Ahead Of President Trump's Announcement On Drug Pricing, A Look At The Trump Administration Strides Towards Lowering Drug Prices
- Today President Trump will announce his plan to lower the cost of prescription drugs, a commitment and campaign pledge this administration has already begun to undertake.
- In 1998, U.S. spending on prescription drugs was $91 billion; by 2015, this number had soared to a cost of $457 billion-approximately 40 percent of which is borne by the taxpayer.
- Under the guidance of the Trump Administration, the Food and Drug Administration and the Centers for Medicare and Medicaid have taken dramatic steps towards lowering the cost of prescription drugs for Americans.
- In 2017, the FDA approved a record-setting number of generic prescription drugs for sale in the marketplace in an effort to lower costs and bring more competition to market; the number of generic approvals by the FDA has increased from 492 in 2015 to 1,027 in 2017.
- The Centers for Medicare and Medicaid Services has taken action to lower the cost of Medicare drugs for almost 44 million Medicare prescription drug participants by lowering the amount they pay for prescription drugs.
- It is estimated the Trump Administration's improvements to the Medicare system have saved beneficiaries $320 million in out-of-pocket payments on these drugs.
THE TRUMP ADMINISTRATION HAS WORKED TO ADDRESS THE RISING COST OF PRESCRIPTION DRUGS
Today, President Trump Announced His Plan To Lower The Cost Of Prescription Drugs
Today, President Trump Will Address The Nation On Lowering Prescription Drug Prices. "U.S. President Donald Trump on Friday will deliver a speech about lowering prescription drug prices, a White House spokesman said on Tuesday." ("Trump To Deliver Speech On Drug Prices On Friday: White House," Reuters , 5/8/18)
Today's Actions Are An Extension Of Candidate And President Trump's Commitment To Combating Rising Drug Prices Which Have Become A Burden For Many Americans
During His Campaign, Donald Trump Claimed That A Way To Combat High Prices In Prescription Drugs Would Be To Get Congress To "Remove Barriers To Entry Into Free Markets For Drug Providers That Offer Safe, Reliable And Cheaper Products." "Remove barriers to entry into free markets for drug providers that offer safe, reliable and cheaper products." ("Healthcare Reform To Make America Great Again," Donald J Trump For President , Accessed 5/10/18)
In 1998, U.S. Spending For Prescription Drugs Was $91 Billion, "More Than Doubling Since 1990." "U.S. spending for prescription drugs was $91 billion in 1998, more than doubling since 1990." ("Prescription Drug Trends," Kasier Family Foundation , Accessed 5/10/18)
In 2015, According To A U.S. Department Of Health And Human Services Report, Prescription Drug Spending In The United States Reached $457 Billion. "ASPE estimates that prescription drug spending in the United States was about $457 billion in 2015, or 16.7 percent of overall personal health care services." ("Observations On Trends In Prescription Drug Spending," The U.S. Department Of Health And Human Services , 3/8/16)
Because The U.S. Government Pays More Than 40 Percent Of The Retail Prescription Drug Tab, Rising Spending On Drugs Is "Putting Pressure On The Federal Budget." "Because the U.S. government pays more than 40% of the retail prescription drug tab, rising spending on drugs is putting pressure on the federal budget. It also contributes to rising health insurance premiums." (Peter Olson and Louise Sheiner, "The Hutchins Center Explains: Prescription Drug Spending," The Brookings Institution , 4/26/17)
- Medicare Part D Prescription Drug Spending Has Increased 97 Percent Since 2007, Amounting to A Total Of $94 Billion. "Medicare Part D prescription drug spending is projected to total $94 billion in 2017, an increase of 97 percent since 2007." ("2019 Major Savings And Reforms," White House , Accessed 5/10/18, p. 149 )
Expenditures On Prescription Drugs Have Risen Faster Than Overall Health Spending. "Expenditures on prescription drugs are rising and are projected to continue to rise faster than overall health spending thereby increasing this sector's share of health care spending." ("Observations On Trends In Prescription Drug Spending," The U.S. Department Of Health And Human Services , 3/8/16)
- Expenditures On Specialty Drugs Have Risen Even "More Rapidly" Than Expenditures On Other Drugs. "Expenditures on specialty drugs generally appear to be rising more rapidly than expenditures on other drugs, though estimates of specialty drug expenditures are highly sensitive to which drugs are considered 'specialty' products." ("Observations On Trends In Prescription Drug Spending," The U.S. Department Of Health And Human Services , 3/8/16)
