For Release: November 22, 2003
Contact: David Gillies: 202-225-5661
COSTELLO VOTES AGAINST MEDICARE PRIVATIZATION
Washington - The House of Representatives prepared to pass the most sweeping changes to Medicare in the program's history. U.S. Congressman Jerry Costello (D-IL) announced his intention to vote against the legislation because it will privatize Medicare, cause up to three million seniors to lose their employer-provided drug coverage while means-testing benefits.
"This legislation does much more than add a prescription drug benefit, it ends the Medicare program as we know it," said Costello. "I have said that I would not vote for the privatization of Medicare, and that is what this bill does. It is an early Christmas gift to the insurance and pharmaceutical industries.
The bill does nothing to control the cost of drugs, while pushing seniors out of the traditional Medicare program and into managed care." The prescription drug benefit requires beneficiaries to pay a $420 yearly premium and a $250 yearly deductible. Seniors pay 25% of drug costs up to $2250. They then pay all costs up to $5,100. A senior with $5,000 in drug costs will still pay $4,000. The plan does not start until 2006.
"The bottom line is that seniors in the United States will continue to pay the highest drug costs on the planet," stated Costello. "Drug companies' profits should not come at the expense of Medicare beneficiaries."
The bill will:
· Privatize Medicare - Beginning in 2010, up to 6.8 million seniors will essentially be forced of traditional Medicare into some form of managed care.
· Drop Employer-Provided Plans - As many as three million retirees will lose their existing employer-provided drug coverage.
· Create a Different Benefit for Some Seniors - The bill violates the central premise of Medicare - to provide a consistent, guaranteed benefit that allows everyone in the country to access quality medical care - by means-testing benefits.
· Create a Huge Gap in Coverage - the drug benefit features a huge gap in coverage that leaves half of seniors without prescription drug coverage for part of the year.
· Fail to Contain Drug Costs - The bill lacks any provision to restrict drug companies from continuing to raise the price of drugs. It does not allow for the reimportation of drugs, nor does it increase access to generic drugs. The legislation prohibits the government from negotiating price discounts as is done currently by the Veterans' Administration.
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