Bush Offers Revised Medicare Rx Drug Discount Card Plan
The Bush administration unveiled yesterday a revised version of its prescription drug discount card plan for Medicare beneficiaries, hoping to overcome the obstacles that prevented implementation of the original proposal last year, the Washington Post reports (Goldstein, Washington Post, 3/1). Unlike the original plan, which called for discounts to be extracted solely from pharmacies, the new version calls for both drugstores and drug makers to offer discounts if they choose to participate in the program (Pear, New York Times, 3/1). The new, "far more detailed" plan calls for CMS to grant a "seal of approval" to "companies and other organizations that prove they can secure lower prices for large numbers of patients." The sponsors would negotiate discounts with pharmacies and drug makers and then pass the savings on to Medicare beneficiaries who purchase a discount card. The proposal also would require sponsors to offer a discount on "at least one drug in every major category of medicine." The size of the discount is not specified in the proposal, although administration officials said that savings could average 15% (Washington Post, 3/1). Beneficiaries would pay a maximum enrollment fee of $25 to obtain a discount card, which they would present to their pharmacy (Kemper, Los Angeles Times, 3/1). Administration officials said that the 10.8 million Medicare beneficiaries without prescription drug coverage through supplemental insurance policies or Medicare+Choice plans would be most likely to use the discount card (New York Times, 3/1). HHS Secretary Tommy Thompson said he was "optimistic" that the plan would be implemented within a year (Lueck, Wall Street Journal, 3/1).
The revised proposal comes after U.S. District Court Judge Paul Friedman, acting on a lawsuit filed by pharmacy groups, issued an injunction last September blocking HHS from implementing the discount plan after finding that the administration "lacked the authority to create such a program unless it either obtained congressional approval or wrote a regulation" (Washington Post, 3/1). The administration has taken the latter path; a proposed regulation is set to be published in the Federal Register today, and CMS will accept public comment for 60 days (Wall Street Journal, 3/1). The administration has also attempted to address the issue of whether it has the legal authority to implement such a program, citing "several statutes, including one that allows Medicare to educate beneficiaries" (AP/Houston Chronicle, 2/28). The new proposal specifies that CMS "must ensure" that beneficiaries have "easy access to enough information to help them choose which card would save them the most money on the specific medicines they take." The proposal also would attempt to coordinate a federal discount card with the similar programs being offered by many states (Washington Post, 3/1).
The revised proposal comes after U.S. District Court Judge Paul Friedman, acting on a lawsuit filed by pharmacy groups, issued an injunction last September blocking HHS from implementing the discount plan after finding that the administration "lacked the authority to create such a program unless it either obtained congressional approval or wrote a regulation" (Washington Post, 3/1). The administration has taken the latter path; a proposed regulation is set to be published in the Federal Register today, and CMS will accept public comment for 60 days (Wall Street Journal, 3/1). The administration has also attempted to address the issue of whether it has the legal authority to implement such a program, citing "several statutes, including one that allows Medicare to educate beneficiaries" (AP/Houston Chronicle, 2/28). The new proposal specifies that CMS "must ensure" that beneficiaries have "easy access to enough information to help them choose which card would save them the most money on the specific medicines they take." The proposal also would attempt to coordinate a federal discount card with the similar programs being offered by many states (Washington Post, 3/1).
Despite the revisions to the plan, pharmacy groups said that the new proposal is "still illegal" and would still cut into their profits. "It's like old, recalled bad medicine in a new container," John Rector, general counsel for the National Community Pharmacists' Association (which along with the National Association of Chain Drug Stores sued the administration last year) said. "If they don't have the authority, they can't perfect the proposal by changing it or adding things to it," he added (Fulton/Rovner, CongressDaily/AM, 3/1). Both groups said that they might return to court to attempt to block the new proposal. "The threshold question is, is this substantially different from the previous rule? We don't think that it is," NACDS' general counsel Larry Kocot said (Wall Street Journal, 3/1). Meanwhile, Families USA Executive Director Ron Pollack said the administration's proposal "will provide precious little relief" to seniors. He said that the plan does not guarantee a specific level of discount, does not promote the use of cheaper generic drugs and relies on the "good will" of drug makers to offer discounts (Washington Post, 3/1).
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