Tag Archives for Medicare Part D

Medicare Savings Program bill will be a win for low income seniors, and Rhode Island

Published in RINewsToday on March 25, 2024

A few weeks ago, advocates for seniors gathered on Smith Hill, attending a Senate Committee on Health & Human Services hearing to push for passage of S. 2399.  The legislation would expand income eligibility for the Medicare Savings Program (MSP), helping many lower income seniors and disabled residents pay their $175/month Medicare Part B premium and covering co-pays and deductibles for those with very low-income.

Thousands of low-income seniors and persons with disabilities on Medicare, but not eligible to participate in the state’s Medicaid program, struggle to pay their Medicare Part B premiums and co-pay costs for services and prescription drugs causing many to forgo needed health care as they cannot afford to pay the co-payments.

S. 2399, introduced by Pawtucket Sen. Sandra Cano (D-Dist. 8, Pawtucket), would expand eligibility for the Medicare Savings Program (MSP) by increasing the income limit to 186% of the federal poverty line and eliminating the strict asset limit.  It also increases from 100% to 138% of the federal poverty line a part of the program that covers deductibles and co-payment.

S. 2399 was heard on March 12, 2024 and held for further study.  At press time, H. 7333, introduced by Pawtucket Rep. Karen Alzate (D-Dist. 60, Pawtucket, Central Falls), has been referred to the House Finance Committee for consideration. No hearing date has been scheduled.

“With health care costs rising at an alarming rate, it is imperative that we make sure that no one goes without the care they need due to unaffordability.  This bill adapts to the significant changes in our society and economy while also ensuring that our most vulnerable senior and disabled residents are able to access the care and medicine that is essential to their daily lives,” said Cano, who champions S. 2399 and in previous legislative sessions introduced legislation to expand the MSP.

“Too many of our low-income seniors and disabled residents are falling through the cracks and foregoing crucial health care services due to rising co-pays and out of pocket costs.  This is unacceptable, but thankfully, we can do something about it.  By passing this legislation, thousands or more Rhode Islanders will be able to receive the care that they desperately need while also keeping more money in their pockets that’s needed for daily living expenses,” said Alzate, who sponsored the House companion measure.

“We understand this is very important legislation. We had a very informative, thorough hearing on this bill, and I look forward to reviewing all the information we collected.” says Senate Health and Human Services Committee Chairman Joshua Miller (D-Dist. 28, Cranston, Providence).

The Policy Problem and its Solution  

Currently, the income limit of $20,331 leaves thousands of older Rhode Islanders and disabled low-income persons on Medicare with significant gaps in coverage and hefty out of pocket costs.

If the MSP income limit is increased to $28,012, as required by the legislation, an estimated 17,000 persons would be newly eligible to have their Medicare Part B covered by being enrolled in MSP. Anyone enrolled in the MSP receives automatic enrollment in Part D “Extra Help,” a federal program which significantly lowers out-of-pocket Medicare prescription costs at no cost to the State. The federal government establishes the minimum income and asset thresholds for the MSP, and states are permitted to increase these limits and many have done so. 

Advocates of Cano’s MSP legislative proposal say it also particularly helps Rhode Island’s older woman and minorities. “Since women and people of color and persons with disabilities are disproportionately represented in low-income populations, increasing access to the MSP promotes equity,” finds an advocacy partnership’s analysis of the legislative proposals. “Poverty rates among older adult Hispanic women are two and one-half times that of older Hispanic men and persons age 18 and over with disabilities are twice as likely to live below 150% of the poverty level, said the analysis.

The advocacy partnership’s analysis also noted that significant numbers of older adults and those with disabilities enrolled in Medicare face financial challenges meeting basic needs. The number of older adults living below or near poverty has increased, housing costs have climbed dramatically, food cost have increased and many more rely on food pantries.