Prescription Drug Costs Take "10 Cents Out Of Every Dollar Spent On U.S. Health Care" While The U.S. Accounts For 33 Percent Of World Spending On Prescription Drugs. "Prescription drug costs take 10 cents out of every dollar spent on U.S. health care, and the United States accounts for 33 percent of world spending on prescription drugs despite accounting for only 4 percent of the world's population." (Press Release, "Regulation, Competition Needed To Lower Drug Prices, Says Panel," American Academy Of Family Physicians , 8/2/17)
According To A Kaiser Family Foundation Analysis, It Is Estimated That For The Foreseeable Future, Prescription Drugs Will Continue To Represent The "Larger Portion Of Overall Health Spending." (Cynthia Cox and Rabah Kamal, "What Are The Recent And Forecasted Trends In Prescription Drug Spending?" Peterson-Kaiser Health System Tracker , 12/20/17)
The Centers For Medicare And Medicaid Services Has Projected That Among The Major Sectors Of Healthcare, Spending Growth For Prescription Drugs Will Average 6.3 Percent From 2017 - 2026. "Among the major sectors of healthcare, spending growth is projected to be fastest for prescription drugs, averaging 6.3 percent for 2017-2026." (Press Release, "CMS Office Of The Actuary Releases 2017-2026 Projections Of National Health Expenditures," Centers For Medicare And Medicaid Services , 2/14/18)
In March 2016, Then-Candidate Trump Said "We Don't Bid Out" The Drug Industry Which Is Why They "Pay Almost As Much As If You Walk Into A Drug Store." TRUMP: "Well, I don't know if he's saying that. Look, I'm just saying very simply we have a country that I've never seen anything like it. I've been going over budgets and looking at budgets. We don't bid things out. We don't bid out, as an example, the drug industry, pharmaceutical industry. They don't go out to bid. They just pay almost as if you walk into a drug store. That's what they're paying." (Donald Trump, Remarks At CNN Republican Presidential Debate , Miami, FL, 3/15/16)
In January 2017, President-Elect Donald Trump Stated That Pharmaceutical Companies Were "Getting Away With Murder" With The Prices They Charge The Government For Prescription Drugs. "U.S. President-elect Donald Trump on Wednesday said pharmaceutical companies are 'getting away with murder' in what they charge the government for medicines, and promised that would change, sending drugs stocks sharply lower." (Rodrigo Campos and Caroline Humer, "Trump Says Pharma 'Getting Away With Murder,' Stocks Slide," Reuters , 1/11/17)
In An Effort To Increase Competition And Lower Prices, The Trump Administration Has Increased The Number Of Generic Drugs Approved For Sale In The Marketplace
According To A 2017 Commonwealth Fund Report, Currently There Are 182 Drugs That Do Not Have Patent Protection Or Any Associated Generics. "Because of manufacturers' actions, as well as market forces, there are currently 182 drugs that no longer have patent protection or any associated generics." (Henry Waxman et all, "Getting To The Root Of High Prescription Drug Prices," Commonwealth Fund , 7/10/17, p. 20)
"There Are More Than 500 Patented Drugs With Only One Marked Generic." Furthermore, there are more than 500 patented drugs with only one marketed generic." (Henry Waxman et all, "Getting To The Root Of High Prescription Drug Prices," Commonwealth Fund , 7/10/17, p. 20)
Investing In Generic Drugs Would Make It "Easier For Companies To Develop Generic Drugs" And Put "Generics Into Markets With No Existing Competition." "But when he was confirmed back in May, Gottlieb identified generics as the space where the agency could potentially have the most impact in the quickest way - both by making it easier for companies to develop generic drugs and nudging generics into markets with no existing competition." (Paige Winfield Cunningham, "The Health 202: Generic Drugs Had A Great 2017," The Washington Post , 1/2/18)
The Food And Drug Administration (FDA) Has "Sped Up Approval Of Generic Drugs, Injecting More Competition In The Market." "The Food and Drug Administration has sped up approval of generic drugs, injecting more competition in the market." (John Fritze, "Trump To Deliver Major Address On Drug Prices, But Advocates Predict Small Steps," USA Today , 5/4/18)
In 2017, The FDA Approved 1,027 Generic Drugs For Sale, A "A Record-Setting Number." "In 2017, the FDA approved a record-setting number of generic prescription drugs for sale in the marketplace in an effort to lower costs and bring more competition to market; the number of generic approvals by the FDA has increased from 492 in 2015 to 1,027 in 2017." ("2017: A Year of Accomplishment," U.S. Department Of Health And Human Services , 1/26/18, p. 15)
FDA Commissioner Gottlieb Called The Numbers A "Milestone" And A "Victory For Consumers." (Scott Gottlieb, Twitter Feed , 10/17/17)
The Centers For Medicare And Medicaid Services Has Promulgated New Regulations Which Aim To Lower The Cost Of Prescription Drugs For Millions Of Medicare Recipients
