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Prescription ‘donut hole’ closing for many on Medicare

By GUY KOVNER
THE PRESS DEMOCRAT

President Barack Obama’s health care plan may be a hot issue in the politics of 2012, but to 2,000 Sonoma County residents — and more than 120,000 people statewide — it amounts to cold cash.

A provision of the Affordable Care Act has accounted for $1.16 million in prescription drug discounts to 2,004 Medicare recipients this year in Sonoma County, the federal Centers for Medicare & Medicaid Services said.

Statewide, the savings for 121,587 elderly and disabled Medicare beneficiaries amounts to $69.5 million for an average of $572 per person in the first seven months of the year.

County Supervisor Shirlee Zane said the cash flow was a “payoff” from the health care act, calling it a “win-win-win” for health care, seniors and the economy.

Virtually every dollar that seniors save on prescription drugs will be spent on food, transportation and entertainment, said Zane, a former CEO of the nonprofit Council on Aging.

“That’s huge,” she said. “That’s money reinvested back into our economy.”

Nationwide, 1.4 million Medicare recipients have saved nearly $885 million this year on prescription drugs as a result of the health care law’s provisions to plug the Medicare Part D coverage gap known as the doughnut hole.

Until health care law provision went into effect in 2010 Medicare beneficiaries had to pay 100 percent of their annual drug costs between $2,700 and $4,350 a year This year, the law gives them a 50 percent discount on brand-name drugs in the doughnut hole between $2,930 and $4,700.

Drug companies were required by the law to offer the discount to maintain participation in the Medicare Part D program.

Since 2010, the doughnut hole savings amount to more than $4 billion nationwide, including $340.6 million in California, tops among the 50 states, the government said.

Starting next year, the discount will be increased each year until it reaches 75 percent in 2020, eliminating the doughnut hole and enabling Medicare beneficiaries to pay 25 percent of the cost of all their drugs up to the annual out-of-pocket spending limit.

During her Council on Aging tenure, Zane said she saw the impact of drug prices on seniors who fell into the doughnut hole. Many resorted to strategies like cutting their pills in half.

A 79-year-old Cazadero resident said she quit taking three of her five prescriptions when hit by “devastating” cost increases.

Along with the doughnut hole drug discount, the health care law also is making preventive services — such as breast and colon cancer screenings — free for Medicare beneficiaries.

So far this year in California, nearly 1.5 million Medicare beneficiaries — half of those who are eligible — received at least one free preventive service.

Sonoma County has 75,757 Medicare beneficiaries, about 16 percent of the population.





7 Responses to “Prescription ‘donut hole’ closing for many on Medicare”

  1. MOCKINGBIRD says:

    Follower there is no supply and demand. These big drug companies have FIXED the prices of drugs for the America people. They are ripping us off and they need to be controlled. It’s pretty much a monopoly out there. We aren’t talking about limitless government funding. We are talking about people not dying and being able to get the meds that keep them on an even keel. My work involves working with payers of medical expenses and this in one area I have expertise. I know the cost of care. It’s cheaper to keep them healthy than having them hospitalized or chronically using the ER because of a few pills they can’t afford.

    What would you advocate? Life or death? If the prices weren’t fixed people would be able to buy their meds. Americans spend more ON THE SAME DRUGS FROM THE SAME COMPANIES than any other country in the world.

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  2. Follower says:

    @Mockingbird

    The thought (and reality) of people having to do without necessary medication due to lack of financial resources is a horror to anyone with even the slightest little inkling of compassion for your fellow man.
    Democrat OR Republican!

    But when you guarantee the sales of ANY product by mandating limitless Government funds to be used for the purchase of that product you artificially inflate the cost.

    I know the concept of “supply & demand” is a difficult one for liberals to grasp since it is the foundation of Capitalism (am I allowed to post that word in public?) but it’s quite real.

    So you have a “product” that unlike luxury products can mean the difference between life & death so you already have PLENTY of demand. Now inject limitless Tax Payer money for the purchase of that product and guess what happens? THE COST SKYROCKETS!

    Why wouldn’t it? Because “Big Pharma” is known for fairness & honesty?

    Because the Government, a beacon of efficiency and fiscal responsibility is going to keep it under control?