Covering the $175/month Medicare Part B premium for 17,000+ Rhode Islanders (at no cost to the State) and additionally covering co-pays and deductibles for thousands of very low-income adults and persons with disabilities on Medicare will give them much needed financial relief.  And enrollment in the Extra Help program to reduce drug-related costs provides significant additional financial assistance and improves access to critical medication.

Testimony At the Senate Committee Hearing

Nine organizations either testified at this hearing or submitted written testimony to urge passage of S. 2399.  AARP Rhode Island did not testify at the hearing but signed up in support in the committee room.  There was no opposition to Cano’s legislative proposal.

“I first became aware of the need to expand the income eligibility for MSP quite a few years ago when an older man in my neighborhood contacted me to tell me he lost out on the program because he was just a few dollars over the income limit. As a result, the Senior Agenda Coalition of RI (SACRI) has advocated for several years to increase the income cap,” says Maureen Maigret, SACRI’s policy Advisor.

It’s a win-win for both older Rhode Islanders  and for the Rhode Island General Assembly, says Maigret. “S. 2399 would help Medicare beneficiaries to access care along with putting money back in their pockets to pay for food, rent and their basic needs.  By increasing the Medicaid income to $28,012, the federal  government will pay the full cost of the newly eligible Medicare beneficiaries,” she told the lawmakers.  

Strongly supporting S2399, Karen Malcolm, of Protect Our Healthcare Coalition, noted that the legislative proposal is modeled on the MSP changes enacted in New York last year and approved by the Centers for Medicare and Medicaid Services. “Rhode Island should take advantage of the opportunity to expand access to affordable coverage for seniors and people with disabilities and bring new [federal] revenue to our state.”

H. Phillip West, Jr. lobbyist for the Village Common of Rhode Island, states MSP already makes an enormous difference for many beneficiaries. But, “Rhode Island’s low threshold for eligibility and low allowable assets leaves thousands of our needy neighbors out. The good news is that Senator Cano’s legislation address these defects,” he said.

In submitted written testimony, Heather Smith, MD, president of the Rhode Island Medical Society stated “From our perspective as physicians, we witness firsthand the adverse effects of financial barriers on patient health outcomes. Too often, individuals are forced to forgo or ration medications, delay necessary treatments, or skip preventative care due to concerns of affordability. These delays can exacerbate health conditions, lead to complications, and ultimately result in higher healthcare costs down the road.”

Alex Moore, political director of SEIU 1199NE, stressed the many benefits of passing S. 2399, specifically enhancing access to care, providing needed financial  relief, leveraging federal funds, and strengthening the health care workforce. By supporting the legislative proposal, “we demonstrate our commitment to health and well-being of our state’s most vulnerable populations,” he stated in written testimony.

Even with the strong support of the aging community, the state’s Office of Healthy Aging has not yet taken an official position on S. 2399.  “As with any other bills at this stage of the session, we are reviewing the impact of H 7333 and S 2399 on Rhode Islanders. We will continue to follow these bills as they make their way through the legislative process,” says  Director Maria Cimini.

Samuel Salganik, JD, executive director of RIPIN, which offered testimony in support for S.2399, said, “This is one of the best investments available right now for our state government.  At a cost of just over $5 million, the State can draw down more than $40 million in federal support to assist low-income seniors in Rhode Island,” says Salganik. “It’s a great deal for the state. I think that’s a deal that most of us would happily take,” adds Salganik.

Gov. Dan McKee’s recently released FY 2024 Budget does not include funding for to expand the state’s MSP.  Now the ball is in House Speaker Joseph Shekarchi’s (D-Dist. 23, Warwick) court as his chamber collaborates with the Senate to hammer out budget resolution to be approved by the Rhode Island General Assembly to be sent for the Governor’s signature. Hopefully, Shekarchi will see the expansion of the state’s MPM as a win-win for lower-income and disabled persons on Medicare and the state.  As supporters of  S 2399 and H 7333 say, “it’s a no brainer.”

