Finally: Lower Medicare Drug Prices

By Catherine Taylor
AARP Rhode Island State Director

This is the story of an historic win for Rhode Islanders.

The names of the first 10 Medicare drugs whose prices the federal government will negotiate directly with manufacturers were announced August 29^th. This marks the first time in history that the price of life-sustaining medications that millions of older Americans in the nation’s largest health program rely upon to prevent strokes and blood clots and to treat diabetes and cancer will be subject to direct negotiation.

Access to affordable prescription drugs empowers you to stay healthy as you choose the way you age. At live events, on social media and via email, we heard the stories of older Rhode Islanders who say rising prescription drugs costs put their financial security at risk. And that leads to difficult choices. “I am unable to afford the thousands of dollar co-pays for the rheumatoid arthritis drug Embrel…I had to skip dosages,” wrote Mark, a member from Rhode Island. But he and others took action. Enough is enough, they agreed. This long, hard fight by AARP was won with the support of thousands in Rhode Island who urged Congress to reach bipartisan agreement on ways to lower costs. 

“For too long, big drug companies have fleeced our country and padded their profits by setting outrageous prices, all at the expense of American lives,” said AARP Executive Vice President and Chief Advocacy and Engagement Officer Nancy LeaMond. “The number one reason seniors skip or ration their prescriptions is because they can’t afford them. This must stop. 

“Allowing Medicare to negotiate prices for these first 10 drugs will finally bring much needed access and relief to American families, particularly older adults,” she added. “We cannot overstate how monumental this law is for older Americans’ financial stability and overall health.” 

In the long run, Medicare beneficiaries who often must pay a percentage of a drug’s cost would benefit directly from lower negotiated prices, and the government could use the money saved to shore up Medicare’s finances. Negotiations will be expanded to include additional drugs in the years ahead, which will magnify the savings. Lower Medicare spending also is expected to lead to lower Part D premiums. 

The legislation caps the out-of-pocket cost of insulin for Medicare beneficiaries at no more than $35 for a month’s supply. That’s welcome news for more than 11,000 Rhode Island Medicare beneficiaries who use insulin. 

While Medicare Part B covers vaccines such as the flu vaccine at no cost-sharing, patients receiving vaccines covered under Medicare Part D, such as the vaccine for shingles, must pay for a portion of the cost out of pocket. Starting in 2023, the legislation will require $0 cost-sharing for vaccines for Medicare Part D beneficiaries. About 15,000 Rhode Island Medicare beneficiaries received a Part D vaccine in 2020, and that number is likely to rise as those vaccines become more affordable. 

When Congress first added a prescription drug benefit to Medicare nearly two decades ago, the law explicitly forbade the program to negotiate drug prices with pharmaceutical companies. AARP has been one of the most outspoken advocates for changing that policy. 

Medicare is scheduled to choose 15 additional drugs for negotiation in 2027, another 15 in 2028 and 20 more medications annually starting in 2029.

The nonpartisan Congressional Budget Office has estimated that the negotiations provision of the new law will save Medicare $98.5 billion over 10 years.

However, the fight isn’t over.

“The big drug companies and their allies continue suing to overturn the Medicare drug price negotiation program to keep up their price gouging,” added Nancy LeaMond. “We can’t allow seniors to be Big Pharma’s cash machine anymore. AARP will keep fighting to protect Medicare negotiation from any efforts to undo or weaken it, so all older Americans can afford their lifesaving medicines.” 

AARP Rhode Island will continue to press Congress to lower prescription drug prices. Our Volunteer Federal Liaison Team, which meets regularly with members of the Congressional Delegation, will keep this issue, along with strengthening Medicare, protecting Social Security and supporting family caregivers among our top priorities. 

You can learn more about AARP Rhode Island’s volunteer advocacy efforts at both the federal and state level by following us on social media and by logging on to Associate State Director for Advocacy Matt Netto’s blog at aarp.org/RINotes.

We’ll keep fighting and continue to make our voices heard!