WASHINGTON (AP) — Budget experts for Congress say the Trump administration’s plan to reduce out-of-pocket drug costs for Medicare beneficiaries will cost taxpayers another $177 billion from 2020-2029.
The nonpartisan Congressional Budget Office analysis released on Thursday could affect prospects for one of the administration’s centerpiece proposals to lower drug costs.
Under the plan, drugmaker rebates now paid to insurance companies and their middlemen would instead go directly to seniors in Medicare’s Part D program when they fill prescriptions.
While that would reduce copays for many beneficiaries, CBO projected it would increase taxpayer-subsidized premiums, adding $170 billion to program costs. Medicaid spending would increase by $7 billion.
CBO concluded that drug companies are unlikely to lower list prices in response to the plan.
There was no immediate reaction from the administration.