The Advocacy Partners for MSP Expansion was established to push for the passage of S 2399 and H 7333 during this legislative session. They are: the Senior Agenda Coalition of Rhode Island, Rhode Island Organizing Project, RIPIN, the Economic Progress Institute, the Protect Our Healthcare Coalition and the Ocean State Center for Independent Living.

To access the bills under consideration: http://webserver.rilegislature.gov/BillText/BillText24/SenateText24/S2399.pdf – http://webserver.rilegislature.gov/BillText/BillText24/HouseText24/H7333.pdf

Expanding the income eligibility for the Medicare Savings Program (MSP) is one of the legislative priorities of the Senior Agenda Coalition of Rhode Island. These policy issues will be discussed at its upcoming  Legislative Leaders Forum scheduled on Wednesday, March 27, 2024, from 10:00 a.m. to 11:00 a.m., at the Crowne Plaza Hotel, 601 Greenwich Ave,, Warwick, RI. 

The Senior Agenda Coalition of RI’s Annual Legislative Leaders Forum is this week:

Wake up call on spiraling brand-name drug prices 

Published in RINewsToday on August 14, 2023

By Herb Weiss

A new pharmaceutical drug price report that is both timely and overdue has been released by AARP’s Public Policy Institute, following on the heels of the Centers for Medicare & Medicaid Services (CMS) releasing in June, which revised guidance for the historic Medicare Drug Price Negotiation Program.  

This report details the list prices for the 25 brand-name drugs with the highest total Medicare Part D spending in 2021, noting that prices have increased by an average of 226%—or more than tripled—since they first entered the market. Those 25 drugs were responsible for $80.9 billion in total Medicare Part D spending in 2021, about 37% of the total spending, and were used by more than 10 million Part D enrollees.  It noted that, on average, nearly 60% of their current list price was due to price increases after the product entered the market.

The price of Enbrel, used to treat rheumatoid arthritis and psoriatic arthritis, has increased by 701% since coming to market in 1998, and the price of Januvia, used to treat diabetes, has increased by 275% since entering the market in 2006.

Overall, the lifetime price increases ranged from 20% to 739%, and all but one of the drugs’ lifetime price increases greatly exceeded the annual rate of inflation over the same period of time. 

Brand-name drug prices increase faster than inflation has – for decades

“Brand-name drug prices have increased dramatically faster than inflation for decades,” said Leigh Purvis, Prescription Drug Policy Principal, AARP Public Policy Institute, and author of the report.  “The median price of a new brand-name prescription drug is now approximately $200,000 per year, so even relatively small percentage price increases can translate into thousands of dollars and put life-saving medications out of reach of the patients who need them,” she said. 

“We know that there is lot of media attention on individual drug prices that take place year after year.  However, a lot less attention is paid to how those price increases are often building on top of a long line of price increases and how those relentless price increases add up over time,” says Purvis, during a press call to journalists scheduled on the day of the report’s release.

“These findings have huge implications for the people that AARP represents, many of whom need prescription drugs to help them stay well,” Purvis said. “People on Medicare prescription drug plans take on average of between 4 and 5 prescription drugs per month and their drugs are increasing covered using coinsurance where you pay a percentage of the drugs price instead of a flat co-pay.  In fact, across the country more and more people are facing cost sharing directly affected by drug price increases, whether it is by coinsurance or simply before they meet their deductible.  Millions of other people don’t have health coverage and are having to absorb the cost associated with growing drug prices on their own,” she said.

“Our analysis shows that drugs that have been on the market for twenty years or more have seen an average lifetime price increase of 592 percent.  In real terms this can be the difference of thousands of dollars for one person and enough to force the trade-offs that we often hear about, like choosing to put food on the table or being able to pay for gas,” notes Purvis.

“There is no justification for drug companies to engage in these type of price increases every year they are on the market, particularly increases that are so much higher than the price increases for other goods and services,”  adds Purvis. 

