October 25, 2014
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Closing 'donut hole' saved Kent County residents $1.6M, says Langevin

Congressman Jim Langevin announced last week findings from a report issued by the U.S. Department of Health and Human Services (HHS), which determined that 2,873 seniors in Kent County saved more than $1.6 million on prescription drug costs in 2011 as a result of provisions he helped pass in the Affordable Care Act. Benefits are anticipated to increase in the coming years.

This fiscal relief from health care expenses comes from closing the “donut hole,” which had forced seniors in Medicare’s prescription drug plan to lose their benefits during a specified gap in their coverage. Since the new law’s enactment, seniors in the donut hole have received assistance during this period, with the gap to close completely by 2020.

“We owe it to our seniors, who have paid into Medicare over their lifetimes, to ensure they receive the affordable and accessible health care they deserve,” said Langevin in a press release. “That means getting rid of the prescription drug donut hole and focusing on other improvements, such as offering free preventive services and wellness visits. Through the Affordable Care Act, we addressed some of the inefficiencies in Medicare to save $500 billion, while providing real savings for beneficiaries where it matters most, as evidenced by this report.”

Last year, the Affordable Care Act provided a seven percent discount on covered generic medications for people who hit the prescription drug coverage gap known as the donut hole, with 2,814,646 beneficiaries nationwide receiving $32.1 million in savings on generics. Furthermore, the law provides a 50 percent discount on brand-name prescription drugs and, this year, a 14 percent discount on generics.

In an e-mail interview, Langevin said, he is pleased by the progress that has been made in lowering health care costs for seniors.

“The report shows they will experience more savings in the future, but we still have work to do to ensure every senior has access to affordable coverage,” he said. “The next step must involve addressing the flawed Medicare physician reimbursement formula that constantly threatens to reduce payments to doctors who treat Medicare patients, making it harder for them to meet our seniors’ needs. The cuts will go into effect at the end of the month unless Congress acts. We must include this as part of the middle-class tax cut discussions and seek a permanent solution to this problem.”

In 2011, the 3.6 million Americans who hit the donut hole saved $2.1 billion on the cost of their prescription drugs. Throughout Rhode Island, 14,822 beneficiaries received $8.2 million in savings for an average of $554.41 per person. Overall, HHS estimates that the average person with Medicare will save nearly $4,200 by 2021 from closing the donut hole and other provisions in the law, including free preventive services, like mammograms, for everyone in Medicare; reduction of growth in Part B premiums paid for physician services; reduction in cost-sharing required from seniors in both Part A and Part B.


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