New Medicare Part D law info

I have been puzzled about the new law (expected to be passed on Friday) since intercst said that the $2,000 max drug part was “BS.”

Here’s the actual information.

https://www.nytimes.com/2022/08/10/us/politics/prescription-…

**Beginning next year, insulin co-payments for Medicare recipients would be capped at $35 a month. As of 2024, those with costs high enough to qualify for the program’s “catastrophic coverage” benefit would no longer have to pick up 5 percent of the cost of every prescription. And starting in 2025, out-of-pocket costs for prescription medicines would be capped at $2,000 annually....** [end quote]

Because this is so important, I double-checked it.

https://www.aarp.org/politics-society/advocacy/info-2022/med…

**Part D changes**

**For the first time, out-of-pocket costs for Part D prescription drugs would be capped. Starting in 2025, beneficiaries would not have to pay more than $2,000 a year for their share of Part D drugs.**

**Beginning in January, most vaccines would be free in Medicare.**

**Part D premiums could not increase more than 6 percent a year through at least 2029. The income threshold for beneficiaries to qualify for a subsidy to help pay for Part D out-of-pocket costs would be increased from 135 percent of the federal poverty level ($18,347 for an individual in 2022) to 150 percent ($20,385 for an individual in 2022).**

**Negotiating drug prices**

**The Health and Human Services secretary would be authorized to begin negotiating the prices of 10 high-cost prescription drugs in 2023, and the negotiated prices would go into effect in 2026 for Medicare Part D medications and 2028 for drugs covered under Medicare Part B. The number of drugs whose prices would be negotiated on behalf of Medicare would increase in subsequent years, and by 2029 a total of 60 drugs would be subject to negotiated prices.** [end quote]

It appears that the $2,000 maximum is NOT BS, although we will have to wait until 2025. It would be on all drugs, not only catastrophic coverage.

And the revocation of 5% payment on catastrophic coverage drugs is also significant since many cancer drugs are astronomically expensive.

I remember trenchrat, who died of cancer, writing, “The money melts away like ice cream on a hot sidewalk.”

The new bill will be a huge relief to patients. By the same token, it will be very expensive for the federal budget.

Wendy

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It appears that the $2,000 maximum is NOT BS, although we will have to wait until 2025. It would be on all drugs, not only catastrophic coverage.

I hope that’s correct and I’ll believe it when I see it. They can get to a $2,000 max out of pocket cost in a number of ways.

Maybe the current $480 deductible before the insurance kicks in becomes $1,980?

Or they just jack up the prices on generic drugs even more? (Remember, if you buy your drugs with a GoodRx coupon or through Mark Cuban it doesn’t count towards your Part D deductible. You have to pay the inflated insurance company prices to get credit towards your $2,000 deductible. You might be paying $2,000 for a bottle of aspirin. )

One thing I’m pretty sure of based on 30 years of history, is that the drug companies and health insurers aren’t going to lose any money and excessive Executive Compensation will continue apace.

intercst

The new bill will be a huge relief to patients. By the same token, it will be very expensive for the federal budget.

Nope. They’re saying it’s going to save Medicare money, which tells me that the $2,000 out-of-pocket limit will be funded by the Medicare beneficiaries themselves with a higher level of price gouging in generic drugs.

intercst

"The new bill will be a huge relief to patients. By the same token, it will be very expensive for the federal budget.

Wendy"


Would you care to wager?

Howie52

Perhaps this will be different than every other medical-related legislation I have lived
through and watched what occurred to regular families. I somehow doubt there will
be any “great leaps forward”.
Great leaps tend to end in head-first landings.

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Starting in 2025, beneficiaries would not have to pay more than $2,000 a year for their share of Part D drugs.

I hope it is true. However, it depends how they define “pay more than…their share”.

Is it using the current system to determine how much is paid? Or a much different one, which could be actual “cash out” paid by the recipient.

Trulicity is $900-$1000 per four weeks (one shot every week using a box of 4 pens). Co-pay is $10. So people taking that drug will hit the max within two months–or not if just the co-pay ($10/mo) is used.

And this is not counting any another drug (which is likely with diabetes, cancer, etc). Again, how/which cost is used for the calculation makes a huge difference.

THAT has major macro impacts on a significant number of people (on Medicare or not).

Maybe just pay Medicare a monthly pharma fee of $167 (= $2000/12) and then everyone gets full pharma coverage for a year at no additional cost.

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Maybe just pay Medicare a monthly pharma fee of $167 (= $2000/12) and then everyone gets full pharma coverage for a year at no additional cost.

The only way the insurance industry makes money off Medicare is to slice and dice the patient population into smaller and smaller groups and pit them against each other. The only reason Americans are OK with paying double the price for a health care system that kills us 3 years sooner than other large nations is because minorities and other “unworthies” are suffering even more. Making everyone pay the same Part D fee is “socialism” and a “business killer”.

About 90% of prescriptions filled by seniors are for generic drugs. And if you’re using GoodRx, Mark Cuban, etc., rather than your Part D insurer, you’re buying those generic drugs at a big discount.

If you’re going to give everyone a $2,000 annual limit on out-of-pocket costs, still give people access to $500,000/yr name-brand medications, and have Medicare subsidize Part D by less (i.e., Medicare is saving money), one or more of three things have to happen.

  1. Name brand drugs become wildly less expensive (not likely with a bought & paid for Congress.)

  2. Part D insurers reduce their “skim” (again, not likely with a bought & paid for Congress.)

  3. Fund the $2,000 out-of-pocket limit with an even higher level of generic drug price gouging to make up the cost of giving the most expensive 1% of the Medicare population a $2,000 out-of pocket limit.

I direct you to this pitch deck from Kaiser Family Foundation outlining the $300 Billion, 10-year cost saving (3rd slide from the end.)

https://www.kff.org/slideshow/what-are-the-prescription-drug…

It’s just arithmetic, you either jack up the premiums for Part D (which will result in a higher percentage of “healthy” seniors opting out), or you hide the cost in a greater level of generic drug price gouging and hope few people notice and do the calculation of whether Part D coverage is worth it, and opt out.

It’s a bet on the innumeracy of the Medicare population. Likely a sound one for drug companies and insurers.

intercst

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By the same token, it will be very expensive for the federal budget.

Don’t “We the People” own the Budget?

The Captain