August 2000 • Volume 6 • Number 8
Medicare drug coverage plans spark political firestorm
Mrs. Smith, an elderly widow, needs two medicines for her heart disease. When money's tight, she buys one drug over the other and tries to get by.
Mr. Jones is on a top-dollar new drug for ulcers. He sometimes takes his pill every other day instead of each day to stretch his prescription.
Are these patients rare exceptions? Not a chance. They exemplify some patients of Daniel Heinemann, M.D., of Canton, S.D., a member of the AAFP Commission on Legislation and Governmental Affairs.
"I've never had patients pick between food and medicine, but they tend to skimp on their medicines," says Heinemann.
Complications from skipping medicines have landed a few of Heinemann's patients in the hospital. "Ironically, expensive drugs can help people stay out of the hospital," says Heinemann. "That saves the Medicare system. But it's a savings borne on the backs of the elderly."
With elections this year, Democrats and Republicans want to claim success in helping to cut seniors' drug costs. But the AAFP says a bill the House of Representatives passed 217-214 on June 28 -- the Medicare Rx 2000 Act, H.R. 4680 -- falls short of what America needs.
AAFP principles
The Academy is measuring various proposals according to these principles:
- Medicare beneficiaries at or below poverty level should receive full premium support for a prescription drug benefit (coverage at no cost).
- Some premium support should be offered to those with incomes at 100 percent to 150 percent of poverty level.
- Out-of-pocket expenses should be capped at $3,000 a year.
- There should be no annual or lifetime limit on the benefit.
- There should be no national Medicare drug formulary.
- Except for those within 150 percent of poverty level, beneficiaries could have a deductible of up to $300 per year and a copay of up to 20 percent.
- There should be a tax deduction or credit for out-of-pocket expenditures above $2,000 in any year.
Lanny Copeland, M.D. "Medicare without prescription drug coverage is an anachronism that must be righted by Congress."
Proposals in Congress
H.R. 4680 calls for a prescription drug program to be administered by a Medicare Benefits Administration and offered by private insurers and Medicare+Choice plans.
"There is no guarantee that private insurance companies will offer this benefit, and a separate program would add complexity and confusion to the Medicare program," says AAFP President Bruce Bagley, M.D., of Albany, N.Y. "We support coverage under the Medicare program."
H.R. 4680, backed by House Republican leaders, would cover prescription costs over $6,000 but would require many beneficiaries to pay nearly $5,000 of the first $6,000 per year. That "would be a burden, if not outright prohibitive, for some of our patients," says Bagley.
The AAFP supports a House Democratic proposal even though it would set the cap on out-of-pocket expenses at $4,000 (AAFP is calling for a $3,000 cap). The proposal would establish the drug benefit program within the current Medicare program and -- in a significant improvement over earlier drug coverage proposals -- would have no deductible.
The estimated five-year cost of H.R. 4680 is $40 billion, and that of the Democratic proposal is $80 billion. At press time, Senate leaders had yet to decide whether to back any Medicare prescription drug bill this year.
However, the Senate Finance Committee was working on a Medicare prescription drug benefits proposal. "Medicare without prescription drug coverage is an anachronism that must be righted by members of Congress," AAFP Board Chair Lanny Copeland, M.D., of Albany, Ga., wrote the committee July 12.
He listed elements the Academy hopes the committee will endorse and suggested what to avoid. "Proposals that rely on a separate insurance program, provide variable benefits to seniors or are too costly for beneficiaries to take advantage of would not meet the (AAFP's) standard," said Copeland.
In addition to assessing proposed legislation, the AAFP has objected to politicizing prescription drug coverage.
"This benefit has become a political firestorm," says Bagley. "Some seniors are already struggling with their bills. Don't make them struggle with the politics, too."
FP Report is published by the AAFP News Department.
Copyright © 2000 by American Academy of Family Physicians.
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