Potential Impacts of the Medicare Drug Discount Card

The White House recently announced a plan to send $200 discount cards to 39 million Medicare members. Politico has obtained a draft copy of the proposal, which CMS expects to begin rolling out as soon as next week. There is considerable doubt as to the legal authority to implement the plan. Separately, a New York Times report details failed efforts between the White House and pharmaceutical manufacturers to negotiate a deal that would have produced similar results, indicating that even if this plan fails, a similar solution may emerge in the future.  

The $200 discount cards can be used instead of any qualified, out-of-pocket cost-sharing for Part D covered drugs. CMS will later evaluate the downstream impacts of this demonstration. In this white paper we review the potential implications for health plans assuming these discount cards are approved.