Perspective               

Rx Benefit Still Not Added To Medicare

In June, the U.S. House of Representatives passed a prescription drug bill, which was widely criticized by consumer advocates because it relied exclusively on private insurance companies to provide a prescription drug benefit to older and disabled men and women with Medicare. And the U.S. Senate recently left for its August recess without passing any Medicare prescription drug bill. The result is that millions of older and disabled men and women still have no or inadequate prescription drug coverage.

This fall, Congress should pass a bill that offers a drug benefit through the Medicare program:

• The legislation should have guaranteed benefits and predictable and affordable costs.
• The drug coverage offered should be comprehensive.
• There should be no gaps in coverage.
• The out-of-pocket costs should be capped at a reasonable amount ($2,000-$3,300).
• People with low-incomes should get subsidies to cover premiums, deductibles, and co-insurance.

The bill that was passed in the House in June would not provide a real Medicare prescription drug benefit to older and disabled men and women because:

• Rather than guarantee good, affordable prescription coverage through the Medicare program, it only affords people with Medicare the option to buy a private prescription drug insurance policy similar to a Medicare supplemental insurance policy, or Medigap. (Only 8 percent of people with Medicare choose to buy Medigap plans that offer drug coverage.)
• Insurance companies have made it very clear that they are unable to offer affordable prescription drug policies to older and disabled people who will file a lot of claims.
• Private insurers lack the purchasing leverage available to the federal government through Medicare to keep the costs of drugs down. If a benefit is available only through private insurance companies, experience shows that premiums and drug prices are likely to increase every year.
• It does not guarantee people continuity of prescription coverage. There is every reason to believe that private insurers will behave like Medicare HMOs and drop policy holders from one year to the next.

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