Archive for Sunday, November 2, 2003

Medicare drug plan wouldn’t help all U.S. seniors

November 2, 2003

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— For older Americans wondering how much help they would get from a Medicare prescription drug benefit, the answer depends on their income and annual pharmacy bills. And, it seems, on who's asked.

President Bush says the proposal being negotiated in Congress would cut those bills in half.

Tom Scully, the top Medicare official, says the legislation would give "a spectacular health benefit" to an older person whose annual income does not exceed $13,500.

John Rother, an analyst for AARP, said enacting the drug benefit would be a "very important social achievement to be able to take care of people at 150 percent of poverty and below."

But some Democrats and other health care analysts say the plan that congressional negotiators tentatively have agreed to offers little to people whose income barely exceeds the limit to receive government subsidies.

"It's a crummy deal, and they're pretty needy, too," said Marilyn Moon, a health care analyst with the American Institutes for Research.

Some critics say that the $400 billion set aside for the plan over 10 years is not enough. Indeed, any bill that emerges from Congress is certain to have a sizable gap in coverage in which Medicare beneficiaries with up to $400 in monthly drug bills would receive little help.

Others make the case that the plan is too generous to people who do not need help paying their bills.

"Having middle-income workers subsidizing drug costs for wealthy seniors ... makes no sense to us and is one of the worst features of this legislation," the conservative National Taxpayers Union said.

Further, there is the argument that 11 million to 13 million older Americans with low annual drug costs would spend more with a Medicare drug benefit. "People are expecting a benefit, but it's not a typical benefit," said Richard Kirsch, executive director of Citizen Action New York.

Participation in the drug plan would be voluntary, but probably would be accompanied by financial penalties for people who sign up after the initial enrollment period.

The drug benefit would come at little cost to the roughly one-third of Medicare beneficiaries whose income is no more than 135 percent of the federal poverty level, $12,123 in 2003.

They would pay only a small share of drug costs --$2 or $5 per prescription.

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