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Administration Issues Final Rules on Drug Discount Cards

  • September 6th, 2002

The Bush administration has issued a revised proposal for a Medicare-endorsed discount card to help seniors save money on prescription drugs. However, opposition from chain drugstores and pharmacists is threatening to derail the plan.

Under the terms of the program, seniors would pay up to $25 for one of several drug discount cards offered by private organizations and receiving Medicare's seal of approval. The cards would give seniors discounts of 10 percent to 13 percent on prescriptions. The savings would come from discounts and rebates the card-issuing organizations negotiate with drug companies

Bush administration officials estimate about 10 million people would enroll in the program, and each would save about $170 per year. But even administration officials concede that the program will be only a small aid to cash-strapped seniors facing mounting prescription drug costs.

"The bottom line," said Thomas Scully, administrator of the Centers for Medicare & Medicaid, "is this is not going to fix seniors'' drug problems."

In any case, pharmacists are expected to continue their legal challenge to the plan. Last year the National Association of Chain Drug Stores and the National Community Pharmacists Association filed a lawsuit claiming the drug card plan was unconstitutional. In September 2001, a federal judge ruled that the Bush administration lacked the constitutional authority to implement the program and instead had to follow the "normal, public rule making process." If the revised proposal is declared unconstitutional, administration officials say they will ask Congress to pass legislation giving the government the power to create such a plan. A U.S. district judge is expected to rule on the program in the next several months.

To read an article on the drug discount program in the Washington Post, go to: www.washingtonpost.com/wp-dyn/articles/A18103-2002Aug30.html

To read the press release from the Centers for Medicare & Medicaid, go to: http://cms.hhs.gov/media/press/release.asp?Counter=486

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Last Modified: 09/06/2002

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