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Today the U.S. House of Representatives passed H.R. 3, The Elijah Cummings Lower Drug Costs Now Act, by a vote of 230 to 192. This bill, if enacted into law, would lead to a significant reduction in prescription drug costs. The resulting savings would be reinvested into a critical expansion of Medicare benefits (vision, hearing, dental), low-income protections, and Medigap rights expansion. The Center for Medicare Advocacy strongly supports passage of HR 3.

This is the first time that either chamber of Congress has passed a bill containing these crucial prescription drug provisions and Medicare expansions, and serves as an important pathway for policy change. At this point in time, however, prospects for H.R. 3 becoming law are uncertain. Senate leadership does not currently appear to be willing to bring the bill for a vote; further, while the president has articulated many of the same goals concerning reductions in prescription drug prices contained in H.R. 3, including Secretarial drug price negotiation, he has already issued a veto threat against this bill.

Below is a short summary of the bill, focusing primarily on the historic Medicare expansion proposals. The text of the bill is available here, along with amendments, a background document from the Speaker’s office and summary by the relevant House committees. Analysis of the bill by the Congressional Budget Office (CBO) is available here.

Prescription Drugs & Part D Protections

The primary focus of the bill is to reduce the high cost of prescription drugs paid by the Medicare program and others. The bill provides the authority and tools for the Secretary of the Department of Health and Human Services (HHS) to negotiate prices for certain drugs without competition. Drug companies that hike drug costs above the rate of inflation can be required to pay a rebate back to the Medicare program. Drug savings would be available to both Medicare and other insurance.

These drug provisions are projected to save $456 billion over 10 years, most of which would be reinvested into strengthening the Medicare program.

Among the consumer protections added by the bill are a $2,000 annual out-of-pocket limit on Part D prescription drug costs – which currently has no such cap (beneficiaries who enter the catastrophic phase of coverage must still pay 5% of the cost of drugs).

Benefit Expansion

H.R. 3 would reinvest approximately $358 billion in savings achieved through the drug provisions between 2020-2029 into expanding benefits, including $238 billion for dental care, $30 billion for vision care, and $89 billion for hearing services.

Dental

Sec. 601 would be an important step toward providing comprehensive oral health coverage for all Medicare beneficiaries. It is critical to include such coverage in Medicare Part B, as this legislation does. While many of the details of the coverage are left to the discretion of the secretary, there are certain parameters for coverage outlined in the bill. It provides coverage for:

  • Preventive and screening services – specific items listed and frequency: oral exams, dental cleanings – limited to 2 a year – and x-rays, fluoride treatments;
  • Basic treatments – the bill says these may include the following, leaving room for secretarial discretion: basic tooth restorations, basic periodontic services, tooth extractions and oral disease management services – those are covered at 80% starting in 2025;
  • Major treatments – the bill says these may include the following, leaving room for secretarial discretion: major tooth restorations, major periodontic services, bridges, crowns, dental implants, and root canals – covered at 10% starting in 2025 and increasing by 10 percent until 50% coverage in 2029. Coverage is capped at 50% for such services;
  • Dentures – removes the exclusion of dentures in the prosthetic devices definition and includes a full or partial set of dentures no more than once during a 5 year period (starting in 2025) unless the doctor determines they don’t fit the individual; Requires a written order;
  • Items not specifically listed can be included at discretion of secretary, with limits to frequency as determined appropriate.

While we are very pleased that oral health coverage is being considered in Medicare Part B, we have some concerns about the bill not providing fully comprehensive benefits in line with other Part B benefits (namely, the 50% coverage for major treatments). While this is a transformative expansion of dental coverage, we are hopeful that Congress would further expand such coverage through subsequent legislation.

Hearing

Sec. 602 adds new hearing benefits to Medicare Part B and provides hearing aid coverage for individuals with severe or profound hearing loss. Hearing aids are included as covered prosthetic devices starting 2024, and payment may not be made more than once every 5 years (does not include over the counter devices and coverage is pursuant to an order by a physician or qualified audiologist).

The bill would also recognize audiologists as practitioners under Medicare and allow qualified audiologists to provide aural rehabilitation and treatment services

Vision

Sec. 603 adds new vision benefits to Medicare Part B including such vision services as routine eye examinations and contact lens fitting services – this would start in 2024, and 1 routine eye exam and 1 contact lens fitting service would be covered every 2 years. One pair of conventional eyeglasses or supply of contact lenses would be covered every two years starting in 2024 –$85 for lenses and $85 for frames of eyeglasses, or $85 for 2-year supply of contact lenses – with prices indexed annually after 2024.

Medigap Rights

Medicare Supplemental Insurance plans, also known as “Medigaps”, are private health insurance plans that help pay for the “gaps” in coverage in traditional Medicare including copayments, coinsurance, and deductibles. While it is relatively easy for a Medicare beneficiary to enroll in and disenroll from a Medicare Advantage plan on an annual basis, there are limitations regarding when an individual can enroll in a Medigap plan. Under federal law, there are only certain times when companies offering Medigap plans (“issuers”) are required to sell plans to individuals, and  any additional protections vary by state.

Sec. 801 of H.R. 3 makes great strides in reducing the imbalance in enrollment rights between MA plans and Medigaps by expanding federal Medigap protections to create:

  • Open enrollment rights to people under 65 with Medicare;
  • A one-time enrollment opportunity for people with Medicare Parts A and B who otherwise would not qualify for any open enrollment/guarantee issue rights (the period is the first 6 months in 2024); and
  • A one-time ability to pick up a Medigap after disenrolling from a Medicare Advantage (after the current one-year trial period right).

Other

Additional benefits included in the bill are:

  • 805. Waiving Medicare coinsurance for colorectal cancer screening tests – fixes a coverage glitch by which Medicare beneficiaries may be responsible for unexpected high costs when a polyp is removed during a colorectal cancer screening.
  • 806. Medicare coverage of certain lymphedema compression treatment items.

Additional consumer protections/oversight improvements include:

  • 802. Reporting requirements for Medicare Prescription Drug Plan sponsors regarding point-of-sale rejections under Medicare Part D.
  • 803. Providing access to annual Medicare notifications in multiple languages.

Low-Income Protections

Title V of H.R. 3 would make a number of improvements to Medicare programs for lower income individuals, including:

  • Sec. 501. Starting in plan year 2022, information comparing premiums for different plans will be sent to beneficiaries eligible for the Part D low-income subsidy (LIS) every year.
  • Sec. 502. Provides for “intelligent assignment” of certain LIS eligible individuals who are auto-enrolled in plans, which is designed to take into consideration the plans’ use of formulary, prior authorization and other restrictions, and quality of the plan in order to maximize access while minimizing costs to individuals and to the program.
  • Sec. 503. Beginning on January 1, 2024, the full low income subsidy (LIS) eligibility income threshold will be raised from 135% of the Federal Poverty Level (FPL), to 150% of the FPL.
  •  Sec. 507. Beginning on January 1, 2024 the Qualified Medicare Beneficiary (QMB) income threshold will be raised from 100% of the FPL, to 150% of the FPL.

Conclusion

The House’s passage of H.R. 3 is a landmark day in the history of the Medicare program. It serves as a historic blueprint for both bringing down drug costs and expanding benefits for all Medicare beneficiaries. Simply put, it is a “win-win” opportunity. We urge the Senate to take this bill up and the President to sign it into law.

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