New York, N.Y. — As inflation continues to cause the cost of living to increase in New York City, today, U.S. Senator Kirsten Gillibrand announced her policy package to reduce costs and slash prescription drug prices, the “Gillibrand Prescription for Lower Drug Prices.”
Experts say that reining prescription drug costs may be Congress’s best shot at fighting inflation. According to AARP, if consumer prices rose as much as prescription drug prices over the years, a gallon of gas would cost more than $12 today. Prescription drug prices have risen faster than inflation for the past several decades.
Joined by Beth Shapiro, Executive Director of Citymeals on Wheels, Sen. Gillibrand outlined the tenets of the bill package, which would help tackle the high cost of prescription drugs.
“With inflation high and while our nation is recovering from the pandemic, drug prices remain unacceptably high, which puts a heavy financial burden on older adults and families throughout New York City and across the country,” said Senator Gillibrand a member of the Aging Committee. “I am releasing the ‘Gillibrand Prescription for Lower Drug Prices’ plan to provide a framework for slashing drug prices, which would provide much-needed relief as inflation continues to raise the cost of living for average New Yorkers. From fighting price gouging to importing affordable drugs from Canada to enabling Medicare to negotiate drug prices, this plan will help us bring down costs for countless Americans.”
“Citymeals on Wheels nourishes 20,000 of New York City’s oldest residents. They worked and contributed to their communities for decades, but many enter their 80s and 90s living well below the poverty level,” said Beth Shapiro, Executive Director of Citymeals on Wheels. “Our recipients are often forced to pay rent and afford medication. We know they sometimes split their meals and pills to make them last longer. Lowering the cost of prescription drugs will immediately impact the quality of their lives, and the lives of millions across the country, when they are most in need.”
The core pieces of the “Gillibrand Prescription for Lower Drug Prices” are:
· Reimagine financial assistance for Medicare. The legislation created the Medicare Cost Assistance Program, a new, streamlined program to provide service with Medicare Part A and Part B premiums and cost-sharing for low-income individuals. This would reimagine financial assistance for Medicare Part A, Part B, and Part D. The legislation would also expand and streamline the administration of the Extra Help program to provide premium and cost-sharing assistance to eligible low-income individuals with Medicare Part D.
· Review brand-name price gouging. The legislation would level the market for Americans purchasing prescription drugs by pegging the United States to the median price in Canada, the United Kingdom, France, Germany, and Japan.
· Empower Medicare to negotiate drug prices. A bill directs the Secretary of Health and Human Services to negotiate lower prices for prescription drugs under Medicare Part D.
· import lower-cost drugs from Canada. The legislation allows patients, pharmacists, and wholesalers to import safe, affordable medicine from Canada and other major countries.
· Expand subsidies to seniors living in U.S. territories. The legislation would make Medicare beneficiaries in U.S. territories, such as Puerto Rico, eligible for the Medicare Part D Low Income Subsidy program. Under current law, low-income Medicare beneficiaries in Puerto Rico and other U.S. territories are ineligible for Medicare Part D subsidies. This program, known as “Extra Help,” provides federal grants to help low-income seniors with their monthly premiums and other out-of-pocket prescription drug costs.
Under current law, the secretary of HHS is prohibited from negotiating lower drug prices on behalf of Medicare Part D beneficiaries. In contrast, other government programs, like Medicaid and the Department of Veterans Affairs (VA), are allowed to negotiate. According to a recent report by the Government Accountability Office, Medicare paid twice as much for the same prescription drugs as the VA in 2017.
In 2020, five of the largest pharmaceutical companies in the U.S. made nearly $45 billion in profits. That same year, amid a twin public health and economic crisis, drugmakers raised the prices of more than 860 prescription drugs by 5%, on average. In 2020, the average annual cost of therapy for widely-used specialty drugs was more than $84,000. This is nearly three times the median income for people on Medicare and more than four and half times the average Social Security retirement benefit.
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