Trump proposes reduction of drug costs under Medicare

WASHINGTON (AP) – President Donald Trump will propose lowering prescription drug costs for Medicare beneficiaries by allowing them to share in rebates that drug companies pay to insurers and middlemen.

A senior administration official outlined the plan Thursday on condition of anonymity ahead of the release of Trump’s 2019 budget plan next week.

Pharmaceutical companies now pay rebates to insurers and pharmacy benefit managers to help their medications gain a bigger slice of the market.

President Donald Trump speaks during the National Prayer Breakfast, Thursday, Feb. 8, 2018, in Washington. (AP Photo/Evan Vucci)

Insurers apply savings from rebates to keep premiums more manageable.

Under Trump’s proposal, seniors covered by Medicare’s popular “Part D” prescription benefit would be able to share in the rebates for individual drugs that they purchase at the pharmacy.

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