New Programs for Reducing Drug Costs
Rich OBoyle, Publisher
Seniors will have to wait a bit longer for the federal government to help them take a serious bite out of the costs of prescription drugs, but they can take advantage of some small programs that have recently become available.
After all the sound and fury of the presidential elections that dragged into January of last year, many of us were hoping for swift action on a new drug benefit for Medicare beneficiaries. Democratic candidate Al Gore made it a centerpiece of his campaign. President George Bush claimed equal footing with Gore. When everyone is in agreement, one could expect some rapid action, right?
Unfortunately, the apparent agreement was only in principle, not in the details. Initial action by President Bush toward launching a drug discount program for seniors quickly stalled in the courts as pharmacies sued to stop it. Democrats in Congress called the measure too little, too late and proposed an elaborate plan of their own. With Democrats and Republicans at odds in Congress, and industry groups facing off with the federal government, seniors can expect for more delays.
A handful of public and private programs are just becoming available that seniors of modest means can take advantage of.
Pharmacy Plus in Illinois
The federal government just opened the iron gates a crack wider for access to the Medicaid program. While the program is still severely restricted to individuals who are impoverished with minimal assets and income, the government is allowing the states to give a limited prescription drug benefit to some seniors who do not qualify for Medicaid.
The first of these model demonstration projects is in the state of Illinois and will allow low-income seniors to receive prescription drug coverage through Medicaid. Eligibility would be limited to those with incomes up to twice the federal poverty level, which means it will cover individuals earning up to $17,200 annually and couples earning up to $23,220 annually. Individuals could pay an annual enrollment fee of $5 or $25, depending on their income levels. In Illinois, Medicaid would pay virtually all the costs of prescriptions up to a total of $1,750 each year, with enrollees responsible only for a nominal co-payment of $3 or less for each prescription. Medicaid would pay roughly 80 percent of the costs of additional prescriptions, with enrollees paying 20 percent plus the nominal co-payment.
An estimated 368,000 low-income seniors in Illinois will be affected. The Illinois program was announced on January 29, 2002 but will not begin until June 1, 2002. For additional information on the Illinois program, visit http://www.state.il.us/dpa/html/seniorx_care_fact_sheet.htm
More states are interested in starting up similar benefits under the program called Pharmacy Plus. The federal government is working within the existing Medicaid program to bend the rules and allow states to quickly set up programs like the one in Illinois. Hopefully more states will follow suit in the near future.
Individual Drug Companies
Drug research and manufacturing is one of the most profitable businesses in the world. So dont be surprised that pharmaceutical companies are listening very carefully to the debate in Washington and around kitchen tables. Government efforts to control drug prices or force certain prescription drugs on to of off of preferred medication lists (also called formularies) usually stimulate the drug companies to open their purses a little bit to quiet the noise.
The current debate has encouraged a handful of companies to offer their own unique drug discount programs for low- to middle-income seniors. While they do offer meaningful discounts for seniors, they only apply to drugs that they make themselves. So if you take several drugs on a regular basis, you will need to fill out several applications and keep track of which companies offer these benefits.
Its important to note that two leading drugs used to treat Alzheimers Disease (Aricept and Exelon) are covered under these programs. If your loved one takes one of those drugs, and you dont have some other insurance program that pays for prescription drugs, you should follow up on these leads.
Together-Rx Card (http://www.together-rx.com). Eight drug companies have simplified their discount programs by offering a combed card. Eligible individuals must have under $28,000 annual income (or $38,000 for couples). Participating companies include Abbott Laboratories, AstraZeneca, Aventis Pharmaceuticals, Inc., Bristol-Myers Squibb Company, GlaxoSmithKline, Janssen Pharmaceutica Products, L.P., Novartis, and Ortho-McNeil Phamaceutical, Inc. Benefits vary for each participating company. To enroll, call 1-800-865-7211 or visit http://www.together-rx.com for the downloadable application form.
Sampling of Covered Drugs:
Sampling of Covered Drugs:
Novartis Care Card (http://www.novartis.com/carecard). Eligible participants must have annual income less than 300% of the Federal Poverty Level (approximately $26,000 for an individual; $35,000 for a couple). The program covers outpatient prescription products in the U.S. The Novartis CareCard will be available free of charge. It will provide a discount of 25% off the wholesale list price. This should translate to patient savings of between 30-40% off of retail prices. Call 1-866-974-2273.
Sampling of Covered Drugs:
GlaxoSmithKline Orange Card (http://www.gsk.com/press_archive/press_10032001.htm). GSK expects participants to realize average savings of 30% off the price individuals without prescription drug coverage would usually pay for GSK medicines at their pharmacy. Applications are available by calling a toll-free number: 1-888-ORANGE6. Eligible seniors must have annual incomes at or below 300% of the federal poverty level (annual incomes at or below $26,000 single or $35,000 for a couple). Individuals must lack public or private insurance programs or other pharmaceutical benefit programs, such as Medicaid.
