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Drugmakers to improve benefits

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The Associated Press

The Tampa Tribune

Published: June 21, 2009

WASHINGTON - The pharmaceutical industry agreed Saturday to spend $80 billion over the next decade improving drug benefits for seniors on Medicare and defraying the cost of President Barack Obama's health care legislation, capping secretive negotiations involving key lawmakers and the White House.

"This new coverage means affordable prices on prescription drugs when Medicare benefits don't cover the cost of prescriptions," said Sen. Max Baucus, chairman of the Senate Finance Committee.

The deal marked a major triumph for Baucus as well as the administration. Obama praised the deal.

Baucus' announcement said drug companies would pay half of the cost of brand-name drugs for seniors in the so-called doughnut hole - a gap in coverage that is a feature of many of the plans providing prescription coverage under Medicare. Other officials said wealthier Medicare beneficiaries would not receive the same break.

In addition, the entire cost of the drug would count toward a patient's out-of-pocket costs, meaning their insurance coverage would cover more of their expenses.

At a minimum, the agreement served as an effective counter to the impression that the drive to enact health care legislation was sputtering.

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