US Medicare drug costs drop significantly says HHS and CNS chiefs

The USA's Medicare's new drug coverage will have significantly lower premiums and lower costs to federal taxpayers and states, as a result of stronger-than-expected competition in the prescription drug market and lower drug costs, stated Centers for Medicare and Medicaid Services (CMS) Administrator Mark McClellan.

Beneficiary premiums are now expected to average $25 a month - down from the $37 projected in last July's budget estimates - and the overall cost to taxpayers for 2006 will drop 20% over the July 2005 estimate, according to the CMS Office of the Actuary. The savings result from lower expected costs per beneficiary; projected enrollment in the drug benefit has not changed significantly.

"Our report shows that the cost of the program will be about 20 percent less in 2006," said Health and Human Services Secretary Mike Leavitt, adding: "costs are going down even as enrollment is going up. This is good news for seniors, taxpayers and the Medicare program."