed one.  That must be on the top of the agenda in Washington next year.

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Medicare Advantage Premiums Projected to Decrease

Last week the Department of Health and Human Services (HHS) released its projected average premium costs for 2021.  It shows that average 2021 premiums for Medicare Advantage plans are expected to decline 34.2 percent from 2017 while plan choice, benefits, and enrollment continue to increase and that Part D premiums will be down 12 percent from 2017, with over 1,600 drug plans offering insulin at no more than $35 per month.

Beneficiaries can expect Medicare Advantage average monthly premiums of about $21 next year. That is down roughly 11% from $23.63 in 2020. Meanwhile, the average number of plan choices per county will jump from 39 to 47 next year.

HHS is hoping that Medicare Advantage plans will woo beneficiaries from fee-for-service Medicare, where it believes costs can spiral because patients and providers have incentives to overuse and provide too many services. Medicare Advantage plans receive a set payment to cover each enrollee’s projected cost of care whether or not medical care is provided.  Medicare Advantage plans are part of the HHS effort to transform fee-for-service Medicare into a program that rewards quality care rather than the amount of treatment caregivers provide.

In 2021, beneficiaries with kidney failure can enroll in a Medicare Advantage plan for the first time. Average “Part D” Medicare prescription drug premiums will be roughly $30.50 in 2021.

The Center for Medicare and Medicaid Services (CMS) expects to update Medicare.gov with the 2021 Medicare Advantage and Part D premiums and cost-sharing information in early October.

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Hearings this week on Drug Prices

Rep. Carolyn B. Maloney (D- N.Y.), the Chairwoman of the Committee on Oversight and Reform, announced that the Committee will hold two days of hearings with top executives of major drug companies to examine their pricing practices for some of the costliest drugs in the United States.  The hearings, titled “Unsustainable Drug Prices:  Testimony from the CEOs,” will be on Wednesday, September 30, and Thursday, October 1, at 10 a.m.

“These companies sell medications that are critical to our health and well-being, but their skyrocketing prices are simply unsustainable,” Chairwoman Maloney said.  “For nearly two years, our Committee has aggressively investigated why drug companies continuously increase prices, how they use their massive profits, and what steps can be taken to make prescriptions more affordable for the American people.  I look forward to hearing from these CEOs next week as we work to make drug prices more affordable for the American people.”

Current law prohibits Medicare from negotiating directly with drug companies for lower prices.  Last December, the House of Representatives passed H.R. 3, the Elijah E. Cummings Lower Drug Costs Now Act, which would give Medicare the authority to negotiate.  However, the legislation has not been taken up by the Senate.

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For progress updates or for more information about these and other bills that would strengthen Social Security and Medicare programs, visit the Bill Tracking section of our website or follow TSCL on Twitter.