Elder Law Answers Elder Law Answers

Search Articles

Find Attorneys

Bush Rule Makes Medicare Drug Card Savings Less Likely

  • December 11th, 2003

As a result of the Bush administration's unwillingness to guarantee discounts, the drug discount cards authorized by the new Medicare law will "leave seniors more confused and with little or no savings," says Richard Fiesta, director of governmental and political affairs for the Alliance for Retired Americans.

The Medicare-approved discount cards, which will become available in June, are intended to provide Medicare beneficiaries some interim relief from high prescription drug costs until the new law's limited drug benefit takes effect in 2006. The cards will provide discounts that the government estimates will be 10 percent to 15 percent on at least 200 of the most commonly prescribed drugs for seniors at a cost of up to $30 per year for beneficiaries.

However, under a just-issued regulation covering the discount cards, the Bush administration has ensured that the sponsors of drug discount cards will be allowed to change their prices '” and the list of covered drugs '” on a weekly basis. In addition, the regulation does not specify the size of discounts, but simply states that companies sponsoring discount cards must obtain "some level of rebates, discounts or other price concessions" from drug manufacturers and must share some of the savings with Medicare beneficiaries, according to The New York Times.

Sen. Edward M. Kennedy (D-Mass.), who led opposition to the Medicare bill, said the new discount card regulations once again "put corporate profits ahead of patients' needs."

Several health experts suggest that seniors may find better deals if they buy their medications online or comparison shop among pharmacies and discount retailers like Costco, according to The San Francisco Chronicle.

Bruce Livingston, executive director of San Francisco's Senior Action Network, said the discount cards won't work if pharmaceutical companies continue to be allowed to charge whatever they want for their drugs. Under the new Medicare law signed by President Bush, the federal government is prohibited from negotiating with drug companies for discounted drug prices.

"In general, we've found drug discount (cards) don't come close to doing the job. We need real control on prices," said Livingston.

Gary Claxton, vice president of the Kaiser Family Foundation, expects many Medicare recipients will be confused about the process.

"Medicare is going to give you something and then, 18 months later, give you something different. And you're going to have to understand them both," he said.

Medicare beneficiaries with very low incomes may be the only ones deriving any real benefit from the cards. As part of the discount card program, they will receive a subsidy of up to $600 a year to help pay for prescriptions. To qualify, Medicare beneficiaries must have incomes less than 135 percent of the federal poverty level '” at most $12,123 for an individual and $16,362 for a married couple this year.

For The New York Times article, go to: http://www.nytimes.com/2003/12/11/politics/11MEDI.html (Free registration required and article may no longer be available.)

For the article in The San Francisco Chronicle, click here. (Article may no longer be available.)

Get in touch with the Alliance for Retired Americans at http://www.retiredamericans.org

Local Elder Law Attorneys in Ashburn, VA

Margaret O'Reilly

Margaret A. O'Reilly, PC
Herndon, VA

Jeffrey Hammond

Hammond and Associates, LLC, Elder Law, Estate Planning, Wills, Trusts, Probate
Bethesda, MD

Samantha Fredieu

Hale Ball Carlson Baumgartner Murphy PLC
Fairfax, VA


Last Modified: 12/11/2003

Learn More

View All Elder Law Topics Questions & Answers State Medicaid Information