The biggest expansion in Medicare's history is underway, and the complicated new drug program is creating huge implementation challenges for Medicare and state Medicaid programs. TSCL is concerned that, in the confusion, some seniors could make costly mistakes, while others may fall through the cracks, resulting in no medications at all.
Low-income Medicare beneficiaries who receive their drug benefits through state Medicaid pharmacy assistance programs should be receiving notification that their Medicaid prescription drug coverage will be ending December 31, 2005. They will start receiving drug benefits automatically under Medicare instead, starting January 1, 2006. These beneficiaries will be assigned to a prescription drug plan at random.
Since coverage will vary between drug plans, however, TSCL is concerned because many of the nation's poorest seniors may discover their new plan does not cover some medications. If this happens they will get stuck for 100% of the cost of their prescription. Although low-income beneficiaries will be able to change drug plans, TSCL is calling on Congress to ensure that seniors who formerly received their drugs through state Medicaid programs do not suffer disruptions in assistance to pay for their prescription drugs.
In October, insurers began marketing the new drug plans. Initial Enrollment in the drug plans begins November 15th and is scheduled to last six months, until May 15, 2006. But according to a recent Kaiser Family Foundation survey, seniors around the nation continue to say that they don't understand how the new coverage will work, or whether it will be worthwhile.
This is a legitimate concern. The Congressional Budget Office has estimated that, excluding premiums, participating seniors will spend an average of $792 for prescription drugs in 2006, or 37% less than the $1,257 costs without the benefit. However, Advisor editor Mary Johnson notes that "once an average monthly premium of $32 and the $250 deductible are included, a Medicare beneficiary could spend $1,426, or 13% more than he or she would without the coverage."
There has also been a nationwide problem of con artists taking advantage of the confusion caused by the program. Quite often callers purport to be "representatives of Medicare drug plans" and ask for personal information like Social Security, bank account and credit card numbers. Medicare rules strictly forbid asking for this information and TSCL is warning seniors NOT to give out any personal information, especially to persons who call on the phone.
TSCL believes that the drug program complexity is unwarranted and unnecessary. The League is working with Members of Congress to replace the 2003 legislation with a simple, traditional Medicare drug benefit.
Sources: "U.S. Retirees Still Wary of Medicare Drug Plan," Susan Heavey, Reuters, August 25, 2005. "Food Stamps and New Medicare Prescription Drug Coverage," CMS, May 25, 2005. "CMS Marketing Rules for Plans Offering Medicare Drug Coverage," CMS, August 15, 2005. "Insurers Await Decision on Drug Plan," The Associated Press, September 7, 2005.
November 2005
