Seniors seeking relief from the burden of prescription drug prices now have a reason to be hopeful -- just in time for the holidays.
The $200 Medicare drug-discount cards authorized by President Donald Trump earlier this year have cleared an important bureaucratic hurdle.
Last Monday, the program received approval from the Special Interest Group for Inventory Information Approval System Standards -- an industry consortium that oversees the benefit cards on behalf of the Internal Review Service.
The consortium had been hesitant about the legality of the one-time discount, but they ultimately cleared the plan in a decision that will certainly delight America’s seniors.
The first cards are expected to be mailed to seniors on January 1, according to a report from Bloomberg. In total, more than $6.6 billion will be distributed to the roughly 39 million seniors on Medicare. The pre-loaded debit cards can be used on any prescription drug co-payment.
These cards couldn’t come at a better time. According to a survey from healthinsurance.com, almost 90 percent of seniors think prescription drug prices are too high. 36 percent reported spending over $50 a month on prescriptions. Another 66 percent are worried about out-of-pocket costs.
While the one-time benefit card is not a long-term solution, the financial relief could be enough to give seniors some peace of mind knowing they can afford their medication without cutting corners.
The White House first proposed the plan to give each Medicare recipient a $200 benefit card to help pay for prescription drugs in late September as part of its America First Healthcare plan. President Trump later followed through with the proposal, signing an executive order that put the plan into action.
However, delivery of the $200 benefit cards has been delayed, in part, due to legal questions as to whether the president can disseminate them without Congressional approval. As an alternative, a bill in the Senate would have capped out-of-pocket costs on prescription drugs for Medicare recipients. However, that legislation failed to gain steam and stalled, despite bipartisan support. Left with few other promising bills from Congress, the White House opted to move forward with the benefit cards.
The Trump administration has taken several other steps to reduce healthcare costs in the long-term for seniors. In November, the Department of Health and Human Services finalized a rule mandating increased transparency from insurance providers on the out-of-pocket costs of drugs.
As part of the America First Healthcare plan, the administration also took steps to level the playing field between the U.S. and other countries after decades of Americans overpaying for healthcare. One recently finalized rule would allow the U.S. to import drugs from Canada, resulting in what HHS Secretary Alex Azar called a “significant reduction in the cost of covered products to the American consumer.” Additionally, the president signed an executive order that would tie the price of drugs covered under Medicare to the lowest international reference price -- meaning American seniors wouldn't pay more for medications than their European counterparts.
The cost of prescription drugs has been climbing for years. The average American spends $1,025 per year on medications they need to stay healthy. When the average annual spending on prescription drugs is adjusted for inflation, the costs have skyrocketed elevenfold. This isn’t sustainable for any American, but especially not for seniors.
After the uncertainty of this past year, giving seniors some much-needed assistance when it comes to their prescriptions is an excellent way to ring in 2021. Hopefully, we’ll be able to deliver longer term solutions when it comes to cutting healthcare costs across the board over the next few months.
Jan Dubauskas is a healthcare expert, enthusiastic insurance pro, attorney and mom serving as Vice President of healthinsurance.com.
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