Seniors have saved $3.5 billion on prescription drug costs thanks to an Affordable Care Act provision that closes the coverage gap — known as the “doughnut hole” — in their Medicare Part D plans. But if the Supreme Court strikes down Obamacare later this month, these drug savings could end, according to a drug industry spokesman.
Drug makers pledged $80 billion over 10 years to cut doughnut hole expenses for consumers during the health care reform debate. But without the law’s legal framework, “there are many questions that arise about whether the discount program could continue,” Matthew Bennett, a spokesman for the Pharmaceutical Research and Manufacturers of America (PhRMA), told Kaiser Health News:
But if there is no law to ensure the coverage gap discount, drug makers are concerned that other laws might prohibit it, Bennett said.
For example, drug companies could try to offer the discounts on their own but that effort could run afoul of federal antitrust laws that generally prohibit businesses from agreeing together to set prices for their products. An individual drug company could offer Part D members coverage gap discounts, but it would have to steer clear of anti-fraud laws that ban a company from giving something of value to persuade beneficiaries to use its products.
Nearly one in four seniors “reported skipping doses, cutting pills in half or not filling a prescription, simply due to cost,” before health reform became law. And now, if the Supreme Court rules against the measure, it could put their drug discounts in danger.
At the same time, Medicare participants’ loss would be pharmaceutical companies’ gain because they would not have to shell out $80 billion to help fix the prescription coverage doughnut hole. One CEO estimated that closing the gap would cost his company between $20 million and $30 million in annual revenue. But without the Affordable Care Act, that would be $20 million to $30 million coming out of seniors’ pockets instead.
Obamacare is expected to completely close the prescription coverage gap by 2020.