In November 2017, The Centers For Medicare And Medicaid Took An "Important Step" And Released A Memo Regarding A Revision In The Physician Fee Schedule That Would "Modernize The Medicare Payment System." "As part of the President's priority to reduce drug costs for Americans, CMS is taking an important step in the Physician Fee Schedule to modernize the Medicare payment system through innovation in the biopharmaceutical market." (Press Release, "CMS Finalizes Policies That Reduce Provider Burden, Lower Drug Prices," Centers For Medicare And Medicaid Services , 11/2/17)
The Notice Announced That In 2018, CMS Would Begin Updating Payments For "Biologicals," Which Are Lower-Cost Alternatives To Certain Prescription Drugs Which Would Promote Competition And Make Sure That Patients "Have Access To Lower Cost Therapies." "Beginning in 2018, CMS will update payment for biosimilars, which are lower-cost alternatives to certain types of drugs known as 'biologicals.' This change promotes competition to ensure millions of patients will have access to new lower cost therapies." (Press Release, "CMS Finalizes Policies That Reduce Provider Burden, Lower Drug Prices," Centers For Medicare And Medicaid Services , 11/2/17)
In April 2018, CMS Released Final Policies That Would Reduce The "Maximum Amount" That A Low-Income Beneficiary Would Pay For Certain Prescription Biosimilars. "The final policies announced today further the Trump Administration's commitment to lowering drug prices. CMS is finalizing a reduction in the maximum amount that low-income beneficiaries pay for certain innovative medicines known as 'biosimilars.'" (Press Release, "CMS Lowers The Cost Of Prescription Drugs For Medicare Beneficiaries," Centers For Medicare And Medicaid Services , 4/2/18)
Beneficiaries Will Now Save On Coinsurance On Medicare Part B Drugs Administered At 340B Program Hospitals. "In Medicare, a rule implemented for 2018 will help beneficiaries save on coinsurance on Part B drugs administered at hospitals that participate in the 340B program by reducing the amount Medicare pays for those drugs." (Press Release, "CMS Lowers The Cost Of Prescription Drugs For Medicare Beneficiaries," Centers For Medicare And Medicaid Services , 4/2/18)
- Coinsurance Is An Amount That A Recipient Would Pay As A Percentage Of The Drug Cost. "With coinsurance, you pay a percentage of the cost (like, 25%) of the drug." ("Copayment/Coinsurance In Drug Plans," Medicare.gov , Accessed 5/10/18)
- The 340B Program Has Allowed Hospitals To Buy Drugs At A "Lower Cost" And Now Medicare Beneficiaries Will Benefit From Those Discounts. "The 340B program allows hospitals to buy drugs at a lower cost. Due to CMS's policy change last year, Medicare beneficiaries are currently benefiting from the discounts that 340B hospitals receive." (Press Release, "CMS Lowers The Cost Of Prescription Drugs For Medicare Beneficiaries," Centers For Medicare And Medicaid Services , 4/2/18)
By April 2018, It Was Estimated That Beneficiaries Had Saved $320 Million On Out-Of-Pocket Payments On These Drugs. "Due to CMS's policy change last year, Medicare beneficiaries are currently benefiting from the discounts that 340B hospitals receive. Beneficiaries are saving an estimated $320 million on out-of-pocket payments for these drugs in 2018 alone." (Press Release, "CMS Lowers The Cost Of Prescription Drugs For Medicare Beneficiaries," Centers For Medicare And Medicaid Services , 4/2/18)
- Out-Of-Pocket Costs Are Expenses For Medical Care That "Aren't Reimbursed By Insurance," And Include Deductibles, Coinsurance, And Copayments. "Your expenses for medical care that aren't reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services plus all costs for services that aren't covered." ("Out-Of-Pocket-Costs," Healthcare.gov , Accessed 5/10/18)
- In 2015, Nearly A Quarter Of Insurance Enrollees Have Spent $1,000 Or More On Out-Of-Pocket Expenses. "While the majority - over 60% - of insurance enrollees had less than $500 in out-of-pocket expenses in 2015, nearly a quarter spent $1,000 or more on health care services and more than 1 in 10 workers spent over $2,000." (Gary Claxton, Cynthia Cox And Bradley Sawyer, "An Analysis Of Who Is Most At Risk For High Out-Of-Pocket Health Spending," Peterson-Kaiser Health System Tracker , 10/4/17)
- This Trend Has Represented A "Growing Fraction Of Patients Over the Last Decade" Facing Higher Out-Of-Pocket Costs. "This represents a growing fraction of patients over the last decade, with the share spending $1,000 or more rising from 17% to 24%."(Gary Claxton, Cynthia Cox And Bradley Sawyer, "An Analysis Of Who Is Most At Risk For High Out-Of-Pocket Health Spending," Peterson-Kaiser Health System Tracker , 10/4/17)
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