WASHINGTON, D.C. (November 20, 2020) The Partnership to Fight Chronic Disease has issued the following statement in response to the Trump Administration’s Final Rule to extend benefits of drug rebates to Medicare beneficiaries:
“Rebates lower drug costs for insurers, but patients taking the medicines often do not benefit from rebates or other discounts. In 2019, rebates and other discounts on prescription drugs reduced drug spending by $175 billion, but drug costs for Medicare beneficiaries continues to rise.
“Under the Trump Administration’s Executive Order, Medicare beneficiaries will finally see their drug spending go down at the pharmacy counter as savings from rebates and other discounts on medicines have to be shared with beneficiaries.
“Currently, many patients pay list prices for their prescription medicines, even though their insurance company has negotiated much lower prices and pays less. This rule changes that to the benefit of people with drug coverage under Medicare.
“Most Medicare beneficiaries live with one or more chronic condition and rely on medications to manage their health. Lowering their out-of-pocket costs at the pharmacy counter will provide welcome relief for these seniors.
“This change will also increase competition and lower costs overall. Lowering out-of-pocket costs improves medication adherence, which in turn lowers total healthcare spending and reduce the burden of illness. Further, rebates can incentivize favoring drugs with higher rebates compared to less expensive drugs with lower rebates on formularies driving costs higher for Medicare overall.
“HHS Secretary Alex Azar has called the rebate scheme "a hidden system of kickbacks to middlemen." The change the Administration announced today marks a positive step towards transparency and to the benefit of Medicare and the nearly 60 million people Medicare serves.”
The Partnership to Fight Chronic Disease (PFCD) is an international coalition of patient, provider, community, business and labor groups, and health policy experts, committed to raising awareness of the number one cause of death, disability and rising health care costs: chronic disease.