On March 9, the Senate Special Committee on Aging heard testimony from the Centers for Medicare and Medicaid (CMS) and other experts to determine what seniors can expect when the new Medicare Prescription Drug Discount Card and the Transitional Assistance Programs go into effect in June. The programs were enacted as part of the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 (P.L. 108-173).
In his opening remarks, Chair Larry Craig (R-ID) stated, “No senior should have to choose between buying food and buying drugs — and the new card and assistance program is a critical transition to help those seniors in greatest need pay for their drugs during the time it takes to get the rest of the Medicare drug legislation up and running in 2006. This program is just a beginning, but it is an important one.”
Dennis Smith, Acting Administrator of the CMS, summarized the Medicare Prescription Drug Discount Card Program, noting that drug card sponsors would begin marketing and enrollment efforts on May 3, and enrollment would take effect on June 1. Card sponsors may be Pharmacy Benefit Managers, wholesalers, retail pharmacies, insurers, Medicare Advantage plans, or any other nongovernmental organization that meets the law’s requirements. To qualify for the drug discount card, he explained that Medicare beneficiaries must be enrolled under Medicare Part A and/or Part B, but cannot receive drug benefits under Medicaid. In addition, the Transitional Assistance Program would provide additional assistance of up to $600 for Medicare beneficiaries whose incomes do not exceed 135 percent of the federal poverty level, $12,569 for individuals and $16,862 for couples. To ensure that seniors have convenient access to their neighborhood pharmacies, the bill requires that 90 percent of Medicare beneficiaries live within two miles of a participating pharmacy in urban areas; 90 percent of beneficiaries live within five miles in suburban areas; and 70 percent of beneficiaries live within 15 miles in rural areas. Mr. Smith stated, “We expect beneficiaries to save an estimated 10 to 15 percent on their total drug costs, with discounts of up to 25 percent or more for individual prescription drugs.”
Mr. Smith said that the CMS plans to educate the public through print, radio, and television advertisements that highlight changes to Medicare and explain the new drug discount card. He also noted that the advertisements would direct beneficiaries to a toll-free number and website where they can find additional information. The website also would feature a prescription drug comparison tool so beneficiaries can determine how much they can save for drugs at the pharmacies in their area. During the question and answer session, Sen. Craig voiced his concern that seniors may lack the technical capability to use the comparison tool; Mr. Smith responded, “We worked with the senior in mind when we developed the website.” He also pointed out that seniors could request the comparison pricing when they call the toll-free number.
Jim Firman of the National Coalition on the Aging praised enactment of the drug discount card. As one example, he said that a 68-year-old woman in Louisiana with an income of $11,000 and annual drug costs of $2,500 could expect to save $2,100 with the discount card; her out-of-pocket costs for the year would amount to $475. Expressing his concern that outreach to low-income Medicare beneficiaries will be difficult, Mr. Firman pointed out that many Medicare beneficiaries are confused about the new Medicare law. He said that, according to a Kaiser Family Foundation survey, “Only 15 percent of senior respondents (7 percent of the public overall) said that they understood the new prescription drug law very well and almost 7 in 10 did not even know that it passed and was signed into law.” Mr. Firman told the committee that the NCOA is forming the Access to Benefits Coalition, a public-private partnership dedicated to ensuring that low-income beneficiaries can make optimal use of the drug discount card and other available resources for saving money on prescription drugs. Finally, he pointed out that a number of pharmaceutical manufacturers offer programs for seniors that “wrap around” the Medicare drug discount cards. “For example,” he stated, “Merck recently announced that once a Medicare beneficiary uses up their $600 debit on a Medicare-approved card, that person can purchase their Merck medications for the rest of the year for only a dispensing fee.”
Testifying on behalf of the National Association of Chain Drug Stores, Craig Fuller expressed some of his concerns with the current Medicare Prescription Drug Discount Card. “The challenges for seniors, and for pharmacies, will be helping them sort through all the details of the various card programs, such as whether the drugs covered under a particular card program match with the drugs that the senior is taking, whether there are significant discounts on the prices of the drugs, and whether the patient’s retail pharmacy is part of the card sponsor’s network,” he stated. Mr. Fuller offered suggestions for improvement: information about “wrap around” benefits must be provided to pharmacies at the point of care quickly by the card sponsor to coordinate benefits; all card sponsors should collect information from beneficiaries at the point of enrollment about other potential card programs or sources of coverage they already have; the CMS must allow card sponsors to adjudicate claims transactions for drugs and supplies covered under the discount card program online; and the CMS must be diligent in its education materials to make it clear to beneficiaries that card-sponsored prescription drug prices will likely not remain the same during the year and that drugs covered by the discount are subject to change.
Forest Harper of the Pfizer for Living Share Card Program offered Pfizer’s discount card program as a model, noting, “The program was launched in January, 2002, and over the last two years the Pfizer Share Card has helped more than 500,000 low-income Medicare enrolled seniors and disabled persons who do not have prescription drug coverage obtain needed medications to improve their health.” He explained that the program provides three immediate health benefits to enrollees: the Pfizer Share Card allows beneficiaries to obtain Pfizer products for a flat fee of $15 per monthly prescription; the program allows beneficiaries to obtain health education information on common medical conditions, such as high blood pressure and diabetes; and the program offers enrollees access to live customer service representatives who provide assistance on filling out the application and information on state and federal programs for which they may be eligible.
Mr. Harper shared one success story with the committee. “Lorraine, who is 74 years old and lives in Sandy, Utah, became a Share Card member in September of 2002. At that time, Lorraine had no prescription drug coverage and great difficulty getting the medicines she needed…She found that the Pfizer Share Card saved her about $100 per month,” he stated.
