Obama administration ditches Medicare drug benefit proposal

The Obama administration said on Monday that they would abandon the proposed changes to Medicare drug coverage because people worried that it would harm health benefits for the elderly and disabled.

Last week more than 370 organizations representing insurers, drug makers, pharmacies, health providers and patients urged the Centers for Medicare and Medicaid Services (CMS) to renounce changes it had proposed for Medicare Part D.

The $70 billion Part D program provides drug benefits for the elderly and disabled through private insurers to 36 million enrollees. But the opposition said that the intended changes would undermine these benefits, and would negatively impact the Medicare Advantage program, which allows Medicare beneficiaries to get their major medical coverage through private insurers.

Critics seemed to have forced the administration's hand.

"Given the complexities of these issues and stakeholder input, we do not plan to finalize these proposals at this time. We will engage in further stakeholder input before advancing some or all of the changes in these areas in future years," CMS Administrator Marilyn Tavenner advised in a letter, according to Reuters, sent on Monday to members of the Senate and House of Representatives.

These new rules sought to end the requirement that insurers offer drug coverage for all antidepressants and immunosuppressants. It would also increase the number of pharmacies covered by health plans while limiting the choice of Medicare Part D policies available.

Thus, pharmacies are not happy and are getting the short end of the stick with this recall.

"We are deeply disappointed in CMS' decision not to move forward at this time with the pharmacy choice provision," said B. Douglas Hoey, chief executive officer of the National Community Pharmacists Association.

But for all those opposed it is a win.

"We applaud CMS administrator Tavenner for the agency's sound judgment on this issue," said Mary Grealy, president of the Healthcare Leadership Council, a coalition member that represents chief executives from the healthcare industry.