Trump aims to reduce drug costs under Medicare
President Donald Trump will propose lowering prescription drug costs for Medicare beneficiaries by allowing them to share in rebates that drug companies pay to insurers and middlemen, an administration official said Thursday.
A senior administration official outlined the plan on condition of anonymity ahead of the release of Trump’s 2019 budget plan next week.
Pharmaceutical companies now pay rebates to insurers and pharmacy benefit managers to help their medications gain a bigger slice of the market.
Insurers apply savings from rebates to keep premiums more manageable.
Under Trump’s proposal, seniors covered by Medicare’s popular “Part D” prescription benefit would be able to share in the rebates for individual drugs that they purchase at the pharmacy.
Trump’s budget would also expand Medicare’s “catastrophic” drug benefit so that many seniors with very high costs would not face copayments. Seniors with high drug bills are currently still responsible for 5 percent of the cost of their medications. With some new drugs costing $100,000 a year or more, patient costs add up quickly.