Healthcare law has saved seniors $460M on drugs, HHS says

Seniors have saved more than $460 million on prescription drugs because of healthcare reform, the Health and Human Services Department said Thursday.

As part of the reform law, the pharmaceutical industry agreed to offer a 50 percent discount for brand-name prescription drugs in the Medicare “doughnut hole” — the coverage gap in which seniors pay for their drugs out of pocket.

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Nearly 900,000 seniors have received that discount, at a total savings of $461 million, according to HHS. 

The department also said premiums for prescription drug coverage will decrease slightly next year. The average premium will fall roughly $1, holding steady at around $30, according to an HHS release.

The insurance industry touted the success of Medicare’s prescription drug program — which many conservative policy experts see as a good model for other parts of the healthcare system. 


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“Medicare beneficiaries will have more affordable prescription drug coverage next year as a result of vigorous competition in the Part D program and Medicare drug plans’ efforts to encourage seniors to choose the most affordable medicines,” America’s Health Insurance Plans said in a statement.

Seniors can chose from a variety of Part D plans, and Medicare chief Don Berwick said competition “clearly helps” keep premiums from rising. But he warned against overextending the lessons of Part D.

Rep. Paul RyanPaul RyanClinton targets Trump on race Clinton to receive first classified briefing Saturday Clinton enjoying edge over Trump in Silicon Valley MORE (R-Wis.) has made comparisons to the drug program in his push to transform Medicare into a sort of voucher system. His plan would phase out the existing program and move seniors to private insurance plans, similar to the range of Part D policies from which seniors can choose.

Berwick, however, said Thursday’s figures show that the existing structure is working.

“Remember that the Ryan plan is very draconian,” he said on a conference call with reporters.

Separately, HHS said 17 million seniors have received at least one preventive healthcare service without a co-pay. The healthcare law eliminated co-pays for many preventive services under Medicare and will ultimately do the same for private insurance.