Congressman Doyle Calls for Lower Medicare Prescription Drug Prices
Pittsburgh, PA – October 26, 2006 – U.S. Representative Mike Doyle (PA-14) today called for the U.S. Congress to immediately allow the Medicare program to negotiate with drug manufacturers for lower-priced medicine for senior citizens, along with other reforms in the Medicare Part D prescription drug benefit program.
“Thousands of senior citizens in Allegheny County are paying more for prescription drugs than they can afford to, despite the modest assistance provided by the new Medicare prescription drug plan,” Congressman Doyle said today. “If Congress would just let Medicare negotiate with the drug companies for lower prices, it could save local seniors hundreds of dollars a year.”
Congressman Doyle made this statement following the release of a report by the House Government Reform Committee that indicated that such a change could save local seniors who participate in the Medicare prescription drug program between $579 and $3,560 a year on average over the next ten years. The Report concluded that:
- Almost 14 million Medicare beneficiaries could save over $60 billion in premiums, co-pays, and other out-of-pocket drug costs. Democrats have proposed allowing the Medicare program to negotiate for lower drug prices, which could reduce prices by 25% or more. There are 8.7 million Medicare beneficiaries nationwide enrolled in Medicare drug plans who pay their own premiums and co-pays, and they could expect average savings of almost $500 annually if Medicare negotiated for 25% lower drug prices. The total savings over the next decade for these beneficiaries would be $61 billion. If beneficiaries enrolled in Medicare HMOs received similar discounts, the total savings over the next decade would be $96 billion.
- Over six million Medicare beneficiaries could avoid the “donut hole.” Drug benefits under standard Medicare drug plans end once beneficiaries have used $2,250 worth of drugs and do not begin again until they have used over $5,100 worth of drugs. The latest estimates indicate that 6.2 million beneficiaries nationwide will hit the donut hole this year, resulting in average out-of-pocket costs of $1,700 per beneficiary. Democratic reform proposals in Congress would provide enough savings to eliminate or significantly reduce the size of the donut hole.
- Over 1 million Medicare beneficiaries could avoid hundreds of dollars in penalties. Enrollment in the Medicare drug program has been well below expectations, with over four million Medicare beneficiaries failing to sign up with a Medicare drug plan prior to the May 15, 2006, deadline. An estimated 1.1 million of these beneficiaries are now subject to lifetime penalties that could cost each individual almost $500 to over $1,000 over the next decade. Democratic reform proposals would give these beneficiaries an opportunity to participate in a Medicare drug plan without these unnecessary penalties.
“Ever since Congress passed the flawed Medicare prescription drug bill in 2003, I’ve been calling for reforming it so that it provided more benefits for seniors and fewer windfalls for drug manufacturers,” Congressman Doyle observed. “This report confirms what I’ve been saying about the Medicare prescription drug bill all along – it shortchanges seniors and taxpayers and ought to be fixed right away.”
The full report can be accessed on-line at:
http://www.democrats.reform.house.gov/Documents/20061026134104-47719.pdf
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