The Savings from an Efficient Medicare Drug Plan
Publisher(s): Center for Economic and Policy Research
Author(s): Dean Baker
Keywords: Prescription drugs; Price negotiation; Administrative costs
Coverage: United States
The Medicare Modernization Act (MMA) was passed in 2003 to reform the Medicare system, but the result was an inefficient set of rules and regulations. This report projects savings of $384 billion from 2010 to 2013, or close to $100 billion per year, if Medicare were allowed to negotiate directly with the pharmaceutical industry -- paying the same prices for drugs as countries like Australia -- and the program was administered in a more efficient manner.