Perspective               

President Clinton's Medicare Reform Plan

On June 29, President Clinton introduced his plan for Medicare reform. The President proposed spending 15% of the federal budget surplus to pay for new benefits and to extend the life of the Medicare trust fund to at least 2027.

The most dramatic change in the President's plan is the addition of a prescription drug benefit. Medicare has never before offered prescription drugs. Today, only half of people on Medicare have some prescription drug coverage. They may get limited prescription drug coverage through Medicare supplemental insurance, or Medigap, which is expensive, or through their former employer. Some people join Medicare HMOs that offer a limited prescription drug benefit. But many people who have drug coverage often pay high out-of-pocket costs for inadequate coverage.

The Medicare Rights Center applauds President Clinton's leadership in helping to ensure access to affordable prescription drugs for the 39 million seniors and people with disabilities on Medicare. The President's plan will help millions of people on Medicare get the medications they need without sacrificing other basic needs. MRC remains concerned, however, that the President's proposal will not adequately protect those people on Medicare with the highest prescription drug costs.

People on Medicare with no prescription drug coverage spend an average of $432 a year out-of-pocket on prescription medications. 4.5 million people on Medicare will spend more than $1,000 in out-of-pocket prescription drug costs in 1999, and 1.3 million will spend more than $2,000. People with illnesses requiring expensive drugs, like Alzheimer's, cancer, and Multiple Sclerosis, often have drug bills that are much higher than average. For example, Multiple Sclerosis medications cost each patient about $11,000 a year.

Many people on Medicare struggle to pay for the prescription drugs they need. Some skip doses or share medications among friends or neighbors. The President's plan will only pay up to $2,500 yearly for each persons' prescription drugs, and it will require people to pay a small monthly premium. This may not help people who spend many thousands of dollars each year on prescription drugs.

If you have trouble paying for your prescription drugs, there are several programs that can help you. For more information on these programs or your Medicare options, call your State Health Insurance Assistance Program, or SHIP. The number is listed in the back of the Medicare & You booklet which was sent to people on Medicare. You can also get a copy by calling 1-800-MEDICARE. Or call your Senator or Congressperson. They should have staff who can help you.

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