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Health Reform will LOWER the Costs of Prescriptions for Seniors

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An article in today's NY Times by Robert Pear reports that health reform will actually help decrease total prescription drug spending for Medicare beneficiaries.  I wanted to write on highlights of the article because so much misinformation is circulating about how Medicare will change and how reform will affect seniors.

Pear's article was based on a Congressional Budget Office (CBO) report that stated that individual premiums for prescriptions may increase ,but the total spending for a beneficiary will fall.  CBO also said that drug-related provisions of the House bill would save the federal government $30 billion from 2010 to 2019.  AARP even endorses that health reform will lower drug costs for seniors.

The proposed health reform legislation would drop drug spending in two ways.

1. It will require drug companies to provide larger discounts on medication dispensed to low-income people eligible for both Medicare and Medicaid.

2. It would also require drug makers to provide a 50 percent discounts on brand-name drugs for beneficiaries experiencing the "doughnut hole" until the coverage gap is eliminated.

It should be noted, that those who use a relatively small amount of prescription drugs would pay more in additional premiums than they would save.  While those who use a large amount of drugs would gain more from eliminating the "doughnut hole" than they would pay in higher premiums.

Reform of Medicare Part D (which deals with all the prescription drug coverage) attempts to protect Medicare beneficiaries who are the sickest (those needing the most number of medications) and most financially at risk (eligible for both Medicare and Medicaid).

Sounds right to me.

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  1. redshirt4


    I am a doctor in Augusta, GA in private practice. I can’t support HR3200 nor a so called public option. I’m afraid the Pres. is using doctors from DFA for political gain and doesn’t have our interests (putting patients first) genuinely at heart. I believe that we need to empower patients, not the government as HR3200 is specifically designed to do. Bureaucracy is an incredibly inefficient way to do health care financing. I believe a program with significant financial incentives for Americans to opt for individual HSAs and HDHPs are the best tools to hold down costs, increase value, and bring true accountability back into the doctor-patient relationship. Breaking down the barriers to allow more competition among insurance carriers to enter all markets and compete for those HDHPs is a needed reform, not creating a government plan to compete with private insurance. Finally, the single most important step is that we as physicians need to get out of the banking, filing, and billing morass. We as doctors must bring in fee-for-service across the board and force patients to do the haggling with the carriers/payers for reimbursement. If our patients really knew what was going on, things would change, but they are insulated by a combination of third party payers, whose only interest is holding down payouts from themselves to providers regardless of the consequences to the patient, and secondly, our willingness to do the filing for the patients and accept 25-75% of charges as payment in full. What other industry is successful with that business model. As far as the uninsured, I will be happy to continue to see means-tested, destitute, truly-needy patients pro-bono if I am allowed to write it off my taxes against income generated. Significant TORT reform is the final key plank to any meaningful health care financing reform. NONE of these reforms would cost the American taxapayer one single dime!

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