Millions of Seniors Saving Money on Prescription Drugs, Thanks to the Affordable Care Act

By Nancy-Ann DeParle. Crosspost from The White House Blog

Over the weekend, a report by the Associated Press detailed how the Affordable Care Act is dramatically reducing drug costs for seniors who hit the prescription drug coverage gap known as the donut hole. This year, seniors are benefiting from a 50 percent discount on brand-name drugs in the donut hole. And the discount and other provisions in the law are saving money for seniors. As the AP reported:

The average beneficiary who falls into the coverage gap would have spent $1,504 this year on prescriptions. But thanks to discounts and other provisions in President Barack Obama’s health care overhaul law, that cost fell to $901, according to Medicare’s Office of the Actuary, which handles economic estimates.

So far this year, more than 2.2 million people with Medicare have saved more than $1.2 billion on their prescriptions. The Associated Press spoke with two of them:

For retired elementary school teacher Carolyn Friedman, it meant she didn’t need a loan to pay for drugs that keep her epilepsy under control.

“What a change for the better,” said Friedman, 71, of Sunrise, Fla. “This year it was easier to pay my bills, whereas last year I had to borrow money to pay for my medications when I was in the doughnut hole.”

Joan Gibbs thought her pharmacy had made a mistake. Her total cost for a brand-name painkiller in the doughnut hole came out lower than her co-payment earlier in the year, at a time her plan was picking up most of the tab.

“I reluctantly called the insurance company,” said Gibbs, 54, who lives near Cleveland. “If they had made a mistake, I knew they would catch it sooner or later. I was very surprised that it turned out to be such a good discount.”

Gibbs is on Medicare because of an auto-immune disorder and other medical problems that left her unable to work.

Thanks to the Affordable Care Act, seniors will receive bigger discounts in the years ahead. By 2020, the donut hole will be closed completely.

And even if you don’t hit the donut hole, there’s still good news for beneficiaries with Medicare Part D. Prescription drug premiums will not rise next year, and thanks to health reform, seniors can get preventive services like mammograms and other cancer screenings for free.

Nancy-Ann DeParle is the Assistant to the President and Deputy Chief of Staff

We Can’t Wait: Jumpstarting Innovation in Health Care, Reducing Costs

By Donald M. Berwick M.D., Administrator, Centers for Medicare & Medicaid Services. Crosspost from

Health care costs remain a significant drain on the budgets of families, businesses, and federal and state governments. The health reform law, the Affordable Care Act, made significant strides in making Medicare more affordable and insurance companies more accountable. Congress is considering other ways to build on this progress, but we can’t wait to do more to help make our health care system more affordable.

In that spirit, the Obama Administration recently launched the Health Care Innovation Challenge. Made possible by the Affordable Care Act, this initiative will invest up to $1 billion in the best projects that doctors, hospitals, and other innovators propose to deliver high-quality medical care and save money. Projects that win this competition will use health care dollars more wisely, help create jobs, and help professionals improve the work they do for patients.

Innovation doesn’t happen in a vacuum and usually doesn’t start in Washington — we need the vision and experience of people who are already proving that our health care providers can and do provide better care and better health at lower cost. So we want to hear from you. Send us your innovative ideas and solutions, and submit a proposal outlining your vision for helping us transform the health care system. We’ll sort through these proposals and help put the best ones into practice.

If your proposal has strong evidence that it can start quickly, reduce costs, and improve health care, you can qualify for approximately $1 million to $30 million in an up-front investment. Priority is given to proposals that retrain workers and support job creation. You can find a fact sheet and the Funding Opportunity Announcement on our Healthcare Innovation Challenge Web page.

We’ll work with a wide variety of public and private organizations, including providers, payers, local governments, community and faith-based organizations, and other innovators whose compelling ideas can improve health care for patients. We are also looking for projects that help patients with the greatest health care needs, projects that can be up and running soon, and projects that rapidly hire, train and deploy health care workers.

For example, the Health Care Innovation Challenge could support the use of personal and home care aides to help the elderly stay in their homes or expanding the use of community-based paramedics to provide basic services to individuals in rural communities.

Different communities have different needs and circumstances—some require unique, locally driven innovations. With the Health Care Innovation Challenge, we hope to give providers even more opportunities to make our health care system even stronger.

We look forward to hearing your ideas on how to make this happen. For more information, you can also visit