Trump proposes reduction of drug costs under Medicare

President Donald Trump will reportedly propose lowering prescription drug costs for Medicare beneficiaries by allowing them to share in rebates that drug companies pay to insurers. Pharmaceutical companies now pay rebates to insurers and PBMs to help their medications gain a bigger share of the market. Insurers apply savings from rebates to keep premiums more manageable. Under the Trump administration proposal, older adults covered by Medicare's Part D prescription benefit would be able to share in the rebates for individual drugs that they purchase at the pharmacy. Trump's budget would also expand Medicare's catastrophic drug benefit so that many seniors with very high costs would not face copayments. Older adults with high drug bills are currently still responsible for 5% of the cost of their medications. With some new drugs costing $100,000 a year or more, patient costs add up quickly. The proposal would put the White House in the middle of a tug-of-war between drug companies on one side and insurers and PBMs on the other, with billions of dollars at stake.