Seniors are Saving Money Today and Tomorrow, Thanks to Health Care Law

By Kathleen Sebelius, Secretary of Health and Human Services
Posted February 02, 2012

Like thousands of Americans, Vero Beach, Florida resident William Morris is suffering from a rare, but treatable cancer. Compounding that difficult diagnosis is further bad news that, like many cancer drugs, the medicine he so desperately needs is very expensive.

But help with this cost came for William and his wife Suzanne from newly enhanced benefits under Medicare Part D – made possible by the health care reform law, the Affordable Care Act.  Thanks to the law, William saved $2,000 on the cost of his chemotherapy drugs.

Suzanne and William Morris are not alone. For years, seniors have watched their health care bills go up. The Affordable Care Act helps folks like the Morris family, and other seniors, by closing the gap in prescription drug benefits known as the “donut hole.” To assist those in the coverage gap, the law adds increased help for seniors and people with disabilities over time until the donut hole closes in 2020.   William and Suzanne benefited from that help when they received big discounts on the medicine they needed.  People in the coverage gap also receive a 50% discount on expensive brand-name drugs covered by Part D and a 7% discount on generic medicines.

Today, we announced that in 2011 about 3.6 million people with Medicare benefited from donut hole discounts—saving a total of $2.1 billion, or an average of $604 per person.

And a new report released today finds that these discounts and other parts of the Affordable Care Act will lead to even bigger savings in the years ahead. According to the report, the average person with Medicare will save approximately $4,200 from 2011 to 2021, while those with high prescription drug costs will save much more – as much as $16,000 over the same period.  This is especially good news for people with chronic conditions such a diabetes and high blood pressure who must take their medication every day for many years.

For older Americans and people on disabilities who live on fixed incomes the value of this help cannot be overstated. Evidence indicates that as many as 25 percent of people with Medicare Part D stop taking their medicine when they are in the coverage gap. Thanks to the Affordable Care Act, they won’t have to.

For people like William who are fighting life-threatening or debilitating diseases, this benefit can help them heal, improve the quality of their lives and prevent the sometimes devastating results of leaving chronic conditions untreated.