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Trump Administration Drives Down Drug Costs for Seniors

Trump Administration Drives Down Drug Costs for Seniors

Today, the Centers for Medicare & Medicaid Services (CMS), under the leadership of President Trump, announced that, for the third year in a row, the average basic premium for Medicare Part D prescription drug plans, which cover prescription drugs that beneficiaries pick up at a pharmacy, is projected to decline. Over the past three years, average Part D basic premiums have decreased by 13.5 percent, from $34.70 in 2017 to a projected $30 in 2020, saving beneficiaries about $1.9 billion in premium costs over that time. As a result, Part D continues to be an extremely popular program, with enrollment increasing 12.2 percent since 2017.

In addition to the premium savings for beneficiaries realized as a result of the increased competition and strengthened negotiations in Part D, the continued decline in Part D bid amounts over the past three years is estimated to save taxpayers nearly $6 billion in the form of lower Medicare premium subsidies.

“President Trump has listened to what American patients and seniors want, and he has promised to protect what works and fix what’s broken in American healthcare,” said HHS Secretary Alex Azar. “Medicare Part D plans continue to be extremely popular, and the President is delivering improvements to Part D, offering plans more ways to provide low-cost options and delivering patients more transparency on drug prices. With premiums in Part D now projected to decline for 2020, President Trump is delivering on his promise to protect seniors and put patients in control.”

“Under President Trump’s leadership, CMS has been taking action to lower the cost of prescription drugs, and we are seeing the results of our actions” said CMS Administrator Seema Verma. “At a time when healthcare costs are going up, the Trump Administration is delivering lower costs to seniors. Part D plans are having to prove their value to beneficiaries – the actions that CMS has taken to strengthen the Medicare prescription drug program are working to drive down costs for seniors.”

In Medicare Part D, beneficiaries choose the prescription drug plan that best meets their needs, and plans have to improve quality and lower costs to attract beneficiaries. This competitive dynamic sets up clear incentives that drive towards value. CMS has taken steps to modernize the Part D program by providing beneficiaries the opportunity to choose among plans with greater negotiating tools that have been developed in the private market and by providing patients with more transparency on drug prices. Increasing competition and strengthening negotiations are key pillars of President Trump’s Blueprint to reduce prescription drug prices, and CMS will continue to implement the President’s Blueprint to ensure that American seniors can access the prescription drugs they need at an affordable price.

Improvements to the Medicare Part D program that CMS has made to date include:

  • Providing more information on out-of-pocket costs for prescription drugs to beneficiaries by requiring Part D plans to adopt tools that provide clinicians with information that they can discuss with patients on out-of-pocket drug costs at the time a prescription is written.
  • Implementing Part D legislation signed by President Trump to prohibit “gag clauses,” which keep pharmacists from telling patients about lower-cost ways to obtain prescription drugs.
  • Requiring the Explanation of Benefits document that Part D beneficiaries receive each month to include information on drug price increases and lower-cost therapeutic alternatives.
  • Providing beneficiaries with more drug choices and empowering beneficiaries to select a plan that meets their needs by allowing plans to cover different prescription drugs for different indications, an approach used in the private sector.
  • Reducing the maximum amount that low-income beneficiaries pay for certain innovative medicines known as “biosimilars,” which will lower the cost of these innovative medicines for these beneficiaries.   
  • Allowing certain generic drugs to be substituted onto plan formularies more quickly during the year, so beneficiaries immediately have lower cost sharing for these drugs.
  • Increasing competition among plans by removing the requirement that certain Part D plans have to “meaningfully differ” from each other, making more plan options available for beneficiaries.

The upcoming annual Medicare Open Enrollment period for 2020 begins on October 15, 2019, and ends on December 7, 2019. During this time, Medicare beneficiaries can choose health and drug plans for 2020 by comparing their current coverage and plan quality ratings to other plan offerings, or they can choose to remain in traditional Medicare. For the first time in ten years, the agency is redesigning Medicare Plan Finder, the website for Medicare plan selection, so beneficiaries will be able to more easily compare options and choose the plan that best meets their needs. CMS anticipates releasing the premiums and costs for specific Medicare health and drug plans for the 2020 calendar year in mid-to-late September.

To view the 2020 Part D base beneficiary premium, the Part D national average monthly bid amount, the Part D regional low-income premium subsidy amounts, the de minimis amount, the Medicare Advantage employer group waiver plan regional payment rates, and the Medicare Advantage regional PPO benchmarks, visit: and select “2020.”


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