The Government Accountability Office, the non-partisan watchdog arm of Congress, found that prices for brand-name drugs used by Medicare beneficiaries increased at a similar rate before and after the government required discounts in January 2011.(Photo: Paul J. Richards, AFP/Getty Images)
WASHINGTON -- Prescription drug prices did not increase for other
Medicare consumers after pharmaceutical companies gave the government
discounts to help seniors deal with a gap in benefits known as the
"doughnut hole," a new report shows.
Accountability Office, the non-partisan watchdog arm of Congress, found
that prices for brand-name drugs used by Medicare beneficiaries
increased at a similar rate before and after the government required
discounts in January 2011.
"This report shows how health reform is
working to save seniors $4.8 billion and helping them afford their
prescription drugs, closing the donut hole," Senate Finance Committee
Chairman Max Baucus said in a press statement. "We need to help seniors
save every dollar they can and that's exactly what the Affordable Care
Act does - reducing seniors' out-of-pocket costs while providing more
Republican presidential nominee Mitt Romney has vowed to overturn the law if elected.
2010 health care law required a 50% discount on prescription drugs in
the gap between traditional and catastrophic coverage in the Medicare
drug benefit, or Part D. In 2011, seniors saved about $2.16 billion
through the program, Department of Health and Human Services records
Critics of the law, such as the health insurance industry,
worried that the discounts would push prescription costs up for those
not within the gap to offset the manufacturer discounts. Several members
of Congress, including Baucus, asked GAO to investigate.
found that 77 brand-name drugs increased 36% for those within the
coverage gap from January 2007 to December 2010 - or before the discount
program began - and 35% for those not within the gap. From December
2010 to December 2011, after the program was in place, they increased
13% in both categories. HHS said GAO's findings mirrored its own, though
each agency used different reporting methods.
continue to manage this program aggressively to ensure that brand-name
discounts are applied accurately and timely," wrote Jim Esquea,
assistant secretary for legislation at HHS.
Robert Zirkelbach, spokesman for America's Health Insurance Plans, expressed concern about the 13% overall increases.
order to make health care coverage more affordable, there needs to be a
much greater focus on the prices that are being charged for
prescription drugs and other medical services, which continue to
increase at unsustainable rates," he said.
AHIP launched a new
iPad app today, U.S. Health Care Spending 101, designed to help people
better understand those rising costs, Zirkelbach said.
75% of Part D Medicare drugs were generic, according to the Center for
Medicare Services. In 2012, the coverage gap is $2,930, and the health
care law will eliminate the doughnut hole by 2020.