Medicare Part D (Click Here for More Information)

New Medicare Act – Flawed from the Beginning

When the Medicare drug bill passed Congress, Congresswoman DeLauro remained steadfast in her opposition to it because she was concerned about the major gaps in coverage and because it did nothing to bring down the rising cost of prescription drugs.  Real choices, dependable coverage, and easy local access to doctors and pharmacies were her objectives.

Perhaps the most insidious feature of the legislation is that it opens the door to the privatization of Medicare.  The bill directs government subsidies to private insurance companies to encourage them to compete with Medicare.  At the same time, it places a cap, for the first time, on the amount of discretionary money the government can spend on Medicare benefits, thus ending Medicare's guarantee of universal health care benefits.

The bill would force 10 million seniors into HMO's through the so-called “premium support demonstration project,” requiring them to give up their doctors.  The President says that paying HMO's to enter the senior health care market gives seniors a “choice.”  In reality, Medicare provides seniors the widest choice because it allows them to choose the doctors they want. 

DeLauro believes that the Department of Health and Human Services should be able to negotiate with drug companies that want to provide drugs to seniors and be paid by Medicare funding – in essence, to bargain for a group discount like the Veterans Administration is able to do.  Unfortunately, this bill did not give the them the authority to do that – meaning that prescription drug prices will continue to rise for Medicare beneficiaries. 

The bill passed by Congress will still leave seniors to cope with high drug costs.  Because of the gap in coverage, a senior with significant drug costs would have to pay $4,02 out of their own pocket in one year.  After that, they would still be left with a co-payment that could be as much as 5% of all prescription costs.  The New York Times reports that one colon cancer drug has increased in price from $500 in 1999 to $250,000 today – so even with a five percent co-pay, a senior could have to pay $12,500 to get this treatment.

“Seniors are desperate for lower prescription drug prices, but unfortunately this bill did not deliver,” DeLauro said.  “Medicare must provide a meaningful drug plan with guaranteed, defined benefits – with no coverage gaps.  Congress should act to contain costs by giving the Secretary of HHS the authority to negotiate lower prices so that seniors will not have to pay more than seniors in other countries fro the same drug.  I will keep fighting until we make that happen.” 

If you would like to view a short documentary film, hosted by Walter Cronkite, that examines the intricacies of the Medicare Bill, please click here . 

Employers May Drop Retiree Medical Benefits

One of Congresswoman DeLauro's biggest concerns when the Medicare bill passed was that it might give some employers an excuse to drop health care coverage for retirees.  If private companies stop providing coverage, the 12 million seniors who combine coverage from their retiree health benefits with Medicare will have nowhere to turn for full health care benefits.  It will also mean massive additional costs for the struggling Medicare program. 

Unfortunately, some employers are already moving in that direction.  The New York Times , reported that new government estimates suggest that employers will reduce or eliminate prescription drug benefits for 3.8 million retirees when the new Medicare bill is fully in effect in 2006.  And in April, the Equal Employment Opportunity Commission voted to allow employers to reduce or eliminate health benefits for retirees when they become eligible for Medicare at age 65.

“This is another sign of a failed Medicare plan,” DeLauro said.  “Employers need to know that they need to live up to their responsibilities to their employees and maintain retiree health and drug benefits.” 

Medicare Approved Drug Discount Cards

The Medicare bill passed in 2004 created a new drug discount card, but the bill did nothing to prevent drug companies from actually raising prices before the discounts begin, essentially eliminating any benefit seniors might see from the card.  A study by Families USA showed that prices for the drugs the elderly use increased three and one half times more than overall inflation in 2003.  The cost of Clebrex increased 23% since mid-2001, and the blood thinner, Coumadin, has risen 22%.

Low-income seniors will likely see the most benefit from these discount cards, because they will be able to sign up for both a free discount card and $600 in government aid to buy prescription medicine.  However, seniors need to be very careful before signing up for a card.  Once signed up, seniors will be locked in to their card for a certain period of time – but the insurance companies issuing the discount cards can change the medicines they cover and how much they charge for them every seven days.  Even with this discount card, it still might be more affordable to buy some prescriptions from Canada.

For more information you can click here or call Congresswoman DeLauro's New Haven office at (203) 562 – 3718.  You can also call 1 (800) MEDICARE or reach ConnPACE at 1 (800) 423 – 5026. 

Reimportation Update

Hundreds of thousands of seniors have already taken advantage of the dramatically lower prescription drug prices in Canada by either ordering their medicine on line, or traveling by bus to pick up a supply.  Congresswoman DeLauro has been working in Congress to ensure that seniors will be able to continue to benefit from these lower prices without interference from pharmaceutical.

DeLauro has sponsored, and helped pass in the House, the Pharmaceutical Market Access Act, which would allow the importation of FDA approved medicines from Canada and other allied countries.  She is also working to permit the federal government to negotiate with drug companies for lower pharmaceutical prices on behalf of Medicare beneficiaries.  This can work – the government did the same thing during the anthrax scare, negotiating with Bayer to lower the cost of Cipro.

Drug Companies Try to Stop Cheaper Reimports

While working with a senior citizen's group in New Haven, Congresswoman DeLauro learned of letters sent by a U.S. drug company to wholesalers in Canada warning that they would be cut off from their supplies of prescription drugs if they sold to anyone who might be bringing the drugs to America.  DeLauro also obtained a letter from the same company that reported depriving two companies in Canada of their prescription drug supply.  She is fighting to pass legislation which would ban this practice by drug companies.

Representative DeLauro has asked the Chairman of this drug company to meet with her to explain what his company will do to bring drug prices for Americans down to the level they are sold in Canada and other western democracies. 

“This proves that the pharmaceutical companies will do anything to prevent seniors from finding alternatives to the inflated prices of prescription drugs here at home,” DeLauro said. “Until we can reduce the cost of medications in America, I will fight to ensure seniors can continue benefit from the lower prices across our borders in Canada.”