The Build Back America Bill that has been on everyone's lips is now headed to the Senate where it still faces a battle for approval. But what is all the talk about? How, if approved, can it affect you? I will attempt to explain the possibilities as they currently stand. There are several parts of the bill I will not discuss as they are not directly tied to health care. Let's break this down based on how it looks now understanding there can and probably will be some changes made to the proposed bill prior to the Senate vote. So, who will most likely feel the changes the most and who will they help?
Medicare Prescription Drug Pricing Plan
One of the biggest sought-after fish is the drug reduction pricing plan, though it has been scaled down considerably since its introduction, its current form could still aid consumers. The demand for the reduction and control of drug prices has long been a rallying cry for consumers. For those who need expensive drugs like cancer patients, the cost burden has always been extremely high. Though consumers who retain private insurance have some protection, those who rely on Medicare often do not share those protections. Protections such as: max out of pocket may leave them in donut holes picking up a cost of treatment that may have no cost limit. Additionally, Medicare beneficiaries were often excluded from using drugmakers coupons or other financial assistance strategies.
What the current bill proposes:
It includes identifying 100 of the most expensive drugs and then targeting only 10 of them for negotiations to bring the cost down in 2025. It is also proposing placement of inflation caps on prescription drug prices for all insurance plans, restricting copays for insulin to no more than $35, for a 30-day supply and limiting Medicare beneficiaries’ annual out-of-pocket drug costs to $2,000.
Negotiating Drug Prices
The Department of Health and Human Services would be responsible for identifying the 100 highest-cost drugs and then choosing the 10 for price reductions. Again, that process will no start until 2023, with the costs reductions taking place in 2025. Another 10 drugs could be added to the list in 2028. Currently, no drugs have been identified
Here are the provisions and limitations to the drugs that will be selected:
Only drugs identified as one of a kind or the only drug available for a specified health problem would be included.
The selected drugs will also be limited to those that have been on the market beyond their period of exclusivity that the government grants them to be free from competition so that the manufacturer could recoup the cost of discovery and bringing the drug to market. Consequently, most of the newer drug still under patent (that generally cost much more) will be excluded from the list. This exclusivity period can last up to nine years. And for more complicated biologic drugs such as Ventetoclax, this exclusivity period can be 12 years.
This leaves the older drugs to be negotiated to lower levels to be chosen for the plan. Additionally, drugs from smaller companies with sales under $200 million are excluded from the selected list for fear the lowering of their drug prices could harm innovation.
This could help with Medicare, but if Medicare beneficiaries' copayments are capped at the $2000.00 it doesn’t make much of a difference. Especially when you consider the cost of cancer drugs. The cost of drugs will be linked to inflation with rebates paid by the manufacturer to the government if the cost increases exceed inflation. The goal is to slow the overall inflation of drugs prices which has exceeded general inflation for decades.
Savings are expected to be seen over the long haul for the government which pays for the Medicare program and for consumers who don’t qualify for other programs to help pay for the drug costs for the needed high-cost medications.
Controlling Insulin Costs
One of the most needed benefits will go to those patients needing insulin for Type 1 diabetes and some with Type 2 diabetes. This drug has been around for decades yet the price has risen quite rapidly in recent years. In fact, the cost of insulin tripled from 2009- 2019. For cancer patients that have become insulin-dependent as a result of medications, this is a very costly addition to their care. The proposed bill will limit the cost of insulin to $35.00 for a month supply. It’s estimated that patients will save about $466 per year for Medicare beneficiaries. Unfortunately, there doesn't seem to be any additional costs savings for the additional supplies needed for diabetes care.
Limiting Out-of-Pocket Spending
The bill proposes a limit of $2000.00 for Medicare beneficiaries for out-of-pocket costs for prescription drugs. The current Medicare Part D prescription drug plan, in their calculation, features the donut hole that many falsely believe has gone away, but which has not. The donut hold still exists but has been reduced a bit. Medicare beneficiaries who are dependent on expensive drugs will testify to the 25% patient responsibility in the coverage gap after spending $4,130, to a 5% patient responsibility after spending $6,500 on prescription drugs. With some cancer drugs costing in excess of $28,000/month, even with Medicare, that donut hole can be daunting and wreak havoc on personal finances. Particularly if a patient requires more than one high-cost drug in their treatment plan. Many people are meeting their deductible for the first part of the donut hole in the first few months of the year leaving them with a 5% cost-sharing for the still high-cost prescriptions for the remainder of the year.
Limiting the prescription out-of-pocket expenses is especially beneficial to people who get little income assistance and have expensive illnesses. Hence the $2000.00 cap will reduce very expensive myeloma prescription treatments. A definite win for patients.
Again, the Senate is now grappling with the bill. So, don’t expect things to remain as they currently are. If changes are made, they can be a start in the right direction and can open the door to other cost reductions in the future.
This bill emphasizes the need for all Medicare beneficiaries to carefully review their Medicare Advantage, Supplemental/Medigap, and Part D Plans, as well as the privately insured.
Understanding and making the necessary changes to your plan in a timely manner can help you control your costs as best as possible.
Diahanna is the lead Financial Coach with the Myeloma Coach program. She and her team of Financial Coaches on the Myeloma Coach team help individuals navigate the financial impact and burden of myeloma. Myeloma Coaches have experience with insurance issues, Medicaid, Medicare, short/long term disability, or financial assistance. All Myeloma Coaches are myeloma patients or caregivers who have personal experience living with myeloma. They can share their personal experience as well as resources that have helped them.
about the author
Diahanna is the Financial Program Manager for the HealthTree Foundation. She specializes in providing financial help, resources and education for multiple myeloma patients. As a professional financial consultant and former caregiver of her husband who was diagnosed with multiple myeloma, Diahanna perfectly understands the financial issues facing myeloma patients.