As Republican former U.S. President Donald Trump threatens to "terminate" a 2022 law that cut prescription costs for seniors, his Democratic opponent in next week's election, Vice President Kamala Harris, is pushing for an expansion of the policy that could save Americans billions of dollars, according to research released Friday.
Two years ago, President Joe Biden signed the Inflation Reduction Act (IRA), capping annual out-of-pocket costs for patients with Medicare Part D; it's currently around $3,500 but set to drop to $2,000 next year. The Biden White House's budget for fiscal year 2025 and the Harris campaign have both advocated for extending that cap to people with private health insurance.
The government watchdog group Public Citizen found that if implemented in 2022, "a $2,000 annual cap would have reached more than 900,000 patients with private insurance, saving them a total of $2.78 billion, equating to over $3,000 in savings per patient."
Public Citizen co-president Robert Weissman said in a statement Friday that "no one should ever have to choose between taking their medicine and putting food on the table."
"Vice President Harris is working to bring relief to patients who are struggling to afford to care for themselves as part of her bigger plan to lower drug costs," he continued. "This proposed cap must work in tandem with a bigger, bolder congressional effort to stop pharmaceutical companies from price gouging treatments. We cannot let Big Pharma continue to take advantage of American patients and put more strain on our healthcare system."
"We cannot let Big Pharma continue to take advantage of American patients and put more strain on our healthcare system."
Based on Public Citizen's analysis of data from the Medical Expenditure Panel Survey for 2022, if the IRA had featured a $1,000 annual cap, 4.1 million Medicare enrollees would have collectively saved $4.53 billion, or an average of almost $1,100, while nearly 2.7 million patients with private insurance would have saved $4.38 billion, or over $1,600 each.
If the IRA had gone even further with a $200 annual cap, the group found, more than 18 million Medicare enrollees would have saved a total of $11.42 billion, or over $600 each, while nearly 21 million of those with private insurance would have saved $10.55 billion, or more than $500 per patient.
Such savings could significantly improve patients' lives, Public Citizen argued, pointing out that "due to the high costs of prescription drugs, nearly a third of Americans do not take medications as prescribed. This includes cutting pills in half, skipping doses, not filling a prescription, or taking over-the-counter drugs instead of filling a prescription due to cost barriers."
"The imperative of lowering costs for patients to improve adherence and relieve financial stress is clear, but unless OOP cost caps are passed alongside policies to lower the prices drug corporations charge for medicines, they risk shifting costs onto other patients through higher premiums as well as other healthcare payers," the report warns. "The federal government could provide relief, but without reducing prices, taxpayers would be left on the hook."
As an example of a bill that Harris and Democrats could pursue if they win the White House and Congress next week, Public Citizen highlighted a Congressional Budget Office estimate that "the Elijah E. Cummings Lower Drug Costs Now Act would lower spending by more than $450 billion over 10 years, compared to the $101 billion in savings it projected for drug price reforms passed through the Inflation Reduction Act."
"That legislation, which was passed unanimously by House Democrats, went further than reforms included in the Inflation Reduction Act by using international reference pricing, increasing the number of drugs negotiated each year, expanding negotiation eligibility (including by allowing negotiations for expensive medicines without delay periods), and providing access to negotiated prices in private insurance," the group noted.
As Common Dreamsreported earlier this week, drug companies are already battling the IRA's drug cost policies—including allowing Medicare to negotiate the price of some commonly used medications—in court while raking in massive profits.