The Affordable Care Act Saved 6.6 Million Medicare Beneficiaries $7 Billion on Prescription Drugs
Last month, the Department of Health and Human Services (HHS) announced that since the passage of the Affordable Care Act, more than 6.6 million people with Medicare have saved more than $7 billion on prescription drugs. That’s an average of $1,061 per beneficiary.
These savings are thanks to the provision in the Affordable Care Act that closes the gap in Medicare Part D coverage, often referred to as the doughnut hole, over time. Under Medicare Part D, beneficiaries pay part of the cost of their prescriptions until they reach a certain cost limit. Then, they enter the coverage gap. Before the passage of the Affordable Care Act, when beneficiaries reached this gap, they were responsible for the full cost of prescriptions until they hit another cost limit and catastrophic coverage began. In this coverage gap, beneficiaries had to shoulder the entire cost of their prescriptions, which made important medications unaffordable for many. The Affordable Care Act is changing this by phasing in discounts for brand name and generic prescription drugs while beneficiaries are in the coverage gap. By 2020, the discounts will effectively close this gap.
As these discounts have been phased in, beneficiaries are seeing an increase in savings. Since HHS released 2012 savings numbers for Medicare beneficiaries in April 2013, the amount saved has increased from $706 per person to $1,061 per person.
Medicare beneficiaries are also saving money on health care services. The Affordable Care Act made certain preventive services available for free, which has resulted in 16.5 million beneficiaries using at least one free preventive service in the first six months of 2013. The preventive services covered by the Affordable Care Act, such as cancer screenings, allow patients to work with their doctors to better prevent disease, detect problems early when treatment works best, and monitor health conditions.
Many Medicare beneficiaries live on fixed incomes, so every little bit of money saved goes a long way. Since the passage of the Affordable Care Act millions of Medicare beneficiaries have saved billions of dollars on out-of-pocket costs and stand to save billions more as the health care law continues to be implemented.