Adios Prescription Drug Donut Hole!

Yes this has been a long time coming but to the best of my knowledge this new law doesn't take effect until 2025. I am 77 and in reasonably good health but it is not a given I will still be around then. I guess we will all see how it plays out.

This plan is great news. One comment on hitting the current donut is I believe it is based on your drug costs, hitting $4,430, not your out of pocket. You really can’t hit the donut way before you out of pocket reaches $4,430. Your catastrophic coverage is based on out of pocket. If I’m wrong please let me know.

Great clarifications folks. First, Bill is correct, the coverage gap begins after you and your drug plan have spent a certain amount for covered drugs ($4,430 currently). So you are not out of pocket all of that $4,430. Secondly, Kathy is also right, although parts of the law go into effect immediately. In 2023 drug companies have to pay rebates to Medicare if their prices rise faster than inflation, and monthly insulin charges are capped at $35 for Medicare recipients. In 2024 the 5% copay above the catastrophic limit goes away. In 2025 the donut hole is eliminate, capping out of pocket expenses at $2,000 annually for Part D recipients. We have clarified the original article to add these distinctions.

Still no news on cancer drugs? That seems to be the big issue and potential explosive costs to Medicare recipents, as Medicare is slowly moving cancer drugs to OOP status

https://www.forbes.com/sites/forbesfinancecouncil/2019/11/18/medicare-out-of-pocket-costs-for-cancer-treatment-every-retiree-should-know/?sh=2cdb2f6b4b4d

Having read this new law, it only applies if you subscribe to medicare part D. As a Federal retiree I don't buy part D, OPM has stated my Federal insurance I carried into retirement meets the requirement I don't have to buy D. So I am still screwed on insulin?

These laws should take affect immediately not years down the road.

Looks like Medicare is going to keep gouging people for the unfounded premium increase over that Alzhiemer? drug they wrongly assumed was going to cost them under federal mandate. They were asked what about that? No comment thus far

So today BIG Pharma announced news about a "promising new drug for Alzheimer's. Forgive me if I am skeptical. Nobody knows better than I as a retired geriatric nurse how such a drug is needed.
Also medicare announced the new premium for medicare part d for 2023. I am underwhelmed about a seven dollar decrease. Once again the seniors take a hit.

Recently I have been seeing TV ads attacking the Medicare drug negotiation section of the Inflation Reduction Act. Terms used to mislead include “price setting schemes”, the bill doesn’t set prices it allows price negotiation and initially only on10 drugs starting in 2026 with another 10 added as the years go by. The ads say the “government” not your doctor will decide which medications you get, the same lie was used to oppose the Affordable Care Act years ago. The ads claims that Medicare is being “raided” for $287 billion so “liberals” can use it for other “big government programs” or to “pad big insurance profits” but the $287 billion is the amount that medicare will save over 10 years by lower prices. Of course the ads must scream “SOCIALISM” while ignoring the $230 billion in taxpayer funding provided to the pharmaceutical industry for every new drug approved between 2010-2019. In 2022 the taxpayer invested nearly $45 billion in private research.

Soon after the IRA was passed pharmaceutical companies threatened to sue over the drug negations, the lawsuits are now underway with claims of “extortion.” I have not heard that term use when commercial insurance companies negotiate prices, or when the Veterans Administration, the Department of Defense, Medicaid or the 304 B program negotiate prices, as they have done for years, resulting in reducing those agencies drug spending by nearly a quarter. One company has said they will slow down the production of drugs to lessen the time it would be eligible for price negotiations.

Meanwhile drug companies are making massive profits and spend more on stock buybacks than they do on research (same goes for advertising) and spent over $375 million on lobbying in 2022. The Pharmaceutical Research and Manufacturers of America trade association behind some of the ads spent
$29,236,000 by itself in 2022. The payoff for that spending? We pay the highest prices for medications resulting in the highest profits for pharmaceutical companies in the world.

A recent study says:

U.S. sales of the 20 top-selling drugs worldwide totaled $101.1 billion while sales to the rest of the world totaled nearly $57 billion. In other words, the U.S. spent almost double what the rest of the world combined did on these top 20 drugs:

For 17 of the 20 top-selling drugs worldwide in 2020, pharmaceutical corporations made more money from U.S. sales than from sales to all other countries in the rest of the world combined.

For 11 of the 20 top-selling drugs worldwide, U.S. sales revenue was double revenue to the sales of the rest of the world or more.

11 of the 13 pharmaceutical companies selling these top drugs made more money in the United States from these drugs than they did in the rest of the world combined.

The White House has announced the first 10 drugs selected for price negotiations:
https://www.whitehouse.gov/briefing-room/statements-releases/2023/08/29/fact-sheet-biden-harris-administration-announces-first-ten-drugs-selected-for-medicare-price-negotiation/

Here is an update on annual Part D coverage stages:
Stage 1. You pay the full cost of drugs up to a deductible of $545
Stage 2. You and the plan both pay their shares until total drug costs reach $5,030.
Stage 3: You pay 25% of drug costs until yearly out of pocket hits $8,000.
Stage 4: The plan pays all the costs of covered Part D drugs. You stay in this stage for the rest of the calendar year.

Admin, I’m assuming your update covers the current state of Part D in 2024. Do you know if it changes much from this in 2025? Thanks.