Sampling of Covered Drugs:
LillyAnswers (http://www.lillyanswers.com). Eli Lilly offers a flat $12 administrative fee for a 30-day supply of any Lilly retail distributed drug. The program is open to Medicare enrollees with individual annual income below $18,000 or household income below $24,000. Seniors can apply for the Lilly program by calling toll-free: 1-877-RX-LILLY
Sampling of Covered Drugs:
Existing Patient Assistance Programs
Prescription Drug Assistance Programs for those with very low incomes offered by drug companies and Pharmaceutical Assistance Programs offered by individual states are listed in directories linked to ElderCare Onlines Medical Research Assistant at http://www.ec-online.net/Assistants/medresassistant.htm. Most of these programs are tied closely to eligibility for Medicaid (not Medicare), so if your loved one is on Medicaid (or in a nursing home), they could be eligible for these programs. With the help of your doctor, you can fill out the necessary applications, but the drug companies will look at both income and assets, so they are usually harder to qualify for.
The Numbers Dont Lie
I hate to think of our individual members as statistics, but research shows that a huge proportion of seniors and caregivers are struggling with the costs of prescription drugs. We dont need to ask a statistician, just look at your own check book or ask one of your support group friends or an elderly neighbor.
While the elderly currently represent approximately 12.6% of the US population, 38% of all prescriptions are written for this group. An estimated one-third of seniors living at home lack drug coverage and are facing mounting prescription costs, as traditional sources of coverage (i.e., employers and HMOs) are eliminating and reducing benefits and increasingly shifting costs to patients.
About 30% of seniors do not have any kind of drug coverage, according to federal government estimates, and 40% had at least one span of time during the year where they were not covered. This is a big deal because Medicare beneficiaries without prescription coverage spend an average of $546 per year for outpatient medicines, according to the Center for Medicare and Medicaid Services (the federal agency formerly known as the Health Care Financing Administration).
Recent actuarial projections suggest that the share of beneficiaries without prescription drug coverage has increased to about 33% from 30% in the last few years, according to an AARP research report Trends In The Costs, Coverage, And Use Of Prescription Drugs By Medicare Beneficiaries at http://research.aarp.org/health/dd63_trends.html.
Most existing benefit programs include what is often referred to as a means test: does the applicant meet specific income and asset criteria? Fortunately, the recent proposals generally only consider income levels (although those tied to Medicaid eligibility will consider assets as well). The key measure for eligibility is tied to the federal poverty level:
Federal Poverty Level $8,590 income per
The annual State of the Union Address is usually a ceremonial affair, but from time to time, presidents have announced major policy initiatives. Unfortunately, President Bushs address on January 29, 2002 just scraped the surface of the Medicare issue, lumping it in with a list of generic crowd pleasing statements. Of course everyone is for a reformed Medicare program that gives seniors prescription drugs, but the president needs to hammer out the details with the other politicians and get them enacted into law.
Too often we hear about exciting proposals in the news and in high-profile press conferences. What we need is action on the part of our legislators. I was a senior Capitol Hill correspondent for seven years and I have seen the sausage being made. My fear (and I think it is well-founded) is that nothing is going to get done on a significant scope until long after the Congressional elections this November.
Mr. Bush has proposed numerous enhancements to Medicare, but they are just that proposals. He has to collaborate with Democrats (and some maverick Republicans) to come up with real legislation that a majority can agree to and then get it enacted into law within a reasonable time frame. Meanwhile, numerous other important issues are competing for the attention of members of Congress, not the least of which include an economic stimulus package, terrorism legislation, and campaign finance reform. Medicare reform will get swept to the side and only small incremental changes will be possible for the foreseeable future. Some of the small changes, however, have the possibility of a large impact on some families.
White House Discount Card for Medicare Beneficiaries
Bureaucratic and legal wranglings have stalled the implementation of the Medicare Discount Drug Card that President Bush proposed in July 2001. A spokesman for the Department of Health and Human Services told me on January 29, 2002 that the Administrations goal is to have the card up and running by October of this year.
But that is only if current litigation goes in their favor. Retail pharmacies have filed suit in court to block the government proposal, which has forced the government to go through a tedious regulatory review process. In the meantime, Congress may step in to give the government the authority to go ahead despite the legal attacks. As the elections approach in November, dont be surprised if legislative action slows to a crawl as candidates jockey for position.
According to the White House, seniors today have some access to voluntary discount cards that provide pharmacy discounts of about 10 percent on average. Privately-insured Americans regularly achieve additional savings of between 2 percent to 35 percent on brand name drugs through manufacturer discounts.
To provide more affordable Medigap options before the improved benefit package becomes available, President Bush has proposed the addition of two new Medigap plans to the existing ten standardized plans. The new plans would include prescription drug assistance, protection against high out-of-pocket costs, and buydown of most of the cost of Medicare deductibles and copays.
Caregiver Action Items
+ Collect your loved ones most recent
tax return or Social Security statement
Resources Mentioned in This Article
- Pfizer for Living
Prism Innovations, Inc., the publisher of
ElderCare Online and ALZwell Caregiver Support has not taken any consideration,
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article. For that matter, Prism has not made or accepted contributions from politicians or
political parties. Prism markets the Prism Care Card, a private pharmacy discount program.
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