    If you believe either of those you might want to take a look at how much money Big Pharma “donates” to political campaigns and think about “why?”.

    We do have a REAL problem here. People can’t afford medications they need to stay alive or at least live a life free of agony.

    But bankrolling Big Pharma with my tax dollars not only does NOTHING to solve the problem of skyrocketing medical costs, it actually makes that problem worse.

    We have spent DECADES creating this problem. It’s not going to be fixed easily.

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  3. MOCKINGBIRD says:

    For the ignorant out there who are so worried about the money spent on drugs during the donut hole, let me make this CRYSTAL CLEAR. If people CANNOT AFFORD their medications they will do without. Period. A choice between eating and meds you might cut your medications in half or a quarter to “get by”. If you are a diabetic, or on dialysis, or have a heart condition, or a thyroid condition, or any other chronic condition that medication keeps you on a even keel and you cannot afford your medication so you cut it or do without some of it, you will likely end up hospitalized WHICH WILL COST SIGNIFICANTLY MORE. I have seen hospital bills for 3 DAYS that amounted to $150,000. Medicare will have to pay that hospital bill. Which would you rather pay, preventative medicine or huge inpatient hospital bills? Then, will you help those individuals’ families with the funeral expenses if the die?

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  4. MOCKINGBIRD says:

    Reality Check-you are deluded in thinking that drug companies don’t already make primo contracts with other insurance companies. It’s only right, since Medicare is the BIGGEST insurance provider in the country, that they also be allowed to contract for lower cost drugs for their members. We Americans pay higher prices on prescription drugs THAN ANY OTHER COUNTRY for the very same drugs. We’re being fleeced to put money in corporate pockets while they spend some of that very same money on lobbying for favors in Congress and across the state legislatures.

    People who are in the donut hole, and that can include families with a kidney dialysis child who can hit that donut hole in the first 3 months, are very lower middleclass in income. Why should they have to pay something like $7200 more for their medications?

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  5. Follower says:

    Ways to elevate the impact of skyrocketing medical costs on average citizen…

    1. Fuel competition by lifting the interstate restrictions on health insurance.
    2. Relax regulations that prevent “start ups” from entering the medical industry and make it nearly impossible to for small businesses to survive and compete.
    3. Enact “Tort Reform” so your Doctor doesn’t have to charge $50.00 for a band-aid to offset legal costs.
    4. Offer Taxpayer Funded medical treatment for Illegal Immigrants ONCE! …immediately followed by mandatory, permanent deportation. NO”ifs and or buts!” You snuck in, you got sick, we made you better, GO HOME!
    Or…

    Guarantee that only “Big Pharma” and huge, bureaucratic, behemoth industrialized, Government controlled and subsidized “one size fits all”, “evil corporations” can afford to wade through the regulatory maze and reams of grant applications from multiple Government redistributionary, notoriously corrupt and incompetent bureaucracies by using the Printing Press to offset exponentially skyrocketing costs and guaranteeing with an endless flow of increasingly worthless Tax Payer cash that there will be NO END to in sight!

    OBAMACARE. …guess we should have read it before we passed it after all!

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  6. Brown Act Jack says:

    And you wonder why the government is failing to do what is required,
    there is no “flow of money” to the State or County. But it is the type of double think that politicians love

    If you don’t spend money then there is more money to spend and that will increase the economy

    The money in your savings account is all available to spend and that flow of money into the county economy will make the economy expand and allow the county to repair the roads.

    And Dorothy will click her heels together and all will be well in the world

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  7. Reality Check says:

    Eureka! The solution to the high cost of medical care has been found. Simply require all medical provides offer their services at a 50% discount.

    Think of the money saved. Think of the money people will have to spend on “food, transportation and entertainment . . .” as supervisor Shirlee Zane points out.

    With thinking such as this is it any wonder the county is in a world of financial hurt? Do they really think that drug companies won’t pass these supposed savings on to others, probably in the form of higher list prices elsewhere?

    It’s hard to believe the article was written as if it’s a given that pharmaceutical companies will just absorb the $4 billion dollar loss. What idiocy.

    Thumb up 17 Thumb down 4

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