President Obama announced on Saturday that pharmaceutical and biotechnology companies have agreed to discount the cost of prescription drugs to Medicare beneficiaries who incur large out-of-pocket expenses when they fall in the “doughnut hole” coverage gap in Medicare Part D plans. The agreement, which Obama said will be included in the healthcare reform legislation he expects to sign in October, is part “of the landmark pledge many health industry leaders made to me last month when they offered to do their part to reduce health spending $2 trillion over the next decade,” he said in a statement.
Pharmaceutical companies said they will provide a 50-percent discount to most beneficiaries on brand-name medicines covered by a patient’s Part D plan when purchased in the coverage gap, and the negotiated price will be applied toward beneficiaries’ out-of-pocket costs. “Importantly, the proposal would not require any additional paperwork on the part of the beneficiary nor would an asset test be used for eligibility,” said a statement from the Pharmaceutical Research and Manufacturers of America. The drug discount will cost drug makers $80 billion in revenues over 10 years, reports the Wall Street Journal/Associated Press.
