THURSDAY, Aug. 1, 2002 (HealthDayNews) -- As Senators sling blame over their failure this week to pass a prescription drug bill for seniors, two new studies show how sorely such a package is needed, the study authors say.
The Senate yesterday rejected a pared-down proposal from Democrats, who control the chamber by a margin of one, to provide $390 billion in drug coverage to low-income Medicare recipients and those who struggle to pay their medication bills.
One study, a survey reported in the journal Health Affairs, found that nearly 25 percent of seniors in eight states said they skipped doses or didn't buy medication last year because it cost too much. The review also found that roughly the same percentage of seniors spent at least $100 a month, or $3,600 in 2001, on prescription drugs.
Spending and insurance coverage varied significantly among the eight states -- California, Colorado, Illinois, Michigan, New York, Ohio, Pennsylvania, and Texas. But even in the states with the broadest coverage, about 20 percent of seniors were paying for their medications themselves, the survey found.
It was funded by the Kaiser Family Foundation and the Commonwealth Fund.
Of the nation's 40 million Medicare recipients, 13 million have no supplemental coverage for prescription drugs and 7 million more have inadequate coverage, according to the AARP. On average, Medicare beneficiaries spend $860 a year on prescription medications, the advocacy group for seniors says. That represents 40 percent of their total drug costs, with the rest picked up by other forms of public and private insurance.
In June, the House of Representatives passed its version of a Medicare drug bill, a voluntary benefit that private insurance companies would manage. Critics have attacked that plan as full of holes and doomed to fail, and they argue that the current, broken system leaves prescription coverage largely in the hands of the insurance industry.
In a more technical salvo, a report issued today by the Urban Institute and the Commonwealth Fund found that an expenditure of $350 billion over eight years -- the House bill sets aside $320 billion over 10 years -- would meet only 23 percent of what seniors are likely to spend on drugs during that period.
"This approach meets almost none of the principles for coverage, and provides inadequate protection for those with high costs and/or low incomes," the authors say.
Under the House plan, which would take effect in 2005, the government would pick up much of the first $2,000 in yearly drug expenses. Seniors would pay for costs above that until $3,700, after which the government would cover the rest. The bill also requires a monthly premium of about $33 for all but low-income beneficiaries, as well as a $250 annual deductible.
Marilyn Moon, a health economist with the Urban Institute and a co-author of the study, says the House plan leaves "a big gap of coverage for individuals with chronic illnesses." Moon estimates that 30 percent of Medicare recipients spend between $2,000 and $5,000 a year on prescription drugs.
Ultimately, Moon says, her study shows that unless Congress is willing to spend at least $450 billion over 10 years on drug coverage, it won't be helping most seniors. "This is expensive stuff," she says. And to provide a truly comprehensive benefit, she adds, the tab is closer to between $70 billion and $90 billion a year for a decade.
Steve Hahn, an AARP spokesman, says his group hopes Congress can deliver a "meaningful and affordable" prescription drug bill when the Senate returns from vacation after its August recess. Not doing so, he says, would incur the ire of seniors in the upcoming elections.
"Seniors vote in huge numbers in mid-term elections," says Hahn. "The finger-pointing in this case won't make much of a difference [to the voting elderly]. They see this as the ineffectiveness of governance."
The Senate did take some action yesterday on prescription drugs. Lawmakers overwhelmingly approved a measure that would move generic drugs to market more quickly. The bill allows brand-name drug companies only a single 30-month patent extension to keep generic products at bay.
The bill also allows states to wrest deep discounts from drug makers with Medicaid's bulk buying power. Medicaid is the government's insurance program for the poor.
And it includes a provision that lets importers bring drugs into this country from Canada, where they are cheaper, and resell them.
What To Do
For more on the debate over prescription drug coverage, visit AARP or the Commonwealth Fund.
And try this federal government site for more on Medicare.