CMS releases revised guidance for negotiating with drug manufacturers 

Congress recently passed the Inflation Reduction Act (IFA), a federal law requiring drug companies to pay a penalty to Medicare if their drug’s price increases faster than the rate of inflation. The law will also give Medicare the ability to negotiate lower drug prices with drug companies for the first time. CMS is expected to announce the first 10 drugs selected for negotiation by September 1st, and the negotiated prices will become available in 2026.

“This historic law cracks down on the big drug companies and [will bring] real relief to millions of seniors who have been struggling with out-of-control prescription drug prices,” said Nancy LeaMond, AARP Executive Vice President and Chief Advocacy and Engagement Officer. “American families simply can’t afford to keep paying the highest prices in the world for the medications they need.”

Last March, CMS issued initial guidance to seek comments on its historic Medicare Drug Negotiation Program.  The agency received over 7,500 comments from consumer, patient groups, drug companies and pharmacies.  In June, CMS released its revised guidelines detailing the requirements and parameters of how the agency will oversee the new program.

“Issuing final guidance for the Medicare Drug Price Negotiation Program is an important “next step” in controlling spiraling high drug prices, says AARP’s LeaMond, noting that Medicare’s new buying power will get a better price for Medicare beneficiaries, saving the program billions of dollars and making prescription drugs more affordable.

Opposition, of course

At press time, the Pharmaceutical Research and Manufacturers of America (PhRMA), the leading industry lobby group for pharmaceutical companies, along with a group of pharmaceutical companies and trade groups, are suing the U.S. Health and Human Services to block the implementation of the Medicare Drug Price Negotiation Program established by the Inflation Reduction Act enacted by President Biden last August. The U.S. Chamber of Commerce has also filed a lawsuit in a U.S. District Court in Ohio to ask for an injunction to keep the negotiations from going forward. The trade group is challenging the constitutionality of the IFA’s drug price negotiation program.   

It’s a very high lift and big burden to meet the standard to stop the law from being implemented,” noted Kelly Bagby, AARP’s Vice President at AARP Foundation Litigation, before AARP’s press call ended.

“It is entirely appropriate and is necessary and the public interest is so enormous in balancing of the government’s interest verses the pharmaceutical companies and Chamber’s interest in this case,” says Bagby,” stressing that beneficiaries have to win this case. “It’s so obvious that pharmaceutical companies are not the victims they are painting themselves to be, she adds, affirming her belief that beneficiaries and Medicare have the strongest argument.  

Bagby noted, “AARP is working to protect the integrity of whole Medicare program for everybody and to allow for older people to not have to make horrible choices about do I pay my rent or do I get to take my life saving drugs.” 

Reports a Wake-Up Call

Although PhRMA,  pharmaceutical companies and trade groups along with the U.S. Chamber are strongly opposed to CMS’s new program to negotiation drug prices, polls show that people aged 50 and over, view the lowering of the price of costly prescription drugs to be a very important policy issue to them. Purvis hopes that the recently released AARP report will serve as a wake-up call for every American who is skeptical about the importance of lowering prescription drug prices. “Higher government spending driven by drug price increases will affect all Americans in the form of higher taxes, cuts to public programs, or both,” she predicts.  

For a copy of AARP’s Medicare Part D Drug Price report, go to https://www.aarp.org/pri/topics/health/prescription-drugs/prices-top-medicare-part-d-drugs-tripled-since-entering-market.html.

Trustee reports: Social Security and Medicare still face financial woes

Published in RINewsToday on April 10, 2023

Over a week ago, the Trustees of the Social Security and Medicare trust funds released their annual reports on the financial health of these two programs. As in prior years, the trustees found that the Social Security and Medicare programs both continue to face significant financing issues.

