White House releases budget summary

President Obama released an overview of the administration's FY10 budget proposal on Thursday that includes increasing rebates on Medicaid drugs, raising premiums for Medicare outpatient prescription drug coverage for higher-income beneficiaries, and allowing drug importation. The White House said details of the proposal will be released in April. About half of the $630 billion set aside over 10 years as a "down payment" on healthcare reform would come from healthcare savings. This includes increasing rebates drug companies pay on drugs purchased by Medicaid to 22% from the current 15%, extending rebates to managed care plans, and applying rebates to new formulations of existing drugs, which is estimated to save $19.5 billion over a decade. The proposal envisions savings of $177 billion over 10 years by reducing payments to Medicare Advantage, private managed care plans that provide Medicare services. The White House also wants to save $8.1 billion over 10 years by making higher income individuals pay more for the Medicare Part D outpatient prescription drug benefit. The proposal said FDA will receive funds for its "new efforts to allow Americans to buy safe and effective drugs from other countries," but provides no details. It also said the agency will get a "substantial" increase in funding for medical product safety. The document requests more than $6 billion for NIH research on cancer in FY10, and promises a "sustained, multi-year plan to double cancer research." The NCI's FY08 budget was $4.8 billion. ...