Pharmaceutical Companies to Cut Medicare Prescription Costs By $80 Billion, Helping Assisted Living

The country's leading pharmaceutical industry group has agreed to cut Medicare prescription drug prices by $80 billion over 10 years. President Obama announced it Monday at the White House.

The funding will help to narrow the so-called "doughnut hole," according to the Pharmaceutical Research and Manufacturers of America (PhRMA). The doughnut hole is the gap in Medicare Part D coverage when seniors are responsible for the total cost of drugs. As part of their investment, drug companies will cover up to 50% of the cost of brand-name drugs that fall within the doughnut hole. The new deal would largely benefit lower-income Medicare recipients-one industry official noted. The entirety of prescription costs would also count towards out-of-pocket expenses, meaning insurers would pick up more of the tab.

Standing with Obama at the event, AARP's chief executive Barry Rand told reporters the $80 billion contribution to healthcare cost reductions was "an early win for reform." Still PhRMA's $80 billion represents only a small fraction of the total cost of healthcare reform. The National Center for Assisted Living has been lobbying aggressively for elimination of Medicare Part D co-pays for assisted living residents.  For more, read the story.


Robert W. Carter, Jr. is a Virginia attorney whose law practice is dedicated to protecting the rights of the victims of nursing home and assisted living neglect and abuse in Richmond, Roanoke, Norfolk, Lynchburg, Danville, Charlottesville, and across Virginia. 

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