Asclepios
Get Asclepios free by e-mail every week! Click here to subscribe.
Sign Up, Sign On
February 28, 2008 • Volume 8, Issue 9Next year, there will be an even wider hole in the Medicare Part D prescription drug benefit—the part of the year when coverage stops and people with Medicare must pay the full price of drugs even as they continue to pay premiums. This year, the gap, which is measured in out-of-pocket spending, is about $3,216. In 2009, that gap increases to around $3,454.
The gap is growing because the law mandates that the parameters of the benefit—the size of the deductible, the point at which initial coverage ends and the total out-of-pocket spending required before catastrophic coverage kicks in—track annual growth in drug costs per person under Part D. Those costs are rising by nearly 6 percent annually, much faster than the rate of inflation.
Why can’t Medicare restrain the rising costs of prescription drugs instead of simply passing those costs on to consumers?
Answer: The law prohibits Medicare from negotiating lower drug prices.
The insurers tapped to offer Part D coverage—there is no option to receive drug coverage directly from Original Medicare—have been unable to negotiate significant discounts from drug manufacturers. And the discounts they have received have not translated into lower prices for consumers. As a result, people stuck in the Part D coverage gap pay the full price for their medicines. It’s a lousy deal for consumers, but a windfall to drug manufacturers.
The lower prices the government can negotiate with pharmaceutical makers are just one reason people with Medicare deserve the option of receiving drug coverage directly through Original Medicare.
A drug benefit under Original Medicare would provide the simplicity, stability and security that have been absent under the privatized Part D benefit. Plans drop drugs from coverage, add new restrictions to the drugs they do cover, even as they hike premiums and copayments. This year, over one million low-income people with Medicare were randomly assigned a new plan because their old plan was too expensive.
We need to start organizing now so that people with Medicare can get the one choice they really want—a Medicare-run drug benefit. There are two things you can do.
Medical Record
“‘Direct negotiations clearly could save the feds money, the concept being that the government makes almost 50 percent of purchases, and accordingly have almost fiat-like power to set their purchase price wherever they wish,’ says John Ransom, health-care equity analyst at Raymond James & Associates” (“Drug Prices Surge Despite Criticisms On Campaign Trail,” Heather Won Tesoriero, Wall Street Journal, February 21, 2008).
“Although the rebates and other remuneration that Part D plans receive from drug manufacturers are closely held secrets, the evidence is strong that they fall short of the discounts that government health care programs—Medicaid, the VA, health systems in other industrialized countries—have been able to secure, and, therefore, the price concessions a Medicare-administered drug benefit could be expected to achieve” (The Best Medicine: A Drug Coverage Option Under Original Medicare, Medicare Rights Center, October 2007).
“I am a social worker in a Home Health agency and am at my wits’ end to know how to help a patient who has many serious health problems and requires medications that cost her approximately $1,800 per month. She is 58 years old, disabled and on Medicare. She has Medicare Part D and gets 10 percent off some medications through the State Pharmaceutical Assistance Program. However, this help is of minimal use once she reaches the ‘Doughnut Hole’ on Part D. Once in the Doughnut Hole, she is unable to afford her medications and regularly ends up back in the hospital, because she cannot comply with her prescription drug regimen. The last time she was in the hospital, she was in the Intensive Care Unit for three days. Her doctor’s office does help her with free samples and our clinic can help her with some of her insulin. However, this does not solve her overall problem because when she is given free medications, they do not count toward her out-of-pocket spending, and it takes her longer to get out of the doughnut hole. Besides the damage to this patient’s health through not taking needed medications, the cost to society is huge when she is in a continuous revolving door of hospitalization. At the beginning of each year she can afford medications for two months, and then she is facing the rest of the year without proper medications, resulting in more hospital stays” (Story submitted to the Medicare Private Health Plan Monitoring Project, Medicare Rights Center, January 2, 2008).
* * * *
Medicare Part D Appeals Help for Advocates Is Here!
MRC’s new Medicare Part D Appeals: An advocate’s manual to navigating the Medicare private drug plan appeals process offers an easy-to-understand, comprehensive overview of the entire appeals process, including real-life case examples, a glossary of important appeals terms, a sample protocol for advocates, and links to important resources.
Register for a FREE copy of this great resource.
* * * *
Medicare Part D Monitoring Project
The Medicare Rights Center (MRC) would like to hear about your experience, or that of someone you know, enrolled in a Medicare private drug plan. With information about what the issues are with Medicare Part D, we will be able to demand that those problems be fixed.
Submit your story at http://www.medicarerights.org/partdstories.html.
* * * *
The Louder Our Voice, the Stronger Our Message
Asclepios—named for the Greek and Roman god of medicine who, acclaimed for his healing abilities, was at one point the most worshipped god in Greece—is a weekly e-newsletter designed to keep you up-to-date with Medicare program and policy issues, and advance advocacy strategies to address them. Please help build awareness of key Medicare consumer issues by forwarding this action alert to your friends and encouraging them to subscribe today.
* * * *
The Medicare Rights Center (MRC) is the largest independent source of Medicare information and assistance in the United States. Founded in 1989, MRC helps older adults and people with disabilities get high-quality, affordable health care.
Visit our online subscription form to sign up for Asclepios at http://www.medicarerights.org/subscribeframeset.html.