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NCOA Low-Income Improvements Included in House Committees’ Medicare Part D Legislation

This week, two House committees passed legislation that includes NCOA proposals to make prescription drugs more affordable, particularly for low-income Medicare beneficiaries and those with high out-of-pocket costs.

Since 2007, NCOA has led advocacy efforts to protect and improve the Medicare Part D Low-Income Subsidy (LIS or Extra Help). LIS makes Part D affordable for low-income beneficiaries by helping pay for their prescription drug premiums, deductibles, and copays.

The House Ways and Means Committee, chaired by Rep. Richard Neal (D-MA), and the House Energy and Commerce Committee, chaired by Rep. Frank Pallone (D-NJ), passed legislation that includes eight provisions to improve the LIS program, six of which are included in the Medicare Part D recommendations NCOA sent to Congress earlier this year.

The Title IV of the Lower Drug Costs Now Act (H.R. 3) (pages 119-134) would:

  1. Eliminate copayments for generic drugs for LIS beneficiaries. This provision is based on H.R. 2757, introduced by Reps. Joe Cunningham (D-SC), Gus Bilirakis (R-FL), and Dwight Evans (D-PA).
  2. Better educate LIS-eligible beneficiaries by requiring the Centers for Medicare and Medicaid Services (CMS) to send them a notice that compares Part D plan out-of-pocket costs and provides information on opportunities to enroll in zero premium benchmark plans. This is based on H.R. 4632, introduced by Reps. Ron Kind (D-WI), Sharice Davids (D-KS), and G.K. Butterfield (D-NC).
  3. Improve the LIS assignment process by replacing the current random assignment of LIS beneficiaries whose zero premium benchmark plans are no longer available with an “intelligent assignment” process prioritizing plans with better coverage and lower costs.
  4. Allow more people to qualify by expanding the income eligibility thresholds for partial LIS benefits from 150% to 200% of the Federal Poverty Level (FPL) and expanding the thresholds for full LIS benefits from 135% to 150% of FPL. This provision is based on H.R. 4620, introduced by Reps. Max Rose (D-NY), Marc Veasey (D-TX), and Joseph Morelle (D-NY).
  5. Extend eligibility to low-income residents of Puerto Rico and other U.S. Territories, who are not currently able to receive this vital assistance.
  6. Provide for automatic LIS enrollment by requiring it for all adults who reach age 65 with incomes below 200% of FPL and who were enrolled in Medicaid. This provision is based on H.R. 4661, introduced by Reps. Chris Pappas (D-NH) and Paul Tonko (D-NY).
  7. Expand eligibility by eliminating burdensome LIS eligibility asset requirements and streamlining the enrollment process. This provision is based on H.R. 4628, introduced by Reps. Mary Gay Scanlon (D-PA), Peter Welch (D-VT), and Brendon Boyle (D-PA).
  8. Exclude certain retirement accounts from the calculation of assets in determining eligibility. This provision is based on H.R. 4655, introduced by Reps. Susie Lee (D-NV), Antonio Delgado (D-NY), and Yvette Clarke (D-NY).

H.R. 3 also includes three other titles with significant Part D reforms:

  • Title I requires manufacturers of specific prescription drugs to negotiate with the Secretary of Health and Human Services for the prices of those drugs or face an excise tax on their sales.
  • Title II establishes a mandatory rebate for drug manufacturers of certain covered Part B and Part D drugs that increase in price faster than inflation.
  • Title III includes a $2,000 hard cap on beneficiaries’ prescription drug out-of-pocket costs. The House proposal provides significantly better protection than under the bill passed by the Senate Finance Committee, which included a $3,100 cap. Title III also would change the structure of the standard benefit design for Medicare Part D.

During committee markup, several other Medicare bills were considered and passed:

  • Three bills (H.R. 4618, H.R. 4650, and H.R. 4665) would add dental, hearing, and vision benefits to Medicare Part B, respectively.
  • The Energy and Commerce Committee passed H.R. 4671, the Help Seniors Afford Health Care Act, which includes reforms NCOA has long advocated for that would significantly improve access to the three low-income assistance Medicare Savings Programs (MSPs) – the Qualified Medicare Beneficiary (QMB) program, the Specified Low-Income Beneficiary (SLMB) program, and the Qualified Individual (QI) program. NCOA is grateful to Reps. Andy Kim (D-NJ), Lisa Blunt Rochester (D-DE), and Dwight Evans (D-PA) for their leadership in introducing this bill.

Next Steps

Although House floor action is possible next week, some think November is a more likely timeframe. H.R. 3 passed without Republican support. Titles I and II are particularly controversial and are likely to struggle to receive the Republican support needed for Senate passage. Expanding Medicare dental, hearing, and vision coverage, while laudable and generally supported by NCOA, would be quite expensive and also could have difficulty getting bipartisan support.

In the Senate, the Finance Committee passed S. 2543, the Prescription Drug Pricing Reduction Act with some bipartisan support. The bill includes a provision similar to Title II of H.R. 3, but Senate floor action has been held up largely due to the controversial nature of this inflation rebate section. Unfortunately, the Finance Committee failed to include any of the eight LIS improvements that are in the House bill.

The path forward on these efforts to make prescription drugs more affordable will not be easy. Many still hope that a drug bill can be enacted into law before the December holidays as part of a large omnibus package that includes budget appropriations bills. However, the controversies outlined above and the serious tension between House Democrats and President Trump over potential impeachment proceedings make things difficult to predict.

If your Representative is listed above as advocating on behalf of low-income Medicare beneficiaries in crafting H.R. 3, please thank them for their leadership and urge them to continue working to ensure these provisions are included in whatever final prescription drug bill emerges.

NCOA will continue to work with national, state, and local partners to pass bipartisan legislation that reduces the cost of prescription drugs for Medicare beneficiaries in greatest need of help.

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Howard Bedlin

About Howard Bedlin

Howard Bedlin is NCOA's Vice President of Public Policy and Advocacy. He is responsible for all of NCOA’s federal and state legislative advocacy efforts on issues and programs of concern to older adults, which include the Older Americans Act, Medicare, Medicaid, long-term care, income security, and community services programs.