The latest Social Security projections show the program is quickly heading toward insolvency and calls for Congress to find policy solutions sooner rather than later to prevent abrupt changes to tax or benefit levels.  The Washington, DC-based National Committee to Preserve Social Security and Medicare (NCPSSM) and other aging advocates are urging Congress to take prompt action to strengthen and expand Social Security, while Republicans have been calling for cuts to future retirees’ benefits and at least partly privatizing the program. 

This 270- page 2023 Social Security Trustees Report warns that if Congress does not act, Social Security’s Old-Age and Survivors Insurance and Disability Insurance (OASI and DI) Trust Funds, which help support payouts for the elderly, survivors and disabled, will become depleted in 2033 (that’s a year earlier than forecast last year), becoming totally insolvent in 2034 when beneficiaries would only receive about 80% of their scheduled benefits. 

According to the Social Security Administration (SSA), roughly 66 million people received monthly Social Security checks in 2022 (175,840 in Rhode Island). A vast majority, or about 57 million of those beneficiaries, received benefits through the OASI Trust Fund, compared to nearly 9 million people who received benefits through the DI Trust Fund. 

The trustees say that Social Security funds would be fully depleted in 2034 because of expectations of a slowed economy and reduce labor productivity, considering inflation and economic input.

Although the DI Trust Fund asset reserves are not projected to become depleted during the 75-year projection period, being able to pay full benefits through 2097, the combined Social Security funds would only be able to pay 80% of the scheduled benefits after 2034, says the trustees report.

Taking a look at Medicare’s fiscal health

Medicare, the hospital insurance trust fund referred to as Medicare Part A, will only be able to pay scheduled benefits in full until 2031, according to the 273-page trustees’ annual report. The program covered 65 million seniors and people with disabilities in 2022, and will only be able to cover89% of total scheduledbenefits at that time.

Although the Medicare Part A Hospital Insurance trust fund will become insolvent in just eight years, Medicare spending as a whole (including Parts A, B, D, and Medicare Advantage, will continue to grow over the coming years.

The Medicare Trustees project a shortfall of 0.62 percent of payroll, or 0.3 percent of Gross Domestic Product (GDP), noting that it would take about a 21 percent (0.6 percentage point) increase in the payroll tax rate or a 13 percent spending cut to restore the program’s solvency.

The improvement of Medicare’s hospital trust fund’s finances over last year’s projections can be tied to lower estimates for health care spending after the height of the Covid-19 pandemic along with more projected income that the trustees estimate coming from a larger number of covered.

Dueling political statements

With the Social Security and Medicare Trust Fund reports released on March 31, 2023, the Chair and Ranking Members of the House Ways and Means (HWM) were quick to issue dueling statements to give their political spins. HMW’s Subcommittee on Social Security has jurisdiction on bills and matters related to the Social Security Act.

House Ways and Means Chairman Jason Smith (R-Missouri) charged that reckless Democratic spending has impacted the financial viability of the Social Security and Medicare Programs.  “Thanks to President Biden’s economic failures, seniors’ hard-earned benefits are further under threat. Social Security’s combined trust funds are expected to become insolvent a full year sooner than forecast in the previous report as a result of a slowed economy and Democrats’ inflation continuing to outpace wage growth. And Medicare’s latest report comes amidst Biden’s plans to slash seniors’ access to innovative new cures and treatments,” says Smith, stressing that “the first step to protecting these programs is “growing the economy – not budget gimmicks or tax increases that hold back economic growth.

On the other hand, House Ways and Means Committee Ranking Member Richard E. Neal (D-MA) counters Smith’s political perspective. “While Democrats are committed to the long-term health of these programs, Republicans are launching another shameful assault on the economic well-being of millions of workers and retirees with their plan to make drastic cuts to Social Security and Medicare, warns Neal. “Their playbook is clear: slashing a critical resource that Americans have rightfully earned to give another tax cut to the top 1%. Democrats won’t let their reckless attacks stand, and we will continue to defend and protect Social Security and Medicare for generations to come.”

