President Barack Obama was joined today by two of the chairmen of the Senate panels overseeing healthcare reform legislation—Max Baucus (D-MT) and Chris Dodd (D-CT)—plus an AARP representative to announce the agreement with pharmaceutical manufacturers to spend $80 billion over the next decade to assist Medicare beneficiaries in defraying drug costs.
Under the deal, drug companies would pay as much as half of the cost of brand name drugs for lower and middle income seniors in the so called doughnut hole, which is a gap in prescription coverage in which the beneficiary pays the full price for medication without help from Medicare. The pharmaceutical companies also have agreed to pick up some of the costs of the president's health reform plan.
"The agreement by pharmaceutical companies to contribute to the health reform effort comes on the heels of the landmark pledge many health industry leaders made to me last month, when they offered to do their part to reduce health spending $2 trillion over the next decade," Obama said in a statement on Saturday.
In response to the announcement, National Community Pharmacists Association (NCPA) Executive Vice President and CEO Bruce T. Roberts, RPh, said Monday that community pharmacists want to lower drug costs, but also need to learn more about the agreement so "to ensure community pharmacies are treated fairly and can continue serving patients."
The NCPA's questions include: when will the program start, how will they calculate the discounts and who will pass them along, and how will pharmacists receive the full reimbursement for prescriptions.
"Community pharmacies must play an important role if health care reform and cost savings proposals such as this are going to be successful," said Roberts.
The deal with the pharmaceutical industry marked a small victory for Sen. Max Baucus (D-MT), chairman of the Senate Finance Committee, who has been negotiating with health industry groups as he was working on drafting health reform legislation with his committee.
Initially, a draft bill was expected from the committee last week. However, Congressional Budget Office questions over costs may have slowed that down; CBO had estimated on Tuesday that the costs of reform legislation may be closer to $1.6 trillion.
Baucus was pushing for the final price tag to be around $1 trillion. A draft summary that surfaced last week showed that the committee was still examining whether to create consumer governed nonprofit medical cooperatives. The committee was also reviewing how to limit the ability of workers to leave employer sponsored health plans in favor of subsidized insurance that would be offered through state exchanges. Mark-up is expected after the July 4 recess.
Meanwhile, hearings continued in the Senate Health, Education, Labor and Pension Committee. Mark-up for the committee had been scheduled for June 26. However, it may take longer than that.
Republicans seemed to be stepping up their resistance to the bill—criticizing Democrats for providing adequate time for reviewing the proposals related to creating insurance programs and restructuring the way providers are paid.