Perspective
Prescription Drug Coverage in the Medicare Overhaul Bill
You may have heard about a Medicare prescription drug card that will become available to people with Medicare in the spring of 2004. You may not know that you could save more on your prescriptions through the drug discounts you already get from other cards and discount programs.
The Medicare discount card will have flexible features and cover different drugs, which may make it difficult for you to know if there is a card that you should sign up for.
The drug cards will cost no more than $30 and will be free to individuals with incomes under $12,123. With a card, you are projected to save between 10 and 15 percent off retail pharmacy prices on some medicines.
The prescription drug card is likely to make the most sense for people with low incomes. If your annual income is below $12,123 ($16,362 for a couple), the government will pay your fee for the discount card and 90 to 95 percent of the cost of covered drugs up to $600 a year. You will have to pay the other 5 to 10 percent and the full cost of any drugs above the $600. The prescription drug cards will compete for business against other discount programs and with Internet pharmacies in the United States and abroad.
The Part D prescription drug benefit, which will go into effect in January 2006, will also benefit low-income individuals the most. Once the full Medicare drug benefit goes into effect, low-income individuals whose incomes are too high to qualify for Medicaid will pay no premiums or deductibles for the benefit and will be able to buy drugs for between $2 and $5 a prescription. But asset tests will apply to these seniors who do not qualify for Medicaid, possibly excluding them from these benefits. People who qualify for Medicaid will lose their Medicaid drug coverage but will receive good coverage through Medicare, paying no premiums, deductibles, or coinsurance, and only between $1 and $3 for each prescription.
You will get Medicare drug coverage through a private company. It is still not clear which companies will offer this benefit.
Experts and advocates continue to debate how much either the discount card or the Medicare drug benefit will help people.
For other ways to help pay for your prescription drugs, go to Prescription Drug Assistance Programs.