Realigning incentives in Medicare Part D (1)

The Congress should make the following changes to the Part D prescription drug benefit:

• Below the out-of-pocket threshold:
  • Eliminate the initial coverage limit.
  • Eliminate the coverage-gap discount program.
• Above the out-of-pocket threshold:
  • Eliminate enrollee cost sharing.
  • Transition Medicare’s reinsurance subsidy from 80 percent to 20 percent.
  • Require pharmaceutical manufacturers to provide a discount equal to no less than 30 percent of the negotiated price for brand drugs, biologics, biosimilars, and high-cost generic drugs.