Trump's drug plan could lower total spending, but increase patient costs, study finds

While a new proposal from the Trump administration may lead to reductions in overall prescription drug spending, some Medicare beneficiaries could see their out-of-pocket costs increase, according to a study published in JAMA Internal Medicine.

Five things to know:

1. Among President Donald Trump's proposals to lower drug costs, one plan would shift coverage of some drugs from Medicare Part B, which covers most physician-given drugs and biologic agents, to Medicare Part D. Medicare Part D is administered by private health plans.

2. For the study, researchers from Boston-based Brigham and Women's Hospital and the University of Zürich and University Hospital Zürich in Switzerland wanted to estimate how the shift would affect total drug spending and patient out-of-pocket costs. They studied 75 brand-name drugs with the highest Part B expenses for fee-for-service Medicare members in 2016.

3. The study estimated that at 2018 prices, annual Medicare Part B spending across the 75 drugs was $21.6 billion. Under President Trump's proposal, the researchers predict Part D drug spending for the 75 drugs would range from $17.6 billion to $20.1 billion after rebates, representing a 6.9-18.3 percent decrease in drug spending when compared to Part B.

4. The study authors projected the change would decrease out-of-pocket costs by about $860 for Medicare beneficiaries without Medicaid or Part B supplemental insurance. However, for beneficiaries with Medigap insurance, Part D out-of-pocket costs exceeded average Medigap premium costs by about $1,460 for beneficiaries with Part D coverage and $1,952 for those without Part D coverage.

5. "In the interim, while the potentially offsetting effect of reforms on premiums would need to be assessed, HHS could consider capping out-of-pocket costs, or sharing some of the savings from increased rebates with beneficiaries," the authors concluded. "As it implements this proposal, HHS should ensure that the proposed reforms benefit both patients and payers."

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