Rhode Island Congressmen were quick to give their comments about the release of the two trustee reports, too. “Unlike the nearly three-quarters of House Republicans who endorsed slashing Social Security in 2022 – reducing benefits by $729 billion over 10 years – House Democrats are working to protect Social Security for generations to come,” says Congressman David N. Cicilline, representing Congressional District 1.  Cicilline, who is retiring his seat on May 31, 2023, has pushed to expand and strengthen Social Security over his six-terms in office.

Cicilline asks: “Sixty-six million Americans rely on this essential program to make ends meet and we cannot allow Republicans to make any cuts to this hard-earned benefit. The drug spending savings implemented by our Inflation Reduction Act will not only keep money in seniors’ pockets but will also drive down costs to Medicare itself. We’ve been taking real action to strengthen these programs and help our seniors – what have Republicans done?”  

As Rhode Island’s newly elected Congressman, Seth Magaziner says he will “fight tooth and nail to protect Rhode Islander’s hard-won Social Security benefits.”   In responding to the trustee’s report about Social Security’s financial woes, Magaziner called for raising the cap on Social Security taxes, forcing “millionaires and billionaires to pay the same rate as teachers and fire fighters.”

“I stand ready to work with anyone who is serious about strengthening Social Security, not cutting hard-earned benefits,” says Magaziner. 

While there are few fixes being proposed by either party or leader, some fixes identified by the Program for Public Consultation at the University of Maryland that “Americans might be willing to support” include:

–        raising the Social Security payroll tax cap

–        reducing benefits for high earners

–        gradually raising the retirement age

–        increasing the payroll tax

–        raising the minimum benefit

–        changing cost-of-living adjustment calculations

–        increasing benefits for beneficiaries over age 80

Social Security advocacy group gives its two cents

“Contrary to conservative claims, Social Security is not ‘going bankrupt’; the program will always be able to pay benefits because of ongoing contributions from workers and employers. In fact, this is yet another Trustees report showing that Social Security remains strong in the face of turmoil in the rest of the economy,” says Max Richtman, NCPSSM’s President and CEO in a release on the Social Security Trustee Report. He notes that the program’s insolvency date has stayed roughly the same even after a global pandemic and recent economic upheavals. 

Congress can strengthen Social Security by bringing in additional revenues into the program, says Richtman.  NCPSSM endorses legislation introduced by Senator Bernie Sanders (D-Vermont) and Congressman John Larson (D-Connecticut) to keep the trust fund solvent for the rest of this century while expanding program benefits.  Both bills would adjust the Social Security payroll wage cap so that higher-income earners begin contributing their fair share, he notes.

As to Medicare, in a release Richtman called on Congress to take “pre-emptive action now” to protect the Medicare Part A trust fund from becoming depleted in 2031, three years later than estimated in their previous report, at which time Medicare could still pay 89% of benefits.  

“Beyond trust fund solvency, the Trustees reported that the standard Medicare Part B premium will rise next year to $174.80 per month – a $10 or six percent monthly increase,” says Richtman. “Any increase is a burden to seniors living on fixed incomes, who too often must choose between paying monthly bills or filling prescriptions and getting proper health care.  Seniors need relief from rising premiums and skyrocketing out-of-pocket health care costs,” he said. 

“We support President Biden’s plan to strengthen Medicare’s finances, as laid out in his FY 2024 budget.  His plan would bring more revenue into the program, rather than cutting benefits as some Republicans have proposed.  Building on the prescription drug pricing reforms in the Inflation Reduction Act, the President’s budget proposal would lower Medicare’s prescription drug costs — and some of those savings would be used to extend the solvency of the Part A trust fund,” said Richtman.

For a copy of the 2023 Social Security Trustee Report, go to https://www.ssa.gov/OACT/TR/2023/.

For a copy of 2023 Medicare Trustee Report, go to https://www.cms.gov/oact/tr/2023.