Drug Companies To Cut Drug Costs For Seniors, Aid Obama’s Health Care Reform Plan

President Barack Obama announced an agreement between the administration and pharmaceutical companies Monday to lower the cost of medication for Medicare recipients.

The agreement seeks to eliminate the so-called “doughnut hole”, in which Medicare only covers prescription drug costs up to $2,700 annually and again when drug costs exceed $6,154 a year, but not the costs landing between the two benchmarks.

Through the agreement, pharmaceutical companies will provide $80 billion to lower the costs of medication for Medicare recipients over the next ten years.

“Drug and insurance companies stand to benefit when tens of millions more Americans have coverage. So we’re asking them, in exchange, to make essential concessions to reform the system and help reform costs,” said Obama. “It’s only fair.”