President Donald Trump is proposing to lower prescription drug costs for Medicare beneficiaries by allowing them to share in rebates that drug companies pay to insurers and other middlemen.
A senior administration official outlined the plan on condition of anonymity Thursday 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.
Insurers apply savings from rebates to keep premiums more manageable.
Under Trump's proposal, seniors covered by Medicare's "Part D" prescription benefit would be able to share in the rebates for individual drugs that they purchase at the pharmacy.
The plan also expands Medicare's "catastrophic" drug benefit so many seniors with very high costs would not face copayments.
The congressional budget deal would shift a bigger share of Medicare's medication costs to drug companies, a change that could help limit future increases in beneficiaries' premiums for prescription coverage.
Changes to Medicare's popular "Part D" prescription plan headline a long list of budget-deal tweaks to the government's premier health insurance program, which covers about 60 million seniors and disabled people.
Also, the drug coverage gap known as the "doughnut hole" would be eliminated one year earlier than currently scheduled, in 2019 instead of 2020.
Another provision would raise premiums paid by the wealthiest retirees for coverage of outpatient services and prescription drugs.
And the deal would permanently repeal current limits on outpatient rehab services, such as physical and occupational therapy. Previously, Congress had routinely waived the therapy caps