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July 27, 2005

Comparison of Drug Regimen Costs Between the Medicare Prescription Discount Program and Other Purchasing Systems

Author Affiliations

Letters Section Editor: Robert M. Golub, MD, Senior Editor.

JAMA. 2005;294(4):425-428. doi:10.1001/jama.294.4.427-b

To the Editor: Commentators have suggested that the new Medicare Prescription Drug Improvement and Modernization Act would cost substantially less if the federal government were allowed to directly negotiate drug prices for patients insured under Medicare.1 In contrast, the Congressional Budget Office has concluded that this effect would be negligible and has emphasized substantial savings available through the Medicare associated private plans.2 The Department of Veterans Affairs directly negotiates with pharmaceutical companies for the prices of dispensed prescriptions. We estimated the savings for a hypothetical patient if the Medicare benefit utilized direct negotiation with pharmaceutical companies similar to the approach used by the Department of Veterans Affairs.

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