Congress Puts Off Action on Prescription Drug Benefit

Send this article to a friend.

Printer friendly version.

Congress Puts Off Action on Prescription Drug Benefit

Congress has postponed action on adding a prescription drug benefit to Medicare until 2002. Even before the attack on America, the August 2001 economic report from Congressional Budget Office (CBO) indicated that funding for a Medicare prescription drug benefit was far less than the $300 billion (over 10 years) allocated in the spring budget resolution. Prior to the attack, President Bush proposed $190 billion between 2004 and 2011 for Medicare reforms that include a prescription drug benefit. He threatened to veto any spending proposals that exceeded budget guidelines.

According to a story that appeared in the July 22, 2001 issue of The New York Times, lawmakers and health policy experts say even with a $300 billion budget the most generous benefits now under consideration will fall far short of what many seniors expect. The main Democratic plan, sponsored by Senator Bob Graham (D-FL) was originally estimated to cost beneficiaries $53 per month in premiums, have a $250 deductible, and would cover half the cost of each prescription until out-of-pocket costs reached $3,500.

A survey conducted in the February issue of The Social Security & Medicare Advisor however, found that almost 40% of those responding said that they couldn't afford an additional monthly premium of $30-$35 even with no deductible and full catastrophic coverage once expenses exceed $4,000. That was even if Medicare covered all premium and drug costs for those with incomes under $11,300 for individuals and $15,200 for couples.

Sources: "White House Excludes Medicare Drug Funding Additions From Budget Update," Health New Daily, August 23, 2001. "Even Most Generous Drug Plan May Be Disappointing to Elderly," Robert Pear and Robin Toner, The New York Times, July 22, 2001.

To read a related story entitled "Will Seniors Pay the Price?" from the September 2001 issue of The Social Security & Medicare Advisor click here: http://www.tscl.org/newContent/101157.asp

November 2001

This article first appeared in Volume 6, Issue 11 of `The Social Security and Medicare Advisor` newsletter (November/December 2001). To receive future editions of `The Advisor` in its special, free e-mail version, please click here.