Medicare Rx Drug Benefit and Discount Act

The elderly and disabled have waited long enough for a prescription drug benefit in Medicare and for relief from the high cost of prescription drug prices. House Democrats are committed to providing a comprehensive benefit that is affordable and dependable for all beneficiaries with no gaps or gimmicks in coverage. This benefit will be similar to that which senior and individuals with disabilities get in Medicare now. What we offer senior citizens and individuals with disabilities should be no less generous than what Members of Congress and other Federal employees receive.

The House Democratic proposal adds a new Part D in Medicare that provides voluntary prescription drug coverage for all Medicare beneficiaries beginning in 2006.

  PREMIUM:                            $25 a month

  DEDUCTIBLE:                     $100 a year

  CO-INSURANCE:               Beneficiaries pay 20%;
                                                        Medicare pays 80%

  OUT-OF-POCKET LIMIT:  $2,000 out-of-pocket limit per
                                                         beneficiary per year

  LOW-INCOME:                    Beneficiaries with incomes up
                                                         to 150% of poverty pay no
                                                         premium or cost-sharing.
                                                         Beneficiaries with incomes
                                                         between 150% - 175% of
                                                         poverty pay no cost-sharing
                                                         and receive assistance with
                                                         the Part D premium on a
                                                         sliding scale.

Even with a Medicare drug benefit, seniors and the disabled want the assurances that they won’t be overcharged and they don’t want the Medicare program to be overcharged. That’s why Medicare contractors will obtain guaranteed reductions in prices, and the Secretary of Health and Human Services will have the authority to use the collective purchasing power of Medicare’s 40 million beneficiaries to negotiate lower drug prices – as was done successfully with Cipro in 2001. In addition, the proposal reduces drug prices for everyone by stopping big drug company patent abuses. The Secretary could also implement measures that will further reduce costs and improve quality for beneficiaries, such as: encouraging use of generic drugs, lowering co-insurance for preferred drugs, disease management, and beneficiary and provider education. Medicare would also require contractors to put in place safeguards to check for adverse drug interactions and proper use of medications.

Under the Democratic plan, seniors and individuals with disabilities will be able to keep making the choices that matter. Seniors won’t have to leave traditional Medicare to get drug coverage. Nor will they be forced to join a private insurance plan that will restrict access to needed drugs, deny coverage for the medicine their doctor prescribes, or force them to change pharmacies. Democrats will ensure that seniors will always be able to obtain the drugs their doctor says they need at reduced prices and will be able to choose where to fill their prescriptions.