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Savings Increasing in Medicare Drug Program, Says
Administrator
Sept. 24, 2004 Maybe its the free market at
work? The prices on prescription drugs in the Medicare-approved drug
card program are dropping. Medicare announced yesterday that savings for
senior citizens with cards have increased from an average of 11 to 18
percent, to 12 to 21 percent.
Medicare Administrator Mark McClellan made the
announcement at a forum sponsored by the U.S. Senate Special Committee
on Aging yesgterday.
McClellan also said the program is growing, I am
happy to report that the discount drug cards have successfully reduced
the cost of prescription drugs for over 4.4 million Medicare
beneficiaries and that number is growing by about 10,000 new enrollees a
day.
Companies sponsoring cards in the Medicare program
are free to change their prices. It appears for now they are heading
down, perhaps spurred by the slow response by seniors participation.
McClellan also spoke yesterday at the Access to
Benefits Coalition for the kick-off of their new efforts to help
low-income seniors better understand the drug card program and get
enrolled.
It's no secret there's been some skeptical chatter
about this program but the facts, I am pleased to say, speak louder
than words, said Chairman Larry Craig (R-Idaho). The new drug cards,
while not a magic bullet, are already showing real and substantial
downward pressure on prices. Today's drug card program is just a
beginning a stepping stone, if you will toward implementation of the
full prescription drug benefit.
For low-income seniors,
who qualify for an additional $600 in assistance from the federal
government, Medicare reported that seniors can save between 44 and 92
percent over average retail pharmacy prices.
By any measure thats a terrific deal, Craig
said.
For 10 commonly used drugs researchers examined,
the best Medicare-approved drug discount card offered prices at least 5
to 33 percent lower compared to Drugstore.com and 11 to 34 percent lower
compared to Costco.com. The research also found that the
Medicare-approved cards with the best retail prices even beat Internet
mail order prices most of the time.
It's exciting to note that all of the research
has consistently shown great savings for beneficiaries, Dr. McClellan
said. No matter which methodology or mix of drugs is used - brand
versus generic, baskets versus individual drugs, weighted by volume
sales or not - all methodologies yield very similar findings. These
price reductions are on the drugs that beneficiaries use commonly,
including many drugs not included in the formularies of government-run
drug plans.
The new Medicare analysis confirms recent research
by the non-partisan Kaiser Family Foundation, the Lewin Group, the
American Enterprise Institute, the Healthcare Leadership Council, and
Health Policy Alternatives, whose research was also discussed at the
forum.
The new government study found that seniors with
the Medicare discount cards who currently buy generic drugs can obtain
savings between 45 to 75 percent below typical prices paid by others who
purchase generic medications. Beneficiaries currently using brand name
drugs who are able to switch to generics can save even more.
Link to Forum Details U.S. Senate Special Committee on Aging
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