Health Groups Convene Briefing on Medicare Out-of-Pocket Caps
On Tuesday, the MAPRx Coalition, which includes the National Council, hosted a Congressional staff briefing featuring a panel of advocates representing the AIDS Institute, the American Cancer Society, the National Council on Aging and Avalere Health. Speakers provided an overview of how Medicare Part D offers access to prescription drugs and the need for legislation that would place a cap on out-of-pocket costs for these medications. Currently, costs for medications that treat life-threatening illnesses such as cancer, HIV/AIDS, autoimmune diseases, which often co-occur with mental illness and substance use disorder, amount to tens of thousands of dollars per year per person. If Congress does not act, these expenses are set to increase in 2020, having a devastating impact for over 1 million Medicare enrollees.
RISING OUT-OF-POCKET COSTS FOR MEDICATIONS
Medicare Part D is the largest payer of prescription drugs in the U.S., and beneficiaries pay higher out-of-pocket costs than Medicaid and commercial beneficiaries combined. While there are programs such as the Low-Income Subsidy (LIS) to assist individuals with affording their medication, people who do not qualify for such assistance commonly meet the out-of-pocket threshold of $5,100, which moves them into the “catastrophic” phase of Part D coverage. This accounts for 1.1 million of the 44 million people on Medicare, who spent a total of $34 million on out-of-pocket costs in 2017.
For those who do not qualify for partial or fully subsidized benefits, Part D beneficiaries move through four phases during which there are different standards for the cost-sharing they are required to pay out of pocket. Once an individual has reached the catastrophic period after spending $5,100 out-of-pocket in one year, they are then responsible for 5% of the coinsurance for the remainder of the plan year. For individuals with high-cost medications, such as the one in four people with cancer that live with co-occurring depression, these costs can quickly multiply. Many expensive drugs, such as the 48 oncologic drugs that cost $10,000 or more per month, send individuals into the catastrophic period in the first few months of the year. At that point, 5% cost-sharing can be prohibitive to many Part D enrollees, causing them to elect to not fill their medically necessary prescriptions.
WHAT HAPPENS NEXT?
In 2020, the threshold for the catastrophic phase is estimated to increase from $5,100 to $6,350, which would further harm patients living with chronic conditions who rely on these medications, but struggle to afford them. The panelists at the briefing overviewed proposals to cap out-of-pocket costs at a yearly maximum for Medicare Part D beneficiaries. Such proposals are currently circulating in both the House and the Senate, with support from the White House. The National Council supports legislation that imposes a cap on out-of-pocket costs and ensures better affordability of medications covered under Medicare Part D.
The National Council thanks the MAPRx Coalition, the AIDS Institute, the American Cancer Society, the National Council on Aging and Avalere Health for adding their comments to the draft legislation. While the deadline for providing feedback has passed, the draft legislation and